The Sovereign Gold Scheme (SGS) aims to provide an alternate avenue for individuals to invest in gold while also mobilizing idle gold held by households and institutions. Critically analyse.

Topic: Government policies and interventions for development in various sectors and issues arising out of their design and implementation.

Topic: Government policies and interventions for development in various sectors and issues arising out of their design and implementation.

2. The Sovereign Gold Scheme (SGS) aims to provide an alternate avenue for individuals to invest in gold while also mobilizing idle gold held by households and institutions. Critically analyse. (250 words)

Difficulty level: Moderate

Reference: Live Mint , Insights on India

Why the question: India’s sovereign gold bond scheme has been of benefit to retail investors as well as the whole economy. Key Demand of the question: To write in detail about the Sovereign Gold Bond Scheme, its successes and limitations. Directive word: Critically analyze – When asked to analyse, you must examine methodically the structure or nature of the topic by separating it into component parts and present them in a summary. When ‘critically’ is suffixed or prefixed to a directive, one needs to look at the good and bad of the topic and give a balanced judgment on the topic. Structure of the answer: Introduction: In brief, write a few introductory lines about the Sovereign Gold Bond Scheme. Body: In the body, first write about the salient features of the scheme. Next, write about its successes – promoting financial inclusion, providing interest earnings, ensuring safety, and offering tax benefits etc. Next, write about its limitations – lack liquidity and may be subject to interest rate and market risks. Conclusion: Conclude by writing a way forward.

Why the question:

India’s sovereign gold bond scheme has been of benefit to retail investors as well as the whole economy.

Key Demand of the question:

To write in detail about the Sovereign Gold Bond Scheme, its successes and limitations.

Directive word:

Critically analyze – When asked to analyse, you must examine methodically the structure or nature of the topic by separating it into component parts and present them in a summary. When ‘critically’ is suffixed or prefixed to a directive, one needs to look at the good and bad of the topic and give a balanced judgment on the topic.

Structure of the answer:

Introduction:

In brief, write a few introductory lines about the Sovereign Gold Bond Scheme.

In the body, first write about the salient features of the scheme.

Next, write about its successes – promoting financial inclusion, providing interest earnings, ensuring safety, and offering tax benefits etc.

Next, write about its limitations – lack liquidity and may be subject to interest rate and market risks.

Conclusion:

Conclude by writing a way forward.