Government, in consultation with the Reserve Bank of India, decides to issue Second Tranche of Sovereign Gold Bonds Scheme 2016
Government, in consultation with the Reserve Bank
of India, decides to issue Second Tranche of Sovereign Gold Bonds Scheme 2016;
Applications for the bonds to be accepted from 18th January to 22nd January,
2016; Bonds to be issued on February 8, 2016 and will be sold through banks,
Stock Holding Corporation of India Limited (SHCIL) and designated post offices.
The Government
of India, in consultation with the Reserve Bank of India, has decided to issue
second tranche of Sovereign Gold Bonds. Applications for the bonds will be accepted
from January 18, 2016 to January 22, 2016. The Bonds will be issued on February
8, 2016. The Bonds will be sold through banks, Stock Holding Corporation of
India Limited (SHCIL) and designated post offices. The borrowing through
issuance of the Bond will form part of market borrowing programme of the
Government of India.
It may be recalled that Honourable
Finance Minister had announced in Union Budget 2015-16 about developing a
financial asset, Sovereign Gold Bond, as an alternative to purchasing metal
gold. Accordingly, the first tranche was open for subscription from November
05, 2015 to November 20, 2015. The features of the Bond are given below:
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Sl. No
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Item
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Details
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1
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Product name
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Sovereign Gold Bond 2016
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2
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Issuance
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To be issued by Reserve Bank India on behalf of the Government of
India.
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3
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Eligibility
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The Bonds will be restricted for sale to resident Indian entities
including individuals, HUFs, trusts, Universities and charitable
institutions.
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4
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Denomination
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The Bonds will be denominated in multiples of gram(s) of gold
with a basic unit of 1 gram.
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5
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Tenor
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The tenor of the Bond will be for a period of 8 years with exit option
from 5th year to be exercised on the interest payment dates.
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6
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Minimum size
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Minimum permissible investment will be 2 units (i.e. 2 grams of gold).
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7
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Maximum limit
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The maximum amount subscribed by an entity will not be more than 500
grams per person per fiscal year (April-March). A self-declaration to this
effect will be obtained.
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8
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Joint holder
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In case of joint holding, the investment limit of 500 grams will be
applied to the first applicant only.
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9
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Frequency
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The Bonds will be issued in tranches. Each tranche will be kept open
for a period to be notified. The issuance date will also be specified in the
notification.
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10
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Issue price
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Price of Bond will be fixed in Indian Rupees on the basis of the
previous week’s (Monday–Friday) simple average of closing price of gold of
999 purity published by the India Bullion and Jewellers Association Ltd.
(IBJA).
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11
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Payment option
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Payment for the Bonds will be through cash payment upto a maximum of
Rs. 20,000 or demand draft or cheque or electronic banking.
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12
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Issuance form
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Government of India Stock under GS Act, 2006. The investors will be
issued a Holding Certificate. The Bonds are eligible for conversion into
demat form.
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13
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Redemption price
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The redemption price will be in Indian Rupees based on previous week’s
(Monday-Friday) simple average of closing price of gold of 999 purity
published by IBJA.
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14
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Sales channel
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Bonds will be sold through banks, SCHIL and designated Post Offices,
as may be notified, either directly or through agents.
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15
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Interest rate
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The investors will be compensated at a fixed rate of 2.75 per cent per
annum payable semi-annually on the initial value of investment.
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16
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Collateral
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Bonds can be used as collateral for loans. The loan-to-value (LTV)
ratio is to be set equal to ordinary gold loan mandated by the Reserve Bank
from time to time.
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17
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KYC Documentation
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Know-your-customer (KYC) norms will be the same as that for purchase
of physical gold. KYC documents such as Voter ID, Aadhaar card/PAN or
TAN /Passport will be required.
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18
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Tax treatment
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The interest on Gold Bonds shall be taxable as per the provision of
Income Tax Act, 1961 (43 of 1961) and the capital gains tax shall also remain
same as in the case of physical gold.
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19
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Tradability
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Bonds will be tradable on exchanges/NDS-OM from a date to be notified
by RBI.
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20
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SLR eligibility
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The Bonds will be eligible for Statutory Liquidity Ratio.
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21
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Commission
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Commission for distribution shall be paid at the rate of 1% of the
subscription amount.
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*******
Finance Minister Shri Arun Jaitley: Asks all the
banks to make their best efforts to reach-out to potential investors to invest
in the Second tranche of the Sovereign Gold Bonds which will be kept open from
18th January, 2016 to 22nd January, 2016
The Union Finance Minister Shri Arun Jaitley asked all
the banks to make their best efforts to reach-out to potential investors to
invest in the Second tranche of the Sovereign Gold Bonds which will be kept
open from 18th January, 2016 to 22nd January,
2016. He said that this is an attractive opportunity for the investors. The Finance
Minister was addressing the CMDs of the banks through video conferencing here
today. He also discussed the banks’ preparedness for the second tranche of
the Sovereign Gold Bond Scheme. He said that the Government is
keen to expand the scheme in the subsequent tranches as well. This was followed
by a review by Shri Shaktikanta Das, Secretary, Department of Economic Affairs
(DEA) with all the CMD’s of the Banks. All the banks assured to activate
their branch network to inform the investors about the advantages of the bonds.
