• Amar G. Satijani
• Dr. Jaspal Gidwani
• Avinash Sahu

Sovereign gold bonds are papers or certificates issued by the Government of India indicating that investors bought the stated quantum (in grams) of gold. The value of the bond will be linked to gold prices. The objective of the scheme is to provide an alternative to buying physical gold. Since times immemorial, India has been a leading consumer of gold in the world with an ever-increasing demand for the metal. However, due to a shortage of domestic gold, the country has largely been dependent on gold imports to meet this demand, resulting in large current account deficits. Gold monetization can be one of the lucrative investment options. It is all about fixed deposit scheme for gold, earning interest. The objective of launching the two schemes is to lure Indians away from buying physical gold which remains passive and serves no economic purpose. As estimated, about 22,000 tonnes of gold (which when converted to currency will be precisely around Rs. 60 lakh crores), are held by households and institutions. In a country like India, where liquidity is the key to drive economic growth, money worth of Rs. 60 lakh crores remaining idle, does not augur well. Besides, in spite of having such big gold holdings, our appetite for the yellow metal has been on rise. This not only makes India the biggest consumer but also the biggest importer of gold in the world affecting our Balance of Payments adversely. Gold and crude oil import comprises of 65% of the total import bills, which has been the main reason behind rising current account deficit. Gold monetization and Gold sovereign bond schemes will be of great help to the country’s economy. Through a literature survey, this study attempts to identify and analyse the challenges that inhibit the scheme from realizing its full potential. The study concludes with recommendations to enhance adoption of the scheme by households and individual investors.

Gold, Gold monetization schemes, Sovereign Gold Bond, Investment, Gold ETF.

"Gold Saving Scheme: An unusual way of investing in Gold thrust on Sovereign Gold Bond Scheme (SGBs)", International Journal of Emerging Technologies and Innovative Research (www.jetir.org), ISSN:2349-5162, Vol.5, Issue 1, page no.700-705, January-2018, Available :http://www.jetir.org/papers/JETIR1801135.pdf

"Gold Saving Scheme: An unusual way of investing in Gold thrust on Sovereign Gold Bond Scheme (SGBs)", International Journal of Emerging Technologies and Innovative Research (www.jetir.org | UGC and issn Approved), ISSN:2349-5162, Vol.5, Issue 1, page no. pp700-705, January-2018, Available at : http://www.jetir.org/papers/JETIR1801135.pdf