Letter to BS: RBI expands ambit of the gold-monetisation scheme

This refers to the report “RBI expands ambit of gold-monetisation scheme” (January 10). The revised instructions give a new avenue for productive deployment of idle domestic gold stock. This is a welcome move by the Reserve Bank of India (RBI). The new entities that have become eligible to invest their gold stock under the scheme need to be educated about the advantages of mainstreaming their gold stock. The issues of trust, faith, emotion and sheer laziness to take responsibility need to be addressed with care and deftness. 

Past experience shows, organisations do not spontaneously volunteer to part with gold, even if the investment fetches substantial returns. Perhaps, Tirupati is the only temple that earns substantial income from gold deposits. Other temples/religious bodies are sometimes secretive about even the quantity of gold in their vaults. The governments’ eye on every asset as an income source (read tax) also is behind this fear complex.

If the Centre is serious, massive efforts will have to be made to create awareness among the people about the benefits. The availability of sovereign guarantee for the gold invested, professional handling of the conversion of gold and timely payment of interest and return of gold or value of gold, will have to be publicised in a business-like manner.

M G Warrier  Mumbai

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