NSE: The National Stock Exchange of India said that it is in talks with the Indian Gas Exchange (IGX) about a strategic partnership to create and introduce Indian Natural Gas Futures, a historic project meant to fortify India’s natural gas market ecology.

According to an NSE statement, the proposed futures contract would provide market players a clear, effective, and reliable risk-management tool that is in line with India’s changing natural gas pricing structure.

Through this partnership, IGX’s strength in spot natural gas trading, price discovery, and physical market growth is combined with NSE’s extensive knowledge of the derivatives market.

By facilitating efficient hedging against price volatility and enhancing long-term planning, the launch of Indian Natural Gas Futures is anticipated to benefit gas producers, city gas distribution companies, power generators, fertilizer manufacturers, industrial consumers, traders, and financial participants.

“The proposed collaboration with IGX represents a significant step in NSE’s efforts to deepen India’s commodity derivatives markets,” said Sriram Krishnan, Chief Business Development Officer, NSE. A local futures contract would increase price transparency, strengthen risk management skills, and aid in the creation of a reliable gas pricing benchmark in line with Indian market fundamentals as natural gas emerges as a crucial transition fuel for India’s energy mix.

He continued: “By leveraging NSE’s market infrastructure and IGX’s physical market expertise, we aim to create a futures product that is relevant, liquid and trusted by the entire gas value chain.”

The suggested partnership is in line with India’s overarching goal of boosting market-based pricing mechanisms and expanding the proportion of natural gas in the energy basket.

NSE and IGX would collaborate closely with stakeholders to guarantee a seamless launch of the proposed derivatives contract, subject on regulatory clearances. In due course, further information on contract design and launch schedules will be made public.

The first Indian exchange to use electronic, or screen-based, trading was the National Stock Exchange of India (NSE). Exchange listings, trading services, clearing and settlement services, indices, market data feeds, technological solutions, and financial education programs are all part of NSE’s fully integrated business strategy.