The Union Government of India has approved the Sovereign Gold Bond and Gold Monetization scheme.in order to monetize the estimated 20,000 tonnes of gold in households and temples of India, which is neither monetized nor traded ever.
Aim of the Schemes:
- Government imports 800-1000 tonnes of gold every year. This scheme will ease pressure on Trade Deficit.
- It will scrap existing Gold Deposit and Gold Metal Loan Scheme.
- Lenders can sell their Gold to generate Foreign Currencies.
- The Government will benefit from reduction in the cost of borrowing.
- To help Gems and Jewellery sector in the country by making it available Gold as a raw material on loan.
- Medium and long-term deposits can be used to replenish RBI’s gold reserves, auctioning, making coins and lending to jewellers. Short-term deposits will only be used for making coins and lending to jewellers
- The government will create a Gold Reserve Fund to bear risks arising out of variations in gold prices
Aim of the Schemes:
- Government imports 800-1000 tonnes of gold every year. This scheme will ease pressure on Trade Deficit.
- It will scrap existing Gold Deposit and Gold Metal Loan Scheme.
- Lenders can sell their Gold to generate Foreign Currencies.
- The Government will benefit from reduction in the cost of borrowing.
- To help Gems and Jewellery sector in the country by making it available Gold as a raw material on loan.
- Medium and long-term deposits can be used to replenish RBI’s gold reserves, auctioning, making coins and lending to jewellers. Short-term deposits will only be used for making coins and lending to jewellers
- The government will create a Gold Reserve Fund to bear risks arising out of variations in gold prices
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