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100 tonne gold from UK to India – Why RBI did so? ‘We felt part of…’ – Shaktikanta Das explains

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RBI 100 Tonne Gold From UK to India: Late last month it had emerged that the Reserve Bank of India (RBI) has moved quite a sizeable chunk of gold from the UK to India. Perhaps for the first time in over 2 decades, the Reserve Bank brought home a little over a whopping 100 tonnes of the yellow metal from Britain to its vaults here.

Now, Governor Shaktikanta Das has explained the rationale behind the decision to shift back the huge tranche of gold from Britain to India. According to him, this was done because the quantum of gold outside the country had gone up due to the central bank’s purchase.

“The quantum of gold held by RBI was static for a long time,” Das said on Friday while addressing a Q&A session after the monetary policy announcement.

100 Tonne Gold From UK to India

Part of the gold was decided to be held within the country as there was storage capacity available, Das stated adding that nothing more should be read into it. “In recent years, the data shows that the Reserve Bank is buying gold as a part of its reserves, and the quantum was going up. We have domestic (storage) capacity,” he said.

Therefore, it was decided to move part of the reserve outside India to be stored within the country, he said, adding, “That’s it. Nothing more should be read into it”.

Moreover, the gold transfer will also help the Reserve Bank to save on some of the storage cost, which is paid to Bank of England.

After the central bank’s big gold shift from the UK to India, the overall quantity stored here has risen to over 408 metric tonnes of gold. According to RBI’s annual report for the financial year released last month, over 308 metric tonnes of gold is held in India as backing for notes issued, while another 100.28 tonnes is held locally as an asset of the banking department.

source:ET

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