Here are 10 things to know about the two gold schemes:
1) The sovereign gold bond will enable investors to buy gold certificates from the government, which can later be encashed for money or physical gold.
2) Gold bonds will be issued with a rate of interest to be decided by the government. Interest will be calculated on the value of gold deposited at the time of investment.
3) Gold bonds will be issued in denominations of 5, 10, 50, 100 grams of gold. The cap per person per year has been set at 500 grams, the government said.
4) Duration of such gold bonds will be for minimum of 5 to 7 years to protect investors from medium term volatility in gold prices, the government said.
5) Gold bonds are expected to reduce the demand for physical gold bars and coins by shifting a part of estimated 300 tons per annum for investment into gold bonds.
6) The gold monetization scheme involves mobilization of tonnes of the yellow metal stored in households and temples.
7) The gold monetization scheme that will enable depositors to earn interest on their on their gold accounts. Under this scheme, the minimum quantity of gold that has to be deposited is at 30 grams.
8) The gold monetization scheme will cut down on imports, thus reducing foreign exchange outflows. According to estimates, India paid $34.32 billion to import around 930 tonnes of gold in the year ending March 2015.
9) Gold monetization scheme, in long term, will reduce country's reliance on the import of gold and put it to productive use, the government said.
10) Though stocks of gold in India are estimated to be over 20,000 tonnes, most of this gold is neither traded, nor monetized. Gold collected through the scheme will be made available to jewelers for manufacturing of new jewellery and other items.
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