To increase the awareness among
depositors, the Government is continuing with the Media campaign on AIR and FM
radio, in print media and through Mobile SMS campaign. Information is also
available on the website www.finmin.nic.in/swarnabharat and
on the toll free number 18001800000.
The First Tranche of Sovereign
Gold Bond (SGB) was issued on behalf of the Government of India by RBI at
the branches of scheduled commercial banks and designated post offices through
its e-kuber system from 5th November, 2015 to 20th November,
2015 . A total of 62169 applications were received for a total
subscription of 915.953 Kilograms of gold amounting to Rs 246.20 Cr by the
Banks and Post Offices.
Earlier, the Government had launched Sovereign Gold Bond on 5th November,
2015. The main objectives of the scheme is to reduce the demand for
physical gold and shift a part of the gold imported every year for investment
purposes into financial savings through Gold Bonds.
Sovereign Gold Bonds are issued by RBI
on behalf of the Government of India on payment of the required amount in
rupees and are denominated in grams of gold. The Bonds are restricted for sale
to resident Indian entities including individuals, HUFs, trusts, Universities,
charitable institutions. Minimum permissible investment is 2 grams of gold to
be paid in rupees. The maximum amount subscribed by an entity will not be more
than 500 grams per person per fiscal year (April-March). Government has fixed
the rate of interest for the year 2015-16 as 2.75 % per annum , payable on a
half yearly basis. The bonds will be available both in demat and paper
form. The rate for the Bonds will be fixed on the basis of simple average of
closing price for gold of 999 purity of the previous week published by the
India Bullion and Jewellers Association (IBJA). These bonds will be available
at Banks and Post Offices. The tenor of the Bond will be for a period of 8
years with exit option from 5th year onwards to be exercised on the interest
payment dates. KYC norms will be the same as that for gold. Exemption from
capital gains tax will also be available. On maturity, the investor will
get the equivalent rupee value of the quantum of gold invested at the then
prevailing price of gold.
********
Government Approves Five (5) Proposals of Foreign
Direct Investment (FDI) Amounting to Rs. 6050.10 Crore Approximately
Based
on the recommendations of Foreign Investment Promotion Board (FIPB) in its 229th meeting
held on 21st December 2015, the Government has approved five
(05) proposals of Foreign Direct Investment (FDI) amounting to Rs. 6050.10
crore.
The following five (05) proposals
have been approved:
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S. No.
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Item No
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Name of the applicant
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Gist of the proposal
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Sector
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FDI (in Rs. Crore)
|
|
1
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5
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M/s Sai Life Sciences Limited
|
Approval has been sought for :-
Alpha TC Holdings Pte. Ltd to transfer its
shares held in Sai Life to its WoS Alpha FDI Holdings Pte Ltd and
deletion of condition of compounding by the Reserve Bank of India imposed in
the approval letter dated 14.08.2015
|
Pharma
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Nil
|
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2
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8
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M/s Health Media Publishing M/s Private Ltd
|
Approval has been sought for the transfer of its
99.90% shares currently held by Mr Ajit Patel, an NRI to Wellness Technology
and Media Private Ltd, UK.
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Print media
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Nil
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3
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9
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M/s Recipharm Participation B.V
|
Approval has been sought for :-
1. Incorporating a WoS in India, which will be
engaged in the business of investing in other companies.
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Pharma
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1050
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|
|
|
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2. Making downstream investment through the WoS
(as mentioned above) in an existing pharmaceutical manufacturing company,
Nitin Lifesciences Limited, by buying out shares from the promoters thereby
increasing foreign equity to 74%.
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4
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11
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M/s Buimerc Core Investments Private Limited
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Approval has been sought by M/s Buimerc Core
Investments Private Limited for transferring of 100% equity shares of NRI
investors and Resident Investors to Buimerc Corporation FZE.
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CIC
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0.10
|
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5
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16
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M/s Cadila Healthcare Ltd.
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Approval for fresh equity infusion of up to Rs.
