WTI Crude

Loading...

Brent Crude

Loading...

Natural Gas

Loading...

Gasoline

Loading...

Heating Oil

Loading...

Rotate device for more commodity prices

Alt Text

Will Ecuador’s Mining Sector Return To Its Golden Days?

Despite the recent political problems…

Alt Text

Why Nevada Is The Next Lithium Hot Spot

As the Lithium market keeps…

Audacious Plan Here Will Have Massive Impact On Gold Markets

India's plans to reduce gold imports keep getting more ambitious. With news last week suggesting that the government is about to unveil a major plan aimed at curbing foreign bullion demand.

Local press report that a so-called "gold monetization" scheme is about to be announced by the national government. Which will allow the country's finance ministry to access some of the massive stores of gold held by private citizens across the country. Related: Coal Markets May Just Have Been Thrown A Lifeline

Here's how the plan will reportedly work. Holders of gold jewelry, coins, and bars will be able to deliver the metal to banks. Where it will be melted down and credited to the account of the holder.

Once the gold is deposited, the account holder will earn interest on the stored bullion. Providing an economic incentive to bring gold out of basements and attics, and essentially lend it to the central government. And it could happen soon, with finance officials telling The Economic Times, "The broad contours of the plan are ready. It would be made public in a week." Related: This Deal Could Completely Change North American Energy Dynamics

The government would thus gain access to a large supply of in-country gold. Which it reportedly plans to then lend out, in order to reduce the need for imported gold in meeting domestic demand.

The plan is an extension of an earlier-announced scheme to access large amounts of gold held by temples across India. Which promised a similar swap of interest payments for stored gold. Related: How Shale Is Becoming The .COM Bubble Of The 21st Century

There are no figures on the exact amount of gold held by private Indian citizens. But the numbers are generally recognized as being extremely high -- with jewelry particularly having long been used as a store of wealth beyond the banking system.

The gold monetization plan thus has the potential to significantly dent India's gold import demand -- which would be critical for the global bullion market. Watch for detailed announcements on the plan over the coming weeks.

Here's to going for gold,

Dave Forest

More Top Reads From Oilprice.com:




Back to homepage


Leave a comment
  • Elaisa on May 10 2015 said:
    The Indian Temples did not fall for that obvious bankster scam, neither will the people. The bankers are desperate for physical gold, and they will lie, cheat, and steal to get it.
  • dave on May 13 2015 said:
    the need to have the world gold accounted for is one step closer to the goal of one global currency. today it's India . A testing ground. Tomorrow the next , yet to be determined. Nation .Let's wait and see how this goes and then well be patient. As gold goes to the moon and were all holding worthless paper. They will be happy you did. Buy the paper that is.

Leave a comment




Oilprice - The No. 1 Source for Oil & Energy News