Shri Pranab Mukherjee on the occasion of launch of imprint India on the second day of Visitor’s Conference

Address by the president of India, Shri Pranab Mukherjee on the occasion of launch of imprint India on the second day of Visitor’s Conference

Good Morning!

1. I extend a warm welcome to you all who are here to attend the first-ever Visitor’s Conference. In the past, I have had the occasion to meet many of you during the different conferences organized at the Rashtrapati Bhavan and convocations at your institutes. This is, however, the first time that as Visitor, I am meeting you all together. As mentioned by my Secretary, the outcomes of the previous conferences have given us the confidence that the institutes of higher learning, if they come together, can make a difference in a short span of time to higher education sector in our country. With this shared belief, we are here today.

2. I thank Hon’ble Prime Minister, Shri Narendra Modi, for his gracious presence. His enchanting speech and inspiring words, I have no doubt, will set the tone for the deliberations during the Conference. I take this opportunity to also place on record my appreciation for Shrimati Smriti Zubin Irani, Minister for Human Resource Development. By steering various initiatives with purpose and energy, she has taken forward the education sector.

3. I compliment the Prime Minister and the HRD Minister for the just-launched programme of IMPRINT, a Pan IIT and IISc initiative. The ten themes of this programme identifying the immediate requirements of the society will lay down the research roadmap for institutes of national importance. I call upon the academic leaders of institutes in social sector and humanities’ domain to formulate a similar joint initiative for conducting research on themes of relevance to public policy-making.

4. Distinguished Guests, Ladies and Gentlemen: It is true that the past ten years have seen a vast expansion of the higher education infrastructure. However, low Gross Enrolment Ratio (GER) at 21 percent in India as against the world average of 27 percent remains a cause for concern. A New Education Policy is being formulated. I am told that a process of consultation has commenced on 13 themes for school education and 20 themes for higher education. The new policy must alter the dynamics of the education sector and help us achieve the GER target of 30 percent by 2020, a goal we cannot afford to miss.

5. At the altar of expansion, quality should not be sacrificed. Greater number of institutions translates into greater number of seats, enhancing access and equity in higher education. However, it has generated a lively debate on reach versus excellence, quality versus affordability, and accountability versus autonomy. A calm assessment will make it clear to all stakeholders that we need both reach and excellence, quality and affordability, and autonomy with accountability.

6. Increasing access in higher education through digital inclusion is a way forward. We should, without delay, think of taking modified MOOCs to the secondary education level. To skill India, we must design MOOCs that is interactive and offer vocational aspirants an opportunity to learn. This could revolutionize delivery of skills knowledge.

7. Distinguished participants: An institute of higher learning finds its real value by excelling in education, research and innovation. This calls for faculty development and augmentation of teaching resources across the board. This calls for inspired teachers, keen-to-learn students, and good physical and research infrastructure. This also calls for a reliable and extensive ICT network. Some encouraging developments in the recent past, that I can recall are:

(i) Intensification of exchange of faculty through formal arrangements with foreign institutions: In addition to the MOUs that must have been signed by various institutions of higher learning, over 80 MOUs with 50 overseas institutions have been signed during my visits abroad in the last two years. This demonstrates the interest and potential for collaboration with international institutions.

(ii) Removal of bottlenecks and simplification of procedures for filling up faculty positions;

(iii) Engagement of adjunct faculty and hiring of foreign experts - the Global Initiative for Academic Networks (GIAN) is a welcome step aimed at tapping the global pool of talented scientists and entrepreneurs. By encouraging their engagement with Indian institutes, we can augment our country’s academic resources.

8. Distinguished participants: It is good to see research moving centre-stage in our institutes of higher learning. This will in near future help us meet the need for good faculty. A recent example is IIT Delhi, which has awarded 221 PhDs this year, the highest in a year so far. It has resolved to increase this number to 400 in the next few years. Such initiatives will not only lead to higher research quotient for the nation but also improve rankings of the institutions.

