Mumbai's Siddhivinayak to become first temple to participate in PM Modi's gold scheme

KOLKATA: Mumbai's Siddhivinayak temple is set to become the first temple in India to participate in the government's Gold Monetisation Scheme (GMS). The temple committee, which met on Monday, has given a go ahead to deposit 44 kg of gold jewellery under the scheme.

Five banks -ICICI Bank, State Bank of India, Canara Bank, Corporation Bank and Indian Overseas Bank -have approached the temple committee, seeking the deposit.

"We will deposit gold jewellery of 12 carats to 24 carats under GMS," Sanjiv Patil, chief executive of the Siddhivinayak Ganapati Temple Trust, told ET. "A committee will be formed tomorrow (Tuesday) which will be entrusted with the duty of melting the jewellery at the India government mint in Mumbai to convert them into .994 pure gold, finalise the bank where the gold will be deposited and also to enter into a tripartite agreement with the designated bank (and the mint)."

The committee will shortly make a decision whether to deposit gold under GMS for a short, medium or a long term, he said. "The entire process will be over by April 15, by w​hich we will definitely deposit the gold jewellery under GMS."



The move will offer a tremendous boost to the Modi government's scheme that seeks to unlock household and temple gold estimated to be around 20,000 tonnes.

Industry executives cite tax concerns as one of the reasons for households and temples to keep their gold away from the scheme. This has prompted the finance ministry to think about tweaking the scheme. It has been indicated by the ministry that any changes to GMS would be applied retrospectively from the date the scheme started. The government has also proposed exemption from capital gains tax for depositors.

The scheme was fine tuned in January, allowing premature redemption and commission to bankers.Depositors are now allowed to go directly to a refiner, instead of going through collection and purity testing centres.

The Prime Minister had launched the gold scheme last year to incentivise households and temples to invest idle gold and to curb physical demand for gold, which forms the second highest constituent of India's import bill after crude oil. However, GMS has not gathered much momentum, with it attracting investment of just 3 tonnes of gold so far.