The central government led by prime minister Modi came up with the gold bond scheme in 2015 with the aim of reducing gold imports, thinking that if people buy gold as bonds instead of buying it as metal, they could reduce imports. The central government also announced that it would pay 2.75 percent interest per annum. It encouraged people to invest in gold bonds instead of buying gold as jewelry. Due to this, the people gave a strong welcome to the gold bond scheme. However, the gold bond scheme did not control its main objective, which was to control imports. Moreover, the price of gold has been rising at an alarming rate, which has caused a huge financial burden on the central government. The gold bond scheme looked good on paper, but in reality, it has turned into a scheme that has caused huge losses to the government. The central government seems to have belatedly realized that the scheme cannot be continued due to increasing liability and financial pressure. As a result, the government has not issued any new gold bonds since the financial year 2024-25.
So far, the central government has issued a total of 67 gold bonds equivalent to 147 tonnes of gold. The maturity period of the gold bonds is 8 years. However, in case of urgent need, the investment made in the gold bond can be withdrawn after 5 years from the date of investment. In this regard, the reserve bank of india has now announced the prepayment of the 2 series of the gold bond scheme dated april 23.This applies to Series IV of the year 2017-18 and Series II of the year 20218-19. These gold bonds were issued on october 23 of the respective year. The early redemption price for investors in these bonds has been fixed at Rs. 9,669 per unit. This price has been calculated from the average of the closing prices of 999 pure gold issued by indian jewelers in the past few days (April 17, 21, 22).

If investors want to withdraw their investment in gold bonds before the eight-year maturity period, they can choose to sell them in the financial market or opt for the Reserve Bank's scheduled early redemption process. Depending on where these bonds are kept, the investment can be withdrawn through several channels, including banks, post offices, or stock exchanges.
For more interesting updates wa click and follow Indiaherald WhatsApp channel

Find out more:

Sowmiya Sriram

24/04/2025 02:36 PM