Why in News

The GoI, in consultation with the RBI, has decided to issue Sovereign Gold Bonds in six tranches from May 2021 to September 2021.

About Sovereign Gold Bond (SGB) Scheme:

• SGB scheme was launched in November 2015 with aiming to reduce the demand for physical gold and to shift a part of the domestic savings (used for the purchase of gold) into financial savings.
• The Gold Bonds are issued as GoI Stock under the Government Securities (GS) Act, 2006.
• These are issued by the Reserve Bank on behalf of the GoI.
• These Bonds can be sold through:
  • Commercial banks,
  • Stock Holding Corporation of India Limited (SHCIL),
  • designated post offices
  • Recognised stock exchanges viz., NSE and BSE, either directly or through agents.

Key Features:

• Issue Price: The Gold bond prices are linked to the price of gold of 999 purity (24 carats) as published by India Bullion and Jewellers Association), Mumbai.
• Investment Limit: These can be purchased in the multiples of one unit, up to certain limit for different investors.
• Minimum permissible investment: 1 gram of gold.
• Term: These gold bonds come with a maturity period of eight years.
  • It also has an option to exit the investment after first five years.
• Interest Rate: A fixed rate of 5% per annum is applicable on the scheme, which is payable semi-annually.
• The interest on these Gold Bonds are taxable as per the provision of Income Tax Act, 1961.
• These Bonds can be used as collateral for loans.
• The capital gains tax arising with the redemption of SGB to an individual has been exempted.
• Sovereign gold bonds are also listed on exchange but the trading volumes are not high, thus it is difficult to exit before maturity.

Why in News?

The Home Ministry’s recent order which required professional OCIs, such as journalists, engineers and researchers, to notify the Ministry about their activities in India has left them in the lurch.

About OCI:

• Overseas Citizenship of India (OCI) Scheme was started in 2005 by making amendments to Citizenship Act, 1955.
• In 2015, the Government of India merged PIO (Person Of Indian Origin) card with OCI card.

Exceptions:Eligibility:

• Person applying for OCI card must hold a valid Passport of another country.
• Individuals who do not have citizenship of any other country are ineligible to apply for OCI status.
• Individuals whose parents or grandparents hold/held citizenship of Pakistan and Bangladesh are ineligible to apply for OCI status.

Benefits for OCI cardholders:

• Lifelong Visa to visit India multiple times.
• No need to register with Foreigners Regional Registration Officer (FRRO) or Foreigners Registration Officer (FRO) for any duration of stay.
• Except for acquisition of agricultural and plantation properties, they have similar facilities which are extended to NRIs in economic, financial and educational fields.
• Treated at par with NRIs regarding – entry fees for national monuments, practice of professions like nurses,doctors, dentists, advocates, architects, etc.

Restrictions for OCI Card Holders:

• Do not have right to vote.
• Do not have right to any public service/government jobs.
• Cannot hold offices of – Prime Minister, President, Vice -President, Judge of Supreme Court and High Court, MP or MLA or MLC.
• Cannot own agricultural property.