9. Earlier not a single Indian institution came within the top 200 institutions in international rankings. It seems that my persistent exhortation has paid off. Many of you have responded to my call. I am grateful for that. Our institutions are now taking the ranking process more seriously, in a proactive and systematic manner. In the QS World University Rankings 2015-16, Indian institutions have broken into the top 200 for the first time. I compliment Indian Institute of Science, Bangalore, which is ranked 147^th and Indian Institute of Technology, Delhi, ranked 179^th, for this achievement. If we provide enough funds to top 10-20 institutions for next 4-5 years, we will soon see them storm into the top 100.

10. The National Institutional Ranking Framework launched by the Ministry of HRD with an India-centric approach is a step in the right direction. This initiative should enable Indian institutes of higher learning to realize their potential and emerge as world-class institutions.

11. Ladies and Gentlemen: Knowledge is indivisible. We must follow a multi-disciplinary approach that allows students to learn and seek knowledge holistically. Our institutions must impart education to the students that help expand their intellect, form their character, instill in them a spirit of service and love for the motherland. It must equip them to face the struggle of real life. It must deepen the students’ linkage with society. It is also necessary to develop in our students a scientific temper, which allows the flight of imagination beyond the realm of grades and classrooms. Promotion of research at the under-graduate level would assist such an objective.

12. Distinguished participants: The link between progress and innovation is direct. History is witness to many nations low on natural resources emerging as advanced economies only on the strength of rapid technological development. India today stands within a striking distance of realizing the dreams of the founding fathers of our nation. Indian youth are second to none in entrepreneurship. India serves as the fastest growing start-up base worldwide and stands third with 4,200 start-ups, next only to US and UK. The government has initiated the ‘Start-up India, Stand-up India’ campaign to incentivize entrepreneurial ventures. Heads of institutes of higher learning must work towards creating an innovation and research network that will produce entrepreneurs and nurture innovations. The setting up of Innovation Clubs in over 60 Central institutions in the last two years is a good beginning for a platform where novel ideas can be nurtured and innovators mentored to develop new products.

13. In response to the decision taken in the conference of vice chancellors of central universities in 2014, industry interface cells have been set up in many institutions. These cells are now lending vigour to activities like joint research, faculty exchange, and setting up of chairs and endowments. These cells can also interact closely with innovation incubators for monetizing ideas and research. The 45 MOUs signed with the industry yesterday takes to next level the partnership between industry and academia.

14. Ladies and Gentlemen: Academic institutions are an important stakeholder for the socio-economic development of the nation. I had earlier asked central universities and NITs to adopt at least five villages and transform them into model villages. I now extend my call to all the 114 central institutions. After identifying problems in the adopted villages, they must pool all academic and technical resources at their disposal to provide solutions that will enhance the quality of life of our countrymen.

15. As we start the deliberations in this Conference, I assure you of an exciting journey ahead in the world of education. Be ready for roadblocks, criticisms, failures and successes. But continue to work with a fresh and positive mind. Do take heart from what Mahatma Gandhi had said, and I quote: "First they ignore you, then they laugh at you, then they fight you, then you win” (unquote). And win you shall.

Thank you.

launch of ‘IMPRINT India’

The President of India, Shri Pranab Mukherjee launched ‘IMPRINT India’, a Pan-IIT and IISc joint initiative to develop a roadmap for research to solve major engineering and technology challenges in ten technology domains relevant to India today (November 5, 2015) at Rashtrapati Bhavan on the second day of the Visitor’s Conference.

The idea of launching ‘IMPRINT India’ originated during the conference of Chairmen, Board of Governors and Directors of Indian Institutes of Technology convened by the President at Rashtrapati Bhavan on August 22, 2014. It is based on the Prime Minister’s suggestion that research done by institutions of national importance must be linked with immediate requirements of the society at large.

The objectives of this initiative is to (1) identify areas of immediate relevance to society requiring innovation, (2) direct scientific research into identified areas, (3) ensure higher funding support for research into these areas and (4) measure outcomes of the research effort with reference to impact on the standard of living in the rural/urban areas.

