The draft of the gold bond scheme, prepared by the Reserve Bank of India, is gathering dust at the North Block awaiting a `go-ahead' from the government. "It may not see the light of the day if the Congress comes to power," said an industry source. The gold bond scheme was not part of the Finance Bill which got passed without any amendments on Thursday.

After the announcement on the gold bond scheme in the union budget, broad guidelines of the scheme were formulated by the Reserve Bank of India in consultation with nominated banks and was sent to the finance ministry for its stamp of approval which never came.

Officially, the RBI maintains that the scheme is on the cards and the guidelines are being framed. Some of the banks are also in the process of setting up their assaying facility. "However, the green signal fromthe Centre is unlikely to come. The new government may not like to float the bond scheme," sources said.

"If the gold bond scheme finally fails to see the light of the day, the government's ambitious plan to monetise idle gold will come a cropper," said one senior official of a nationalised bank. Sinha wanted to monetise at least 12,000 tonne of idle gold reserve lying in Indian households. Going by the current gold rate (10 gm of gold--Rs 4420), Rs 53,040 crore worth of long-term funds could have been generated which would have gone to finance infrastructure sector.

In his budget speech, the former finance minister had directed all the nominated banks -- allowed to import gold--to frame a `gold deposit scheme' to mobilise gold lying idle in the household sector and offer interest bearing certificates or bonds to investors which can be reclaimed on maturity.

The interest income will be exempted from income tax, value of assets will be free of wealth tax and the gains on trading of certificate will beexempted from capital gains tax, the budget speech had said.

Almost all the active gold trading banks have already submitted their gold bond schemes to the central bank for approval. These banks have also jointly taken steps to set up a subsidiary which will take charge of assaying and refining of gold.

According to industry sources, if the scheme does not come through, the bankers will be a disappointed lot as most of them have taken efforts to increase their gold business through the gold loan scheme.

The main objective behind floating a gold deposit scheme was to tap unaccounted and unauthorised gold locked in the household sector. However, no amnesty was provided. A gold bond scheme, launched in 1993 and redeemed in 1998, was able to mop up 41 tonne of gold lying in the household sector.