The precious metal would be deposited with SBI which will pay interest. Interestingly, the interest will be paid in the form of gold, and not as cash.
Tirumala Tirupati Devasthanams (TTD), the custodian of the world's richest Hindu temple, has signed a pact with State Bank of India (SBI) for deposit of huge quantity of the surplus yellow metal lying in its treasury. The TTD has agreed, in the first phase, to deposit a whopping 1000 kg of gold with SBI, which is said to be the single largest ‘gold deal', both in terms of value and volume, in the history of the TTD, though it has deposited 1750 kg of gold so far in various banks.
The scheme, which is expected to be a win-win situation for both the stakeholders, is also unique in the sense that a bank is coming to the doorsteps of Tirumala to receive the gold deposits and pay interest in the form of gold.
SBI Chairman O.P. Bhat will be arriving here this week to formally receive the ‘opulent' deposit from the temple management.
While the TTD used to pay Rs.80 lakh in the past as charges towards transportation, insurance and melting (at the mint), the same will now be taken care of by the bank, thus saving a lot for the temple management. Similarly, against the paltry 0.75 p.c. previously, the TTD will now be getting 1.6 p.c. cumulative rate of interest for the five-year deposit.
Interestingly, the interest will be paid in the form of gold, and not as cash.
Though the RBI officials insist that interest shall not be paid in gold, the TTD, as a ‘privileged customer', is expected to walk away with more gold!
Showing posts with label Gold. Show all posts
Showing posts with label Gold. Show all posts
Monday, May 17, 2010
Friday, February 26, 2010
Gold, silver prices set to soar
Get ready to pay more for gold and silver as the union budget has propsed a 50% hike in custom duty on precious metals. The budget
speech has proposed a hike in custom duty of Rs 300 per 10 gram on gold from the current Rs 200. It has also proposed to hike the customs duty on silver from the current Rs 1000 to Rs 1500 per kg.
"Increase in custom duty will be definitely passed on to customers and so they have to be ready to pay more for the precious metals. However, reduction in raw material tax will push up refinery production, leading to greater circulation of used gold and decline in gold imports," said Prithviraj Kothari, Director, Mumbai-based bullion company Riddhi Sidhi Bullions.
Though the prices are likely to go up, it is unlikelly to crimp demand as consumers have witnessed peak prices in the recent quarters. Gold prices zoomed to as high Rs 18,700 per 10 gm during the November-December quarter. Its now hovering aoround in the range of Rs 16,500-16700 per 10 gm.
"Import prices on gold and silver will go up. However, this will not affect the demand, since people have seen much higher level for precious metals," said Praveen Singh, senior bullion analyst, Sharekhan. "Jewellery stocks such as Geetanjali Gems and Rajesh Exports are likely to suffer due to this proposal."
speech has proposed a hike in custom duty of Rs 300 per 10 gram on gold from the current Rs 200. It has also proposed to hike the customs duty on silver from the current Rs 1000 to Rs 1500 per kg.
"Increase in custom duty will be definitely passed on to customers and so they have to be ready to pay more for the precious metals. However, reduction in raw material tax will push up refinery production, leading to greater circulation of used gold and decline in gold imports," said Prithviraj Kothari, Director, Mumbai-based bullion company Riddhi Sidhi Bullions.
Though the prices are likely to go up, it is unlikelly to crimp demand as consumers have witnessed peak prices in the recent quarters. Gold prices zoomed to as high Rs 18,700 per 10 gm during the November-December quarter. Its now hovering aoround in the range of Rs 16,500-16700 per 10 gm.
"Import prices on gold and silver will go up. However, this will not affect the demand, since people have seen much higher level for precious metals," said Praveen Singh, senior bullion analyst, Sharekhan. "Jewellery stocks such as Geetanjali Gems and Rajesh Exports are likely to suffer due to this proposal."
