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Draft Sovereign Gold Bond Scheme

Start Date :

Jun 17, 2015

Last Date :

Jul 02, 2015

17:00 PM IST (GMT +5.30 Hrs)

Submission Closed

The Finance Minister in his budget speech for the Union Budget 2015-16 made the following announcement: ...

The Finance Minister in his budget speech for the Union Budget 2015-16 made the following announcement:

“India is one of the largest consumers of gold in the world and imports as much as 800-1000 tonnes of gold each year. Though stocks of gold in India are estimated to be over 20,000 tonnes, most of this gold is neither traded, nor monetized. I propose to… develop an alternate financial asset, a Sovereign Gold Bond, as an alternative to purchasing metal gold. The Bonds will carry a fixed rate of interest, and also be redeemable in cash in terms of the face value of the gold, at the time of redemption by the holder of the Bond.

Accordingly, a draft outline of the Scheme has been prepared. Comments and views are invited on the draft scheme by 2nd July, 2015.

(The outline of the Sovereign Gold Bond Scheme is only at the draft stage and is being placed here to obtain public opinion. The scheme as it stands at this stage, does not imply any commitment from the government)

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K_Jha 10 years 9 months ago

Scheme may be good but for better success of this scheme, one should also consider the Indian Mind set who keep their Gold as Jwellary and having Emotional attachment with Jwellary. For this , two option can be created.... 1) If any one is ready to handover their jewelary for Melting- Interest rate should be double 2) If Any one is emotionally attach with Jewelry & Gold and unable to accept the melting of Jewelry/Gold, they will get half benefit of 1 st. 3) Other criteria- Gold Purity

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vinod patel_3 10 years 9 months ago

In my comment replaced the word mid conduct to misconduct rule

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vinod patel_3 10 years 9 months ago

My idea is about corruption as ACB required to seek the corruption as police department look mid conduct with or without complain by citizens...

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Dip Narayan Sarkar 10 years 9 months ago

It will definitely help to cut importing of gold. But the tax on capital gain to be looked into for making the Bond more attractive.

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Krishnan Srikanth 10 years 9 months ago

This is a good method to eradicate black money invested in gold if the soource of money is not asked. So the huge ransom of black money and its holders will gain confidence Government and invest with assured returns. So it's a mutual benefit to the govt and black money holders. BY investing in this system their money becomes white or rather comes into the circulation of white economy. This corculation is needed for our Economy. Slowly bring in Cashless society to avoid black money creation.

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pravin prajapati_2 10 years 9 months ago

government's sovereign gold bond loan scheme is such a helpfull mainly to middle class rural families.it is new initiative for them to create money when they needed.

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SHARMILA SOLANKI 10 years 9 months ago

This scheme will give a major fillip to the rural people of India who have no other avenue other than gold as a savings instrument and store of capital. This gold is prone to adulteration, lower realisation while liquidating, safekeeping issues etc. In this light the comoodity exchange route becomes useful. NCDEX exchange has a very good network and penetration in rural economy for farm commodities. Hence they will be able to reach the farmers better. Other metal exchanges have no relevance.

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m d rajendra jain 10 years 9 months ago

SEBI has risk management guidelines for protecting investors. As RBI will be the agency issuing the Sovereign Gold Bonds, RBI should declare its risk management measures to the Govt./PAC. For investors it is GoI/RBI's guarantee to redeem as promised. Among all measures to control Forex outgo on gold imports, GoI should also devise an ingenious scheme to import gold on rupee terms which would make gold smuggling out of business. China is buying out gold mines in Africa, India also shld do so

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Nazir Ahmed Moulvi 10 years 9 months ago

Govt. initiative to launch Gold Bonds is laudable. However, it needs to rethink taking NCDEX prices for reference for following reasons MCX has a market share of around 98 percent in domestic gold futures market Globally MCX ranks No 3# in gold futures All gold physical market transaction in India is benchmarked to MCX prices MCX is the only exchange in India which has a consistent history of enabling gold futures trading Hence MCX prices should only be the benchmark for Gold Bonds

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Niteen M Jain 10 years 9 months ago

While the rationale of the scheme is quite noble, certain finer aspects need introspection: 1. However small may be gold prices exposure, ignoring hedging could not only prove costly but may also instill doubts on the efficacy of all future potential schemes; 2. Price referencing need to be undertaken w.r.t to MCX gold prices. MCX gold prices are not only well-accepted by bullion industry in the country but also are a time-tested series with a successful history of more than a decade.

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