After spate of complaints that futures trading was the reason for spiralling of prices of agriculture commodities, the Centre has decided to constitute an advisory committee to suggest on ways to curb volatility in prices of commodities in the futures market.
The committee would monitor the situation and advice the government about the steps to be taken in case of sudden fluctuation of prices in open market, Food & Consumer Affairs Minister K V Thomas told Deccan Herald.
The committee, comprising farmers, market experts, traders, will advise the government and Forward Markets Commission (FMC) on how to bring about a better alignment between physical markets and futures markets so that farmers and hedgers benefitted from futures trading. Subcommittees will also be constituted on each commodity which will also provide inputs.
On the proposed Forward Contract Regulation Act (FCRA) Amendment Bill, he said the bill is before the Cabinet for consideration and expects it to be cleared in the monsoon session of Parliament. The FCRA bill aims at developing the commodities futures market by strengthening the FMC with financial autonomy. It also proposes to facilitate the entry of institutional investors and introduce new products for trading.