The government can close the Sovereign Gold Bond (SGB) scheme or reduce its installments. A person associated with this case told this. Union budget The government can take this step after a decrease in custom duty on gold and silver. The government has reduced custom duty on gold and silver from 15 percent to 6 percent. This is expected to reduce the demand for Sovereign Gold Bond. After the reduction in custom duty, SGB prices fell by 2-5 per cent on the National Stock Exchange (NSE). The Sovereign Gold Bond Scheme began in 2015.
The first installment came in 2015
The first installment of SGB came on 30 November 2015. It matured in November 2023. The 2016-17 series of the SGB scheme came on 1 August 2016. The series is going to mature in August 2024. The original issue price of ACGB was Rs 3,119. It was 2.75 percent interest annually. The calculation of SGB’s redemption price is based on the average closing price of 999 purity gold, three days before the date of redemption.
Risk attractive returns from SGB
A senior government official said, “We have given 9-11 percent returns annually. Apart from this, an interest of 2.5 percent has also been received.” Currently, the interest rate on SGB is 2.5 percent. ACGB’s maturity period is 8 years. During this time its interest rate is fixed. Interest is transferred to investor account every six months. A financial expert said, “Mutual funds give you about 10-11 percent return annually, while it has a risk. There is no risk in SGB. This scheme is very attractive.”
Custom duty has increased on gold in last years
In the last years, the government has increased import duty on gold. In the budget 2012-13, it was increased from 2 per cent to 4 per cent. In 2013, the government increased import duty on gold jewelery from 10 per cent to 15 per cent. The government gave many reasons for this. He said that this has been done in view of curbing gold smuggling and increasing the increasing current account deficit. However, the government had to withdraw it later.