Gujarat Global News Network, New Delhi
Government of India has decided to issue Sovereign Gold Bonds 2017-18 – Series II. Applications for the bond will be accepted from July 10, 2017 to July 14, 2017. The Bonds will be issued on July 28, 2017.
The Bonds will be sold through banks, Stock Holding Corporation of India Limited (SHCIL), designated post offices and recognised stock exchanges viz., National Stock Exchange of India Limited and Bombay Stock Exchange.
The bonds will be denominated in multiples of grams of gold with a basic unit of 1 gram. The tenure of the bond will be for a period of 8 years with exit option from 5th year to be exercised on the interest payment dates. Minimum permissible investment will be 1 gram of gold. The maximum amount will be not more than 500 grams per person per fiscal year ( April- March). A self declaration to this effect will be obtained. Price of Bond will be fixed in Indian Rupees on the basis of simple average of closing price of gold of 999 purity published by the India Bullion and Jewellers Association Limited for the week (Monday to Friday) preceding the subscription period. The issue price of the Gold Bonds will be ` 50 per gram less than the nominal value.
Payment for the Bonds will be through cash payment (upto a maximum of Rs. 20,000) or demand draft or cheque or electronic banking. The redemption price will be in Indian Rupees based on previous week’s (Monday-Friday) simple average of closing price of gold of 999 purity published by IBJA.
The investors will be compensated at a fixed rate of 2.50 per cent per annum payable semi-annually on the nominal value. Bonds can be used as collateral for loans. The loan-to-value (LTV) ratio is to be set equal to ordinary gold loan mandated by the Reserve Bank from time to time.
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