IMPRINT India will focus on ten themes with each to be coordinated by one IIT/IISc, namely

(a) Health Care - IIT Kharagpur,

(b) Computer Science and ICT – IIT Kharagpur,

(c) Advance Materials – IIT Kanpur,

(d) Water Resources and River systems – IIT Kanpur,

(e) Sustainable Urban Design – IIT Roorkee,

(f) Defence – IIT Madras,

(g) Manufacturing – IIT Madras,

(h) Nano-technology Hardware- IIT Bombay,

(i) Environmental Science and Climate Change – IISc, Bangalore and

(j) Energy Security – IIT Bombay.

Speaking on the occasion, the President said the outcomes of the previous conferences have given us the confidence that the institutes of higher learning, if they come together, can make a difference in a short span of time to higher education sector in our country. He called upon the academic leaders of institutes in social sector and humanities’ domain to formulate a similar joint initiative like ‘IMPRINT India’ for conducting research on themes of relevance to public policy-making.

The President saidit is necessary to develop in our students a scientific temper, which allows the flight of imagination beyond the realm of grades and classrooms. Promotion of research at the under-graduate level would assist such an objective. The link between progress and innovation is direct. History is witness to many nations low on resources emerging as advanced economies only on the strength of rapid technological development. India today stands within a striking distance of realizing the dreams of the founding fathers of our nation. Indian youth are second to none in entrepreneurship. India serves as the fastest growing start-up base worldwide and stands third with 4,200 start-ups, next only to US and UK. The government has initiated the ‘Start-up India, Stand-up India’ campaign to incentivize entrepreneurial ventures. Heads of institutes of higher learning must work towards creating an innovation and research network that will produce entrepreneurs and nurture innovations. The setting up of Innovation Clubs in over 60 Central institutions in the last two years is a good beginning for a platform where novel ideas can be nurtured and innovators mentored to develop new products.

The President said in response to the decision taken in the conference of vice chancellors of central universities in 2014, industry interface cells have been set up in many institutions. These cells are now lending vigour to activities like joint research, faculty exchange, and setting up of chairs and endowments. These cells can also interact closely with innovation incubators for monetizing ideas and research. The 45 MoUs signed with the industry yesterday takes to next level the partnership between industry and academia.

The President saidacademic institutions are an important stakeholder for the socio-economic development of the nation. He had earlier asked central universities and NITs to adopt at least five villages and transform them into model villages. He said he now extends his call to all the 114 central institutions. After identifying problems in the adopted villages, they must pool all academic and technical resources at their disposal to provide solutions that will enhance the quality of life of our countrymen. Some encouraging developments in the recent past are intensified exchange of faculty through formal arrangements with foreign institutions; removal of bottlenecks and simplification of procedures for filling up faculty positions and engagement of adjunct faculty and hiring of foreign experts through the Global Initiative for Academic Networks.

The President said the National Institutional Ranking Framework launched by the Ministry of HRD with an India-centric approach is a step in the right direction. This initiative should enable Indian institutes of higher learning to realize their potential and emerge as world-class institutions.

The President said the new education policy must alter the dynamics of the education sector and help us achieve the GER target of 30 percent by 2020, a goal we cannot afford to miss.

Prime Minister Narendra Modi released the IMPRINT India brochure and hand over the first copy to the President of India on the occasion. The Prime Minister and Union Minister of Human Resource Development, Smt. Smriti Zubin Irani also addressed the gathering.

MSP for Rabi Crops of 2015-16 season

MSP for Rabi Crops of 2015-16 season

The Cabinet Committee on Economic Affairs, chaired by the Prime Minister Shri Narendra Modi, has given its approval for the Minimum Support Prices (MSPs) for Rabi Crops of 2015-16 Season to be Marketed in 2016-17. The decision is based on recommendations of Commission for Agricultural Costs and Prices (CACP) for the Price Policy for Rabi Crops for the Marketing Season 2016-17.  CACP, which is an expert body,  takes into account the cost of production, overall demand-supply, domestic and international prices, inter-crop price parity, terms of trade between agricultural and non-agricultural sectors, the likely effect of the Price Policy on the rest of economy, besides ensuring rational utilization of production resources like land and water, while recommending MSPs.

The CACP being the expert body, its recommendations are generally accepted as such.  However, in view of the gap in the demand and  domestic supply  of pulses, the Cabinet has decided to give a bonus of Rs.75/- per quintal for rabi pulses over and above the recommendations of the CACP.  This is expected to give a strong price signal to farmers to increase acreage and invest for increase in productivity of pulses.

