It appears that the Reserve Bank of India has broken Indian law by holding 265.49 tonnes of India’s gold reