The Hindu Business Line : Finance Ministry reviewing proposal to strengthen FMC

The Government has proposed conferring powers that would enable FMC to recognise exchanges and decide on issues like allowing exchanges to trade on new commodities, a top FMC official told presspersons here on the sidelines of a workshop.

It also proposes for the FMC to have seven members instead of the present level of four. "The proposal is to make FMC an autonomous body and confer Security and Exchange Board of India (SEBI)-like power on it," he said.

On financial autonomy, he said, FMC would be allowed to charge its members, according to the proposal.

"Warehouse receipts would also soon become negotiable instruments with the Government likely to introduce an amendment to this effect in Parliament in the coming Winter Session," said a senior official from the Department of Consumer Affairs.

This would enable farmers to take bank loans against their warehouse receipts obtained from certified warehouses. "The proposal also recommends allowing options trading and takes care of definition of commodities. Moreover, the exchanges would be asked to have grading facilities at warehouses," he added.

A Cabinet note would be circulated encompassing all these proposals and an amendment to the Forward Contract (Regulation) Act 1952 is likely to be introduced in Parliament in the coming Winter Session.

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