Strengthening FMC our top priority: Ramesh Abhishek

Interview with Chairman, FMC

Forward Markets Commission (FMC) Chairman Ramesh Abhishek, in an interview with Rajesh Bhayani, talks about the commission’s priorities once the Forward Contract Regulation Act (FCRA) Bill is cleared by Parliament. Edited excerpts:

The Cabinet has cleared the much-awaited FCRA Bill. What next?
The Bill would have to be passed by Parliament. Only then would it become an Act. Once that happens, FMC's priority would be to restructure and strengthen the commission. It would have nine members (currently, it has three) and a chairman. It would also have to recruit more employees and experts for effective regulation.

Are you confident of the Bill being passed in Parliament?
Public perception about commodity futures regulations has improved over the past few months. There have virtually been no complaints of price manipulation. Also, price volatility is somewhat under control now. The reasons for this include a revival in the monsoon, an improvement in the general sentiment and tighter regulations.

 

What changes can one expect after the Bill becomes an Act and FMC is strengthened?
The Bill provides for transferring several powers from the Ministry of Consumer Affairs to FMC. These include taking action against exchanges and derecognising those. The Bill also seeks to empower FMC to regulate intermediaries, including brokers and warehouses, and levy fees and fines. More importantly, FMC would have to focus on developing information technology and other infrastructure and establish an online surveillance system. This would also help the Commission improve investigation and enforcement.

When would options trading begin?
It is too early to talk about that.