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The Union Cabinet on Thursday deferred consideration of the much-awaited Forward Contract Regulation Act (Amendment) Bill.The Forward Contract Bill aims to give more powers to Forward Market Commission, the commodity markets regulator.

 The Cabinet meeting chaired by Prime Minister Manmohan Singh deferred consideration of the Forward Contract  Bill over which there is no consensus in the government.

 The Forward Contract Bill  is essential for the development of commodities futures market as it aims to strengthen the FMC by providing it financial autonomy, facilitate the entry of institutional investors and introduce new products for trading such as options and indices.

 The Parliamentary Standing Committee had demand greater autonomy for FMC that also regulates the three spot online commodity exchanges — Financial Technologies-promoted National Spot Exchange Ltd (NSEL), the National Commodity & Derivatives Exchange-promoted NSpot and Ahmedabad-based National Multi Commodity Exchange (NMCE).

 It had also suggested allowing financial institutions and banks, mutual funds, and insurance companies to participate in forward market so as to ensure better price discovery and lower volatility.

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