Niti Aayog for considering deposits under gold monetization scheme as CRR

• The government think-tank Niti Aayog has suggested that deposits mobilized by banks under the Gold Monetization Scheme should be included in the cash reserve ratio.

• In a report, the committee headed by Niti Aayog Principal Advisor Ratan P Watal also recommended that the transfer of gold collected under the scheme (GMS) should be exempt from the purview of GST.

• It further said the government could consider initially setting up a Bullion Exchange in GIFT-IFSC to be an additional option in the choice of venue for trade for the global market participants and to be the primary intermediary for all gold imports and exports.

• In 2015, the government launched the GMS with the objective of mobilizing the gold held by households and institutions in the country.

• The scheme allows bank’s customers to deposit their idle gold holdings for a fixed period in return for an interest in the range of 2.25 percent to 2.50 percent.

• Recently, the RBI had made changes in the Gold Monetization Scheme to make it more attractive.

• The revamping of the scheme was aimed at enabling people to open a hassle-free gold deposit account.

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