CAI expresses its appreciation to NCDEX and all stakeholders for their support and cooperation and looks forward to a long and productive partnership in strengthening India’s cotton futures market.
The Cotton Association of India (CAI) and the National Commodity & Derivatives Exchange (NCDEX) today signed a Letter of Engagement at the NCDEX office in Mumbai, marking an important step towards developing and strengthening the cotton futures market in India.
The Letter was signed by Vikas Goel, Managing Director & CEO, NCDEX, and Vinay N Kotak, President, CAI, in the presence of Lalit Kumar Gupta, CMD, Cotton Corporation of India, members of the NCDEX Board, and members of the CAI Board and Committees.
Speaking on the occasion, Vinay N Kotak said, “For CAI, this association with NCDEX represents a return to our historic roots while firmly looking towards the future. CAI brings rich legacy and deep domain knowledge in cotton futures, while NCDEX brings technology, institutional strength and commodity derivatives expertise. Together, we are confident of creating a liquid, transparent and user-friendly cotton futures market serving the entire cotton and textile value chain.”
Recalling CAI’s historic role, Kotak noted that CAI had permanent recognition under the Forward Contracts (Regulation) Act, 1952, and was the first exchange permitted to resume cotton futures trading when futures were re-introduced in 1998, following the Government’s ban in 1966. CAI subsequently generated substantial volumes in cotton futures before exiting the segment with the emergence of multi-commodity exchanges.
He emphasised that futures perform three vital functions—price discovery, hedging and risk management, and providing liquidity. “India is one of the world’s largest producers and consumers of cotton, yet Indian market participants often look towards international markets for hedging. We should aspire to become Atmanirbhar in futures,” he said.
Kotak stressed that the success of the cotton futures contract would depend on active participation across the entire value chain. “The exchange provides the platform, but liquidity is a collective responsibility of market participants. We must take the first step and actively participate in the market,” he added.
Concluding, Kotak said, “Let today’s signing mark the beginning of a new chapter in India’s cotton futures market, with the Government, the exchange and market participants working together to make India truly Atmanirbhar in cotton futures. One of our key objectives is to support the Government’s vision of Atmanirbhar futures price discovery and hedging facilities for cotton, enabling better price discovery and higher income for farmers, while providing textile product exporters with an effective risk mitigation tool to hedge their cotton raw material requirements and contributing to the Government’s goal of achieving US$100 billion in textile exports by 2030”.
Joining him, Vikas Goel, MD and CEO, NCDEX, said, “Cotton is central to India’s agricultural economy, yet our derivatives market has never fully reflected the country’s scale of production. This partnership with CAI is a deliberate step to change that. CAI’s deep membership base and on-ground expertise will be invaluable as we work together on market development and open up new possibilities for India’s cotton Value chain participants. Not only it will help NCDEX strengthen our Cotton Complex offering and build trade practices that align with global standards, it will also give the entire value chain, from growers to exporters, a transparent, reliable way to manage price risk, and build a price benchmark that truly reflects India’s standing as one of the world’s largest cotton producers.”
CAI expresses its appreciation to NCDEX and all stakeholders for their support and cooperation and looks forward to a long and productive partnership in strengthening India’s cotton futures market.