 The Minimum Support Prices (MSPs) for all Rabi Crops of 2015-16 season to be marketed in 2016-17 have been increased and are given in table below: 

                                                                                          

Commodity	MSP for 2014-15 season	MSP for 2015-16 season	Increase in MSP over 2014-15		Bonus  *
	(Rs per  quintal)	(Rs per  quintal)	Absolute	%	(Rs per  quintal)
Wheat	1450	1525	75	5.2	-
Barley	1150	1225	75	6.5	-
Gram	3175	3425	250	7.9	75
Masur (Lentil)	3075	3325	250	8.1	75
Rapeseed/ Mustard	3100	3350	250	8.0	-
Safflower	3050	3300	250	8.2	-

    Note * Bonus on Rabi pulses is payable over and above the MSP                

The prices would be effective from the Rabi marketing season 2016-17. The higher MSPs would increase investment and production through assured remunerative prices to farmers.

The Cabinet also directed that in order to strengthen the procurement mechanism for pulses and oilseeds, Food Corporation of India (FCI) will be the Central Nodal Agency for procurement of pulses and oilseeds.  To supplement the efforts of FCI, the National Agricultural Cooperative Marketing Federation of India Limited (NAFED), National Cooperative Consumers’ Federation (NCCF), Central Warehousing Corporation (CWC) and Small Farmers Agri – Business Consortium (SFAC) may also undertake procurement of oilseeds and pulses as per their capacity.

 Besides increase in Minimum Support Prices (MSP) of Rabi crops, Government has taken several other farmer friendly initiatives over the last one year.  These, inter-alia, include the following :

·         In the Kharif the Government of India had declared a bonus of Rs 200 per quintal over and above the MSPs of Kharif pulses for 2015-16 season.

·         A Scheme to issue Soil Health Card to every farmer has been introduced.  Soil health management in the country is being promoted through setting up of soil & fertilizer testing laboratories and implementation of organic farming.

                 

·         Government has also framed guidelines under Paramparagat Krishi Vikas Yojna (PKVY) to promote organic farming and develop potential market for organic products.

·         The Pradhan Mantri Krishi Sinchai Yojana, has been launched with the objective of creating sources of assured irrigation.

·         A dedicated Kisan Channel has been started by the Doordarshan to address various issues concerning farmers.

·         Government has also created portal on crops insurance in order to keep farmers better informed.

·         An initiative is being taken to set up a National Agriculture Market (NAM).  This would enable farmers to overcome the impediments in marketing of agricultural produce and get better price discovery.  A common e-market platform is being created and would be provided free of cost to the States/UTs.

·         Government has taken steps to introduce electronic trading which will facilitate single license for trading in the whole States/country as well as single point levy of market fee.

·         Government is also encouraging formation of Farmer Producer Organisations.

·         To stabilize prices of pulses and onions, Government has imported pulses and onions under the Price Stabilisation Fund.

Regulate, don’t eliminate

A sudden and arbitrary ban on commercial surrogacy will hurt all the stakeholders in this multi-billion rupee industry,particularly children who are at the core of the issue.

The government of India’s proposed ban on commercial surrogacy is a rather ill-thought-out move that could have a disastrous effect on the flourishing surrogacy industry in India.

It is disastrous, not just because it will spell an end to the multi-crore industry, but because we are talking about the human lives which are at stake. Embryonic human lives, being gestated in the safe wombs of alternate mothers, could be in jeopardy if commercial surrogacy is suddenly and abruptly made illegal. What will then happen to the women who hired out their wombs? What if they are left holding babies they never wanted because the rules changed? What will happen to the hopes of the thousands of commissioning parents, who have paid lakhs of rupees or dollars on fertility packages? What if they cannot take their babies out of the country and India does not recognise the children?

Widespread impact

Gita Aravamudan

The consequences of such official action have been visible in other countries. Thailand, a popular destination for fertility tourism, suddenly clamped a ban on commercial surrogacy earlier this year, after a couple of disasters exposed its dark underbelly. The result was chaos. A number of surrogates in various stages of pregnancy were left in limbo. Intending parents did not know how to collect their babies. Consequently, the surrogacy industry got pushed underground.

