"The Cabinet approved the proposal to move official amendments to the Forward Contracts Regulation (FCRA) Amendment Bill, 2010," Finance Minister P Chidambaram briefed media after the meeting.
He said he proposed amendments are largely based on the suggestion of the Parliamentary Standing Committee.
"The Bill will give more teeth to Forward Market Commission (FMC). Farmers will also be benefited," Food Minister K V Thomas told PTI.
The amendment Bill, introduced in Lok Sabha in December 2010, is likely to come for the passage in next session of Parliament, he said.
"After the Bill is passed and enacted by Parliament, FMC as a regulator will get autonomy and power to regulate the market effectively. New products like 'options' will be allowed in the commodity market," an official statement said.
The Bill seeks to give financial autonomy to FMC by allowing it to levy fee for generating revenue and hire professionals to strengthen its human resource.
The other salient features of the Bill include setting up of an Appellate Authority to guard against arbitrary regulatory decisions and penalty hike on defaulters to Rs 50 lakh from the existing Rs 25 lakh.
The Bill also seeks to increase number of members of the Commission from four to nine and also raises the term of members and chairman from 60 years to 65 years.
The Bill is vital for further development of commodity futures market, which touched Rs 181 lakh crore last fiscal from participation of 21 bourses.
