Once all the issues discussed in previous blog, dated 25^th of February, which are believed to be indispensable pre-requisites, are met, the next important issue in the Nepalese commodity market shall be corporate governance, more specifically, transparency and disclosure components of corporate governance. It is evident to all that transparency and disclosure issues have been a major bottleneck for commodity market in Nepal. Due to deficiency of regulation in the Nepalese commodity market, as exchanges are not obligated to practice international standards of transparency and disclosures mechanisms, the market or the stakeholders are still skeptic over the Nepalese commodity market. No matter how prudently exchanges operate and provide their full-fledged services, until and unless the standard resolution for transparency of market mechanisms and disclosures parameters are met, of course via promulgation of regulation, the incompatible and harsh side of the market shall always remain for exchanges.

For any sector within the financial industry, especially in a fast-paced sector like commodity or derivative market, the need of regulator, supervisor and controller is immensely mandatory. Once the regulation is in place, other factors could be streamlined without extensive endeavors, as regulation shall set parameters for every aspect of business operation or module.

Currently, as all the stakeholders of commodity market from exchanges themselves,  brokerage houses to traders, have been patiently waiting for the regulation to be in place, it is only time that will tell, when the regulation shall be finally promulgated, providing a sigh of relief to all the market participants. The much sought regulation will not only provide a legitimate framework for Nepalese commodity market, but will also incorporate the association or partnership of many related stakeholders ranging from banking and financial institutions, units facilitating warehousing, dealers and merchandisers to farmers and co-operatives (for agro-based products). Now, with the sought regulation on commodity market, which is expected to come into practice very soon, we can only hope for a well-defined commodity market in Nepal, satisfying and serving the needs of all the stakeholders, generating a synergy effect and taking the market towards greener pastures.