And then there was a flourishing cross- border surrogate smuggling nexus between India and Nepal, which was exposed in the aftermath of the earthquake when Indian women, who had crossed the border carrying babies for gay Israeli couples, got stuck in Nepal with their unborn babies. Nepal has subsequently banned all commercial surrogacy.

Given that an arbitrary ban on surrogacy can be disastrous, can phasing out help? And should commercial surrogacy be phased out?

India has had time to think about these issues, as commercial surrogacy has been around for a couple of decades now. The first surrogate baby in India was born in 1994. The industry has since evolved, and today India offers some of the best fertility “packages’ in the world. Intending parents with a valid fertility visa can come to India and get their IVF procedures done, hire healthy surrogates, return home, and monitor the entire pregnancy from afar. They can also get proper exit visas to take the children home after they are born. Earlier, the agreements between intending parents and surrogates were oral and the latter were often underpaid and ill-treated. Today, there are proper contracts to ensure that neither party is cheated. In many of the bigger and better organised fertility clinics, the surrogates are housed in special homes, given proper diet, medical checkups and maintenance allowances.

The baby, when it is born, has the intending parents’ names on its birth certificate and the surrogate has no more claim or obligation to the child. The contract also ensures that the surrogate gets Rs. 4 to 8 lakh depending on the number of babies she is carrying. But of course, not everything is hunky dory. There are many cases of exploited or ill-used surrogates, cheated parents, unqualified doctors and unscrupulous agents, largely because India has been unable to pass a regulatory law. The Artificial Reproductive Technology (ART) Bill, first proposed in 2008, has gone through three avatars, but is yet to be tabled in Parliament. This proposed Bill covers several areas of concern, but needs updating and tweaking before it can be tabled. Even as the Bill is pending, it seems counterproductive to impose a ban on surrogacy without understanding the issues at stake.

Huge and unregulated

When I started writing my book Baby Makers: The Story of Indian Surrogacy in 2012, I had a very simple agenda. As a feminist and a writer, I wondered how a woman would feel if she had to rent another woman’s womb to carry her baby and how the woman who carried that baby would feel about it. Not an easy task, I found, as neither the surrogates nor the intending parents open up easily because they fear a social backlash. I also found that there were no proper statistics about the number of IVF clinics in India nor the number of surrogates. No one even knew what the actual turnover was. A United Nations-backed study said the industry had a turnover of $400 million, but many in the field said it was much higher. At present, the surrogacy business functions under the regulatory guidelines issued by the Indian Council of Medical Research. However, many of the fly-by-night clinics did not even bother about these guidelines.

People come to India for fertility tourism because it is cheaper or because it is unavailable in their own countries. Egg donation, which is legal in India, is banned in some countries. But in many East European countries it is big business. In India, an egg donor can get Rs. 25,000 every time she donates her eggs. This procedure too has to be carefully monitored and spaced. This is often not done because the more seedy clinics do not care about the health of the donor. Sometimes, the women themselves volunteer to donate more often because they are not aware of the dangers of ovarian hyperstimulation, and there are any number of unscrupulous “fertility experts” who are willing to oblige both commissioning parents and needy donors.

Today the minimal regulation on the fertility industry in India is obviously woefully inadequate. But any law which is put in place has to take into consideration the needs and aspirations of the various people involved in this business. Primarily there are the babies born through surrogacy whose citizenship and right to be protected by their biological parents is of primary importance.

At the bottom of the pecking order are the surrogates, who are in it because it is a means of livelihood. From their perspective, there is nothing morally or ethically wrong because the babies are conceived through “injection” (embryo implant) and not through sexual intercourse. They do sometimes get attached to the babies in their womb, but to them the money is more important and they are quick to move on after the birth of the child.

Some of the surrogates I spoke to proudly showed me their houses built from money they had earned through renting out their wombs. Many preferred foreign commissioning parents, as they paid better and gave better tips.

