MMTC to auction 12 tonnes of gold from GMS in next 10 days

Government-owned MMTC, the country’s largest international trading company, will hold the first auction under the Gold Monetisation Scheme (GMS) of the central government in the next 10 days. The Government of India has mobilised about 21 tonnes of gold under the scheme. Of this, 12 tonnes is aimed to be sold through auction in the next three to six months, said a senior official of MMTC.

“We have completed the documentation with the department of expenditure to initiate the process. The notification for the auction is expected in a day or two and the auction will be held in the next seven to 10 days,” he added.

Under GMS, gold deposits are accepted from households, temples and trusts, with tenures of 1–3 years (short term), 5–7 years (medium term) and 12–15 years (long term).

While short-term deposits are converted into gold coin by MMTC, the long-term ones are marked for auction. The official said the majority of the gold under the scheme had come from temples and trusts. The response of households has been poor.

In his 2015–16 Budget speech, Finance Minister Arun Jaitley had said stocks of gold in India were estimated to be over 20,000 tonnes and most of this was neither traded or monetised. GMS aimed to put part of this ‘idle’ gold into circulation. And, in the process, achieve import substitution to that extent.

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