The Hindu : Business : Forward Contracts Act to be amended: Sharad Pawar

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Friday, Jul 15, 2005

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Forward Contracts Act to be amended: Sharad Pawar

Special Correspondent

FMC to be given functional and financial autonomy

NEW DELHI: Consumer Affairs, Food and Public Distribution Minister Sharad Pawar on Thursday disclosed that the Forward Contracts Regulation Act of 1952 was being amended to strengthen and restructure the Forward Markets Commission. The amendments would provide for setting up of the Forward Markets Appellate Tribunal on the lines of the Security Appellate Tribunal.

Ministry officials added that a revamped bill would be submitted for Cabinet clearance soon so that it can be introduced in the monsoon session of Parliament.

Addressing a conference on `Commodity Futures in India,' organised by the Associated Chambers of Commerce and Industry of India, the Minister said the amendments would ensure that the commodity markets regulator FMC was given functional and financial autonomy. He said the original legislation was well documented but the amendments aimed at updating the Act and making more suitable for current market conditions.

Derivatives trade

Mr. Pawar referred to the `unprecedented growth' in commodities derivatives trade recently and stressed that the Government was looking into various issues pertaining to standardisation and gradation, negotiability of warehouse receipt and development of modern warehousing infrastructure across the country. He noted that during 2004-05, the total value of commodity futures trade stood at Rs. 5.71 lakh crore as compared to Rs. 1.29 lakh crore in 2003-04 and Rs. 66,530 crore in 2002-03. Besides, the commodities derivatives trade value for 2004-05 stood about 20 per cent of GDP. The Minister also disclosed that the Government proposed to introduce a bill in Parliament on development and regulation of warehouses.

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