New Delhi: India’s Finance Minister Mr. Arun Jaitley has once again disappointed the jewellery industry by maintaining status quo on the gold import duty which is prevailing at 10%. On the contrary he preferred to put a check on import of the yellow metal by proposing to introduce gold deposit accounts to utilize the 20,000 tons available within the country and launch a sovereign bond as an alternative to buying the metal.

India ships in 800-1,000 tonnes of gold a year despite massive stocks in the country that is neither traded nor monetized, Mr. Jaitley said while presenting the country’s annual budget for 2015-16 in the Parliament today.

Without setting a timeline, Jaitley said the government will introduce a gold monetization scheme which will replace the present gold deposit and gold metal loan schemes.

Gold depositors will earn an interest on their metal account, while jewellers can obtain loans in it. Banks and other dealers will be able to monetize this gold.

The government will also develop a sovereign gold bond as an alternative to purchasing gold. The bonds will carry a fixed rate of interest and holders will be able to redeem them in cash on the face value of gold.

Jaitley said work will also start on an Indian gold coin to cut demand for foreign-minted coins. “Such an Indian gold coin would help reduce the demand for coins minted outside India and also help to recycle the gold available in the country,” he said.