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  5. RBI’s secret mission brings 102 tonnes of gold from UK ahead of Dhanteras

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RBI’s secret mission brings 102 tonnes of gold from UK ahead of Dhanteras

Abha Raverkar
By Abha Raverkar

2 min read | Updated on October 30, 2024, 17:20 IST

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SUMMARY

The Reserve Bank has transferred 102 tonnes of gold from the vaults of the Bank of England to secure locations in the country, the apex body revealed on Dhanteras on Tuesday, October 29. This comes at the back of a similar repatriation of 100 tonnes of gold in May.

The share of gold in the total foreign exchange reserves increased from 8.15% at the end of March 2024 to about 9.32% by the end of September 2024

The share of gold in the total foreign exchange reserves increased from 8.15% at the end of March 2024 to about 9.32% by the end of September 2024

As customers flocked to jewelry shops for Dhanteras, the Reserve Bank of India (RBI) on Tuesday disclosed that it has shipped back 102 tonnes of gold from the UK. The RBI said it has transferred the yellow metal from the Bank of England (BoE) to secure locations within the nation.
This move comes after the central bank, in May, transferred 100 tonnes of gold from Britain with plans for a similar shipment, reported The Times of India.
Like the previous transfer, the RBI undertook a secret mission involving a special aircraft and detailed security arrangements. The shipment was exempt from taxes, according to The Times of India.
Also read: RBI’s foreign gold reserves hit 6-year low, domestic reserves touch 53%

Rising geopolitical tensions

The movement of gold –one of India’s largest repatriations since the 1991 balance of payments crisis– comes amid rising geopolitical tensions. In 1991, the country had to pledge a significant portion of its gold reserves to BOE and the Bank for International Settlements (BIS), leading to gold leaving domestic vaults.

India has been repatriating gold over the years. During the 2023-24 fiscal year alone, the RBI moved 100 tonnes of gold back from the UK, reportedly storing it in vaults in Mumbai and Nagpur.

The RBI disclosed that, as of September end, 324 tonnes of gold were held in the safe custody of the Bank of England and the BIS, while 20 tonnes were maintained as gold deposits.

In value terms, the share of gold in the total foreign exchange reserves increased from 8.15% at the end of March 2024 to about 9.32% by the end of September 2024, driven by an increase in tonnage and surge in prices.

In 2009, India purchased 200 tonnes of gold from the International Monetary Fund (IMF) and has since continued to buy gold from the secondary market as part of its foreign exchange diversification efforts.

Also read: Gold demand in India to hit four-year low in 2024 on sharp rally in prices, says report

In late May, reports indicated that a call was taken to reduce the holding abroad which is part of the standard review procedures.

With inputs from PTI

About The Author

Abha Raverkar
Abha Raverkar is a post-graduate in economics from Christ University, Bengaluru. She has a strong interest in the markets and loves to unravel the nitty-gritties of the latest happenings in the world of markets, business, and economy.

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