Sovereign Gold Bond Scheme 2022-23

Context: The Reserve Bank of India (RBI) has announced the Sovereign Gold Bond Scheme 2022-23 – Series III, which will be open for subscription during December 19-23, 2022.

About Sovereign Gold Bond Scheme:

• The Government Sovereign Gold Bonds (SGB) Scheme was introduced in November 2015.
• SGBs are provided as a substitute for physical gold to investors.
• The main objective of the scheme is to reduce the demand for physical gold and shift a part of the gold imported every year for investment purposes, into financial savings through Gold Bonds.
• SGBs are issued by RBI on behalf of the Government of India on payment of the required amount in rupees and are denominated in grams of gold.
• The Bonds are restricted for sale to resident Indian entities including individuals, HUFs, trusts, Universities, charitable institutions.
• Minimum permissible investment is 2 grams of gold to be paid in rupees. The maximum amount subscribed by an entity will not be more than 500 grams per person per fiscal year (April-March).
• The bonds are available in both in Demat and paper form. The rate for the Bonds is fixed on the basis of simple average of closing price for gold of 999 purity of the previous week published by the India Bullion and Jewellers Association (IBJA).
• The tenor of the Bond is for a period of 8 years with exit option from 5th year onwards to be exercised on the interest payment dates.
• Exemption from capital gains tax is also available. Long term capital gains arising to any person on transfer of SGB is also eligible for indexation benefits.
• On maturity, the investor will get the equivalent rupee value of the quantum of gold invested at the then prevailing price of gold.

Source: Indian Express

Previous Year Questions

Q.1) What is/are the purpose/purposes of the Government’s ‘Sovereign Gold Bond Scheme’ and ‘Gold Monetization Scheme’? (2016)

1. To bring the idle gold lying with Indian households into the economy
2. To promote FDI in the gold and jewellery sector
3. To reduce India’s dependence on gold imports

Select the correct answer using the code given below.

1. 1 only
2. 2 and 3 only
3. 1 and 3 only
4. 1, 2 and 3