A programme to attract gold owned by households into a bank deposit scheme to monetise the precious metal could be ready in weeks, Prime Minister Narendra Modi said on Sunday, a step aimed at cutting expensive imports.
India’s Gold Monetisation Scheme along with a few others, could be in place before Dhanteras ahead of Diwali — when it is considered auspicious to buy gold — he indicated.
“Gold can be converted from dead money to a living force. This is what we want to do and I seek your support,” he said.
The gold monetisation scheme
This week, the Reserve Bank of India has issued norms for implementation of the gold monetisation scheme, under which customers can deposit their gold in banks and earn interest on it.
The minimum deposit required will be 30 grams of the precious metal of 995 fineness. It could include raw gold in the forms of bars, coins and jewellery, excluding stones and other metals, the RBI said.
There is no maximum limit for deposit under the scheme.
On maturity, the principal on maturity and interest will be linked to the prevailing price of gold at the time. The depositor will have the option to take gold or equivalent rupees.
The scheme is meant to mobilise part of the estimated 20,000 tonnes of gold held by Indian homes and institutions and reduce India’s reliance on the import of gold.
According to a study, Indian households spend 8% of their daily consumption on the gold jewellery such as daily wear jewellery, wedding jewellery, get name necklace Jewelry etc. Recently there is also a high demand for collectables items like fingerprint jewelry.
India to mint own gold coins
The prime minister also said India will mint its own gold coins which will carry the Ashok Chakra emblem. The coins will be of 5 gm and 10 gm in weight. Besides, India will also introduce its own gold bullion.
“It has been 70 years after Independence and still we are using foreign minted gold coins and bullion. Why can’t we have our own?” he said, adding this too, which will be done before dhanteras.