Gold Schemes in India
Prime Minister Modi recently launched three gold related schemes, namely the Gold Monetization Scheme, Sovereign Gold Bond Scheme and the Gold Coin and Bullion Scheme.
These schemes were aimed at reducing the demand of physical gold and luring the customers to introduce the same in the banking systems. These schemes are also important because it is one of its own kind and it has the capability to reach to the one of the Gold Reserves of the country i.e. Households.
Let us discuss the schemes in detail as it may come in upcoming exams.Some important provisions of the Gold Monetization Scheme and Sovereign Gold Bond Schemes are:
| Particulars | Gold Monetization Scheme | Sovereign Gold Bond Scheme |
| History | Replacement of existing GDS | New Investment option introduced by Government of India |
| Who can invest | Residents Indians, Trusts including Mutual Funds/Exchange Universities/Charitable Traded Funds registered under institutions SEBI (Mutual Fund) Regulations and Companies | Resident Indians, Trusts |
| Investment Process | The Gold ornaments are melted and purity is assessed. Certificates issued to the investor is used to open the Gold Saving Account | Purchase Gold Bonds instead of physical gold. Gold could be held in paper format or demat form |
| Minimum Investment | 30 grams of raw gold (bars, coins, jewellery) | 2 units (i.e. 2 grams of gold) |
| Maximum Investment | No maximum limit | 500 grams per person per fiscal year |
| Minimum Tenure | 1 year | 8 years, with an exit option from the 5th year |
| Types of Deposits | Short Term Bank Deposits (1 – 3 years) Medium (5 – 7 years ) And Long (12 – 15 years) Government Deposit Schemes |
No Classification of the bonds |
- KYC – a must, but income is tax-free
- Will be melted, but returned as gold
- Fixed deposit, but can break it for a fee
- Interest nominal, but it is on gold weight
Gold Sovereign Bond
- Earns you interest
- Minimal charges
- Better liquidity
Under the Gold Coin and Bullion Scheme, the government will issue gold coins, the first ever national gold coins, which will have the Ashok Chakra engraved on them.
