UPSC Prelims 2016 Question:

What is/are the purpose/purposes of the Government's ‘Sovereign Gold Bond Scheme’ and ‘Gold Monetization Scheme’?

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.

Explanation: Sovereign Gold Bond Scheme was launched by Govt in November 2015, under Gold Monetisation Scheme.

• India has an estimated 20,000 tonnes of gold lying idle with Indian households and institutions. The above two schemes are aimed at bringing the gold lying with citizens into the economy, and at reducing India’s dependence on gold imports. So, points 1 and 3 are correct.
  
  
• Person resident in India as defined under Foreign Exchange Management Act, 1999 are eligible to invest in SGB. Eligible investors include individuals, HUFs, trusts, universities and charitable institutions. FDI under this scheme is not allowed in the gold and jewellery sector. So, point 2 is not correct.
  
  

Therefore, option (3) is the correct answer.

Relevance: In November 2015, Government of India launched the Sovereign Gold Bond Scheme.

Subject: Economics | Indian Economy