5000 Crores under FDI Route by QIBs through Qualified Institutional
Placement under Chapter VIII (QIP) of SEBI ICDR Regulations on a Private
Placement basis for the expansion of the business.
|
Pharma
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5000
|
The
following six (06) proposals have been deferred:
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S. No.
|
Item No
|
Name of the applicant
|
Gist of the proposal
|
Sector
|
|
1
|
1
|
M/s Gulf Quarry General
Trading F.Z.C.
|
Approval has been sought
for investment in a new factory in Amritsar for crushing of gypsum rocks to
make gypsum powder, manufacturing of gypsum board etc in an Indian company
which is yet to be incorporated.
|
Mining
|
|
2
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2
|
M/s International Asset
Reconstruction Company Private Limited
|
Approval has been sought
for purchase of its shares by KKR India Reconstruction Pte. Ltd, Singapore,
thereby increasing the foreign equity from 58.75% to 78.96%.
|
Financial services
|
|
3
|
4
|
M/s Raheja QBE General
Insurance Company Limited
|
approval for transfer
of 23% shares currently held by Prism Cement Limited to QBE Asia
Pacific Holdings Limited, Hong Kong, thereby increasing the foreign
shareholding in the company from 26% to 49%.
|
Insurance
|
|
4
|
10
|
M/s Equitas
Holdings Private Limited
|
Approval has been sought
by M/s Equitas Holdings Private Limited for undertaking an IPO in accordance
with the provisions of the SEBI ICDR 2009. The Issue comprises a fresh issue
and an offer for sale of Equity Shares by certain existing shareholders to
eligible non-resident investors including FIIs/FPIs/NRIs.
|
CIC
|
|
5
|
13
|
M/s HSBC Securities and
Capital Markets (India) Private Limited
|
Approval has been sought
for: -
I. Merger of the FIPB approval letter of even no FCII 229(1994)/300(1994) dated 13.05.1994 (read along with 18 amendments) and Approval letter of even no FC II 160(2005)/157(2005) dated 21.06.2005.
II. Incorporating a
Wholly Owned Subsidiary (WoS) which will act as a trustee company to HSBC
Mutual Fund.
III. HSBC InvestDirect Financial Services(India) Limited[WoS of HSBC Invest Direct (India) Ltd] to engaged into additional activities |
NBFC
|
|
6
|
17
|
M/s Holcim (India)
Private Limited
|
Approval sought by M/s
Ambuja Cements Ltd., for the acquisition of 24% shares in its holding
company, Holcim (India) Pvt Ltd from the latter’s holding company M/s
Holderind Investments Ltd (NR) and subsequent reverse merger through a share
swap.
|
Investing
|
The following two (02) proposals have been rejected:
|
S. No.
|
Item No
|
Name of the applicant
|
Gist of the proposal
|
Sector
|
|
1
|
7
|
Mr. Mokeme Chiwetal Izuchukwu, Nigeria
|
Approval has been sought to set up a Limited
Liability Partnership (LLP) in India for Cash & Carry Wholesale
Trading/Wholesale Trading (Including sourcing from MSEs).
|
LLP
|
|
2
|
12
|
M/s Lanarth Developers Private Limited
|
Approval has been sought by Lanarth Developers
Private Limited for the extension of period of redemption for 10,80,000
(11.25%) Preference shares of Rs.100/- issued to its existing foreign
shareholder Baniyas International Private Limited maturing on March
30, 2015 by three years i.e. on and upto March 30, 2018
|
Construction
|
The following three (03) proposals do not lie before
FIPB:
|
S. No.
|
Item No
|
Name of the applicant
|
Gist of the proposal
|
Sector
|
|
1
|
06
|
M/s Elanco India Private
Limited
|
Approval has been sought
for further foreign investment of USD 5 million to 10 million over the next
2 to 3 years from its existing shareholders (via a rights issue) i.e. M/s
Elanco Nederlands Holding B.V and M/s Lilly Nederlands Holding B.V at
regular intervals in tranches.
|
Pharma
|
|
2
|
14
|
M/s Datamark Prodapt
India BPO Private Limited, Chennai
|
The approval has been
sought for change into its designated partner who has acquired 0.02%
of shares of the company resulting change into the shareholding pattern of
the company
|
LLP
|
|
3
|
15
|
M/s Volvo Asset Finance
lndia Pvt Ltd
|
An NBFC has proposed to
offer operating lease to its customers, for which company has been advised
to seek FIPB approval.
|
NBFC
|
Part (i) of the following proposal does not lie
before FIPB and part (ii) has been rejected:
|
S. No.
|
Item No
|
Name of the applicant
|
Gist of the proposal
|
Sector
|
|
1
|
3
|
M/s MPC Rhine River
Limited
|
(i) Sell
and transfer its shareholding in AKME Rhine River Projects Private Limited
to a third party buyer, whether resident or non- resident, whether directly
or indirectly, and/or
(ii) Transfer
the construction development project being undertaken by AKME Rhine River
Projects Private Limited to a third party buyer, whether resident or non-
resident without any further requirement of Government approval upon
identification of the third party buyer.
|
Construction
|
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