Premature redemption under Sovereign Gold Bond (SGB) Scheme - Redemption Price for premature redemption of SGB 2019-20 Series V due on October 15, 2026
Distilled Policy Brief
- The premature redemption price for the Sovereign Gold Bond (SGB) 2019-20 Series V, due on October 15, 2026, is fixed at ₹14,725/- per unit based on the simple average of closing gold prices.
- The redemption price is calculated using the simple average of the closing price of 999 purity gold from the previous three business days, as published by the India Bullion and Jewellers Association Ltd (IBJA).
🎯 Prelims High-Yield Examination Points
Sovereign Gold Bonds (SGBs) permit premature redemption after the fifth year from the date of issue on interest payment dates, with prices based on the IBJA closing price of 999 purity gold of the previous three business days.
⚖️ Mains Analytical & Syllabus Linkages
Evaluate the role of Sovereign Gold Bonds as an alternative to physical gold in managing India's current account deficit and financialization of household savings.
🎯 UPSC Prelims Practice Drill
With reference to the premature redemption under the Sovereign Gold Bond (SGB) Scheme, consider the following statements: 1. Premature redemption of the gold bonds may be permitted after the fifth year from the date of issue on the date on which interest is payable. 2. The redemption price is determined based on the simple average of the closing price of gold of 999 purity of the previous three business days, as published by the India Bullion and Jewellers Association Ltd (IBJA). Which of the statements given above is/are correct?
- [A] 1 only
- [B] 2 only
- [C] Both 1 and 2
- [D] Neither 1 nor 2
▶ Reveal Official Answer & Analytical Explanation
Both statements are correct according to the Sovereign Gold Bond Scheme guidelines. Premature redemption is permitted after the fifth year from the date of issue on an interest payment date, and the redemption price is calculated using the simple average of the closing price of 999 purity gold of the previous three business days as published by the IBJA.
🏛️ Historical Twin PYQ Anchor (2021)
Consider the following statements regarding the "National Clean Air Programme (NCAP)": 1. It is implemented by the Ministry of Environment, Forest and Climate Change. 2. Central Pollution Control Board acts as the sole regulatory executive body.