Prime minister Manmohan Singh has decided to tighten the monitoring over the 22 commodity markets, including the scam-tainted National Spot Exchange Limited (NSEL) of Jignesh Shah, by placing them under the watchful eyes of the securities exchange board of India (Sebi). The forward market commission (FMC), the watchdog for these 22 exchanges, will now be under the finance ministry instead of the consumer affairs ministry.

This move was apparently not discussed within the union cabinet or the cabinet committee for economic affairs. However, the PM decided to keep the matter to himself and signed the file before flying off to the G-20 Summit. The file has been sent to the president for his approval and formal announcement is expected in a couple of days.

When contacted, consumer affairs minister KV Thomas confirmed. “Yes. I had written to the PM that all commodity exchanges governed by FMC and related bodies be transferred to the finance ministry.”

Thomas said his ministry never had “any mechanism” to govern the commodity exchanges . The FMC too was finding it difficult to launch any criminal investigation as it had no powers. “We don’t have the wherewithal to manage the commodity business,” he said, adding that the Sebi had the necessary powers and experience to regulate this usiness.

Nitty-gritties of the move are being worked out. The key question is whether FMC become part of Sebi or function as a separate wing of it.