Some of the surrogates were poor, some middle class, some illiterate, some educated. They belonged to all communities… their need for money is what linked them. And as one woman pointed out, it was not wrong to want money for a better life and by renting out her womb, she was not hurting anyone as even her family supported her.

For the intending parents, surrogacy is a boon which gives them the child they never thought they could have. For this they are willing to pay any amount and go to any lengths to protect and nurture the surrogate carrying the baby for them. For the fertility specialists, this is the job they have been trained to do.

The problem lies with the bogus embryologists and doctors, the agents and touts who lure and cheat surrogates, as well as intending parents. They are the exploiters. Banning commercial surrogacy in India at this advanced stage will help no one. It will only create chaos and push the business underground. Banning is easy. Framing a proper law needs careful thought, good technical inputs and above all, political will.

Modi is world's 9th most powerful person: Forbes

Prime Minister Narendra Modi has been ranked as the world’s ninth most powerful person by Forbes magazine in a 2015 list which is topped by Russian President Vladimir Putin.

Mr. Modi was placed 14th in the 2014 Forbes list of world’s powerful people.

Forbes while releasing the list today at the same time said governing 1.2 billion people in India requires more than “shaking hands” and that Mr. Modi must pass his party BJP’s reform agenda and keep “fractious opposition” under control.

German Chancellor Angela Merkel is at the second spot followed by US President Barack Obama (third) and Pope Francis (fourth) and Chinese President Xi Jinping (fifth).

Apart from Mr. Modi who is at the ninth position, others in the top ten are Microsoft Founder Bill Gates at the sixth place, US Federal Reserve Chairperson Janet Yellen (7), UK Prime Minister David Cameron (8) and Google’s Larry Page(10)

About Mr. Modi, the magazine said that India’s “populist” Prime Minister presided over 7.4 per cent GDP growth in his first year in office, and “raised his profile” as a global leader during official visits with Barack Obama and Xi Jinping.

“A barnstorming tour of Silicon Valley reinforced his nation’s massive importance in tech. But governing 1.2 billion people requires more than shaking hands: Now Modi must pass his party’s reform agenda and keep fractious opposition under control,” it said.

To compile the list of world’s most powerful people, the magazine said it considered hundreds of candidates from various walks of life all around the globe, and measured their power along four dimensions. They are whether the candidate has power over lots of people, financial resources controlled by each person, whether the candidate is powerful in multiple spheres and whether the candidates actively used their power.

Ayurveda Prakriti - The Three Doshas, have been Correlated with Genomic Structures in a Research Study

Ayurveda Prakriti - The Three Doshas, have been Correlated with Genomic Structures in a Research Study

A genome-wide study indicated certain correlation between Ayurvedic prakriti classifications with genomic diversity.  A study on the subject has been done by the Centre for Cellular & Molecular Biology (CCMB), Hyderabad a premier research organization of Council for Scientific and Industrial Research with the collaboration of other national research institutes.

A research team at the CCMB under the leadership of Dr. Thangaraj, has taken up the mega program. Well-trained Ayurvedic physicians screened about 3400 people and the same sets of people were also screened by software called AyuSoft developed by C-DAC, Bangalore. 

Ayurvedic physicians believe that there are three doshas or biological energies / humors found in the human body.  Ancient Indians believed that everything that we see is made up of five elements – Space, Air, Fire, Water and Earth.  Vata is related to elements of space and air; pittha is related to elements of fire and water and kapha is related to elements of water and earth.  Each individual would have different levels of these three doshas, hence the diversity.  However, each person can be classified, belonging to one or the other type, if one of the doshas predominates.

People whose Prakriti was in concurrence between the assessment by the Ayurvedic physician and by AyuSoft were recruited for the study.  Their blood samples were collected by respective participating labs. Isolation of DNA and genomic studies were carried out at CCMB using Affymetrix 6.0 SNP chip. This chip brings out single nucleotide difference in the genome among the tested samples.  When the data is plotted, interestingly they fell into three groups, establishing the molecular basis for ancient classification. 

Whether such phenotypic classification has any molecular basis has been a matter of debate for some time.  A few groups attempted to answer this question and found some correlation when they looked at one or two specific genes.  However, the association of genomic variations with prakriti classification was lacking.

