Gold Bonds To Go On Sale On Nov 26; Offer 2.75% Interest

The govt is aiming to raise Rs 150 bn via gold bonds; Minimum permissible investment will be two grams NEW DELHI : The government will issue sovereign gold bonds to domestic retail investors on Nov 26, the finance ministry said on Friday. The bonds with a tenor of eight years will carry an interest rate of 2.75% per annum payable semi-annually, the ministry said in a release. The government had announced the sovereign gold bond scheme in the Budget for 2015-16 (Apr-Mar) in a bid to channelize domestic investment demand for gold. The borrowing through gold bonds will form part of market borrowing programme of the government. "The bonds will be eligible for Statutory Liquidity Ratio," the government said, adding that the papers will be issued in tranches. "Each tranche will be kept open for a period to be notified. The issuance date will also be specified in the notification," the government said. The government is aiming to raise 150 bln rupees through gold bonds. "Minimum permissible investment will be two units i.e. two grams of gold. The maximum amount subscribed by an entity will not be more than 500 grams per person per fiscal year (April-March). A self-declaration to this effect will be obtained," the government release said. "The tenor of the bond will be for a period of eight years with exit option from fifth year to be exercised on the interest payment dates," it said. The bonds will be issued by the Reserve Bank India on behalf of the government. The redemption price will be in Indian Rupees based on previous week's simple average of closing price of gold of 999 purity published by India Bullion and Jewellers Association. Bonds will be sold through banks and designated Post Offices, either directly or through agents, the government said. Know-your-customer norms for gold bonds would be the same as for purchase of physical gold. The interest on gold bonds and the capital gains tax shall also remain same as in the case of physical gold.
Gold Bonds To Go On Sale On Nov 26; Offer 2.75% Interest Gold Bonds To Go On Sale On Nov 26; Offer 2.75% Interest Reviewed by Money99 on 13:33:00 Rating: 5

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