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RBI fixes gold bonds issue price at Rs. 2,600 per gram --GOLD BOND SCHEME PTI

RBI fixes gold bonds issue price at Rs. 2,600 per gram

The Reserve Bank has fixed the public issue price at Rs. 2,600 per gram for the sovereign gold bonds, for which applications will be accepted from Monday.
The second tranche of sovereign gold bonds and the pricing has been made more attractive as compared to the first tranche when the issue price was Rs. 2,684 per gram.
The first tranche of the scheme, which was launched in November, had got a subscription for 915.95 kg gold amounting to Rs. 246 crore.
“The issue price of the Sovereign Gold Bond for this tranche has been fixed at Rs. 2,600 per gram of gold,” RBI said in a statement. Applications for the bonds will be accepted for five days beginning January 18 to 22.
The rate has been fixed on the basis of simple average of closing price for gold of 999 purity of the previous week (January 11-15, 2016) published by the India Bullion and Jewellers Association Ltd (IBJA), it added.
Aimed at providing an alternative to buying physical gold, the gold bond scheme will offer investors an interest rate of 2.75 per cent and a choice to buy bonds worth 2 grams of gold, up to a maximum of 500 grams.
The bonds, which will be sold through banks, post offices and stock holding corporation, would be issued on February 8.
This is the second tranche of the gold bond scheme and subsequent tranches would be notified later.
The tenor of the bond will be for a period of eight years with exit option from 5th year to be exercised on the interest payment dates.
The interest earned on gold bonds would be taxable, and capital gains tax shall be levied as in case of physical gold.
The bonds can be bought by resident Indian entities including individuals, HUFs, trusts, universities and charitable institutions.
Yesterday Finance Minister Arun Jaitley asked the banks to make all efforts for success of the scheme.
(This article was published on January 15, 2016)

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