FMC opposes suggestion for retirement age at 60 yrs

A Parliament panel’s suggestion that the chairman and members of the Forward Markets Commission (FMC), regulator for the commodity derivatives markets, should retire at the age of 60 years has evoked indignation from the latter.

The standing committee on consumer affairs, food and public distribution had made the suggestion. However, the retirement age for board members of the capital markets regulator, the Securities and Exchange Board of India, is 65 years. For the Reserve Bank of India, regulator for the banking sector, there is no retirement age bar for the governor and is 62 years for the deputy governors.

In an official note sent to the Union government’s department of consumer affairs on Friday, the FMC has said such differential treatment isn’t acceptable.

If the 60-year bar is accepted for the FMC, its chairman and both members would have to retire.

However, the other recommendations of the panel, chaired by Vilas Muttemwar, Lok Sabha member from Nagpur, are generally agreeable to the FMC. It has said both spot and futures trading should be allowed in commodity exchanges. And, that foreign participants not be allowed under the commodity derivatives platform, to avoid any danger of such funds cornering any commodity.

Another suggestion is to have a separate investigating agency under the aegis of FMC to probe irregularities on the exchange platform. It has also recommended allowing more instruments such as options, in line with the capital markets, to attract more participations. The panel had examined the proposed set of amendments to the decades-old law establishing the FMC, to give it more teeth, bringing it at par with other regulators. The department of consumer affairs is now process the panel’s recommendations, before these are vetted by the law ministry and other departments concerned. It would then go for final approval to a Cabinet committee. All this would require at least two months, said an official of the department, before it is taken forward in Parliament.