This is the first genome-wide study to establish such correlation between Ayurvedic prakriti classifications with genomic diversity.  Analysis of these single nucleotide polymorphisms (SNPs) revealed that about 52 genes might be responsible for specifying the individual's doshas or prakritis.  Dr. Thangaraj and his group has taken this study further and attempted to see if the samples collected randomly, without any information on their prakriti, would also fall into three groups after the analysis based on the 52 SNPs, which appear to be important.

Director-CCMB Dr. Ch. Mohan Rao said that this study would help to identify the prakriti of a person based on her/his genome. “This is a major breakthrough linking our ancient wisdom with modern science”. He also said that this work will inspire many more such studies. These studies should eventually lead to establishing Ayurveda on sound footing along with modern medicine.

These studies were recently published in an Open Access Journal, Science Reports, of Nature group of publications. It can be accessed at: http://www.nature.com/articles/srep15786

Gold Monetisation Scheme (GMS), Gold Sovereign Bond Scheme and the Gold Coin and Bullion Scheme

PM to launch Gold Related Schemes on 5th November, 2015; First ever National Gold Coin minted in India with National Emblem of Ashok Chakra engraved to be released among others on the occasion

The Prime Minister Shri Narendra Modi will launch the three Gold related Schemes i.e. Gold Monetisation Scheme (GMS), Gold Sovereign Bond Scheme and the Gold Coin and Bullion Scheme on Thursday, 5^thNovember, 2015 in the national capital.

The salient features of each of the aforesaid scheme are as follows:

Gold Monetisation Scheme (GMS), 2015

The GMS will replace the existing Gold Deposit Scheme, 1999. However, the deposits outstanding under the Gold Deposit Scheme will be allowed to run till maturity unless the depositors prematurely withdraw them.

 Resident Indians (Individuals, HUF, Trusts including Mutual Funds/Exchange Traded Funds registered under SEBI (Mutual Fund) Regulations and Companies) can make deposits under the scheme. The minimum deposit at any one time shall be raw gold (bars, coins, jewellery excluding stones and other metals) equivalent to 30 grams of gold. There is no maximum limit for deposit under the scheme.

 The gold will be accepted at the Collection and Purity Testing Centres (CPTC) certified by Bureau of Indian Standards (BIS). The deposit certificates will be issued by banks in equivalent  of 995 fineness of gold. The designated banks will accept gold deposits under the Short Term (1-3 years) Bank Deposit (STBD) as well as Medium (5-7 years) and Long (12-15 years) Term Government Deposit Schemes (MLTGD). While the former will be accepted by banks on their own account, the latter will be on behalf of the Government of India. There will be provision for premature withdrawal subject to a minimum lock-in period and penalty to be determined by individual banks for the STBD. The interest rate  in the STBD will be determined by the banks. The interest rate in the medium term bonds has been fixed at 2.25% and for the long term bonds is 2.5% for the bonds issued in 2015-16.

Interest on deposits under the scheme will start accruing from the date of conversion of gold deposited into tradable gold bars after refinement or 30 days after the receipt of gold at the CPTC or the bank’s designated branch, as the case may be and whichever is earlier. During the period from the date of receipt of gold by the CPTC or the designated branch, as the case may be, to the date on which interest starts accruing in the deposit, the gold accepted by the CPTC or the designated branch of the bank shall be treated as an item in safe custody held by the designated bank.

The Short Term Bank Deposits will attract applicable Cash Reserve Ratio (CRR) and Statutory Liquidity Ratio (SLR). However, the stock of gold held by the banks will count towards the general SLR requirement. The opening of Gold Deposit Accounts will be subject to the same rules with regard to customer identification (KYC) as are applicable to any other deposit account.

The designated banks may sell or lend the gold accepted under STBD to MMTC for minting India Gold Coins (IGC) and to jewellers, or sell it to other designated banks participating in GMS. The gold deposited under MLTGD will be auctioned by MMTC or any other agency authorised by the Central Government and the sale proceeds credited to the Central Government’s account with the Reserve Bank of India. The entities participating in the auction may include the Reserve Bank, MMTC, banks and any other entities notified by the Central Government. Banks may utilise the gold purchased in the auction for purposes indicated above. Designated banks should put in place a suitable risk management mechanism, including appropriate limits, to manage the risk arising from gold price movements in respect of their net exposure to gold. For this purpose, they have been allowed to access the international exchanges, London Bullion Market Association or make use of over-the-counter contracts to hedge exposures to bullion prices subject to the guidelines issued by the Reserve Bank.

