The government might issue guidelines for the gold monetisation scheme, announced in the Union Budget 2015-16, by May, Finance Secretary Rajiv Mehrishi said on Monday. The scheme will replace the present gold deposit and gold metal loan schemes.
"We want to issue the guidelines as soon as possible. If you ask me time-frame realistically, I would say, I will be very happy if the guidelines will be issued by May but how much time it will take I don't know," Mehrishi told reporters at a press briefing conducted by him and Chief Economic Advisor Arvind Subramanian.
Finance Minister Arun Jaitley had proposed the scheme to curb gold imports and monetise large idle stocks of gold. The new scheme will allow depositors of gold to earn interest in their metal accounts and jewellers to obtain loans in their metal account. Banks would also be able to monetise the gold.
The move would also help in containing trade deficit and current account deficit. Gold imports in January had declined to 38 tonnes from 142 tonnes in April 2014. In 2012-13, the country had imported 845 tonnes.
Mehrishi also said the finance ministry will decide on the limits to be set for tax free infrastructure bonds, announced in the Budget within the next two months. Jaitley had proposed to raise funds for railways, roads and irrigation sectors by issuing tax-free infrastructure bonds. Tax payers are eligible to claim income tax deduction for investments in these long-term bonds. The issuance of bonds helps in channelising domestic savings into the infrastructure sector.
Jaitley had also said public investment to the tune of Rs 70,000 crore will be directed to infrastructure in 2015-16. Mehrishi clarified the sum will be distributed amongst roads, railways, Pradhan Mantri Gram Sadak Yojana, National Infrastructure and Investment Fund, and irrigation.
Mehrishi also said the government will form a committee, which will come out with structures that can be put in place to encourage use of credit or debit cards.
"We have formed a committee to look at what are the best ways to incentivise use of credit or debit cards. The committee will look at what structures can be put in place to encourage use of credit or debit cards," he said. This, too, was an announcement made by Jaitley in his Budget.
Mehrishi said, "Several things are in consideration, for example incentivising banks and to disincentivise cash transactions. For example, any expenditure by a person in a five star hotel above Rs 5,000 may have to be settled using credit card, there can be also decisions like that."
He also said the government is open to selling more than 51 per cent in certain loss making public sector entities as part of its 'strategic sale' through which it aims to collect Rs 28,500 crore next financial year.
"Strategic sale means that you are also looking for a strategic partner, not necessarily selling to retail investors," he said.
Source - Business-Standard
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