Complaints against designated banks regarding any discrepancy in issuance of receipts and deposit certificates, redemption of deposits, payment of interest will be handled first by the bank’s grievance redress process and then by the Reserve Bank’s Banking Ombudsman.

It may be recalled that the Government of India announced the Gold Monetisation Scheme vide its Office Memorandum F.No.20/6/2015-FT dated September 15, 2015. The objective of the Scheme is to mobilise gold held by households and institutions of the country and facilitate its use for productive purposes, and in the long run, to reduce country’s reliance on the import of gold..

 The list of CPTCs and Refiners are certified by the Bureau of Indian Standards. Indian Banks Association has finalized the necessary documentation including the tripartite agreements between the designated banks, CPTCs and the Refiners under the Scheme. Banks have put in place the requisite systems and procedures to implement the scheme and will continue to improve them.

Sovereign Gold Bond Scheme

The Government of India has decided to issue Sovereign Gold Bonds. The Bonds will be issued in multiple tranches subject to the overall borrowing limits of GOI. Applications for the bond under the first tranche will be accepted from November 05, 2015 to November 20, 2015. The Bonds will be issued on November 26, 2015. The Bonds will be sold through banks and designated post offices as notified. It may be recalled that the Union Finance Minister had announced in Union Budget 2015-16 about developing a financial asset, Sovereign Gold Bond, as an alternative to purchasing metal gold.

Sovereign Gold Bond will be issued by Reserve Bank India on behalf of the Government of India. The Bonds will be restricted for sale to resident Indian entities including individuals, HUFs, trusts, Universities, charitable institutions. The Bonds will be denominated in multiples of gram(s) of gold with a basic unit of 1 gram. 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. Minimum permissible investment will be 2 units (i.e. 2 grams of gold).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. A mechanism will be put in place for internal verification of the self declarations.

In case of joint holding, the investment limit of 500 grams will be applied to the first applicant only. Each tranche will be kept open for a period to be notified. The issuance date will also be specified in the notification. 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).Payment for the Bonds will be through electronic funds transfer/cash payment/ cheque/ demand draft. The investors will be issued a Stock/Holding Certificate.

 The Bonds are eligible for conversion into demat form. 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. Bonds will be sold through banks and designated Post Offices, as notified, either directly or through agents. The investors will get interest at a  fixed rate of 2.75 per cent per annum payable semi-annually on the initial value of investment for the bonds issued in 2015-16.

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. 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. 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. Department of Revenue has agreed to ensure tax neutrality between the purchase of physical gold and investment in the gold bonds. This will require amendments in the existing provisions of the Income Tax act , which will be considered in the 2016-17 Budget. Bonds will be tradable on exchanges/NDS-OM from a date to be notified by RBI..The Bonds will be eligible for Statutory Liquidity Ratio (SLR). Commission for distribution shall be paid at the rate of 1% of the subscription amount.

Gold Coin/Bullion Scheme

The Indian gold coin & bullion is a part of the Gold Monetisation Programme. The coin will be the first  ever national gold coin minted in India and will have the National Emblem of Ashok Chakra engraved  on one side and Mahatma Gandhi on the other side . Initially the coins will be available in denominations of 5 and 10 grams. A 20 gram bullion will also be available. Initially, 15,000 coins of 5gm, 20,000 coins of 10 gm and 3,750 of  bullions of 20 gm  will be made available through MMTC outlets. The Indian Gold coin & bullion is unique in many aspects and will carry advanced anti-counterfeit features and tamper proof packaging.

The Indian Cold coin & bullion will be of 24 karat purity and 999 fineness. All coins & bullion will be hallmarked as per the BIS standards. These coins will be distributed initially through designated & recognised MMTC outlets and later through specified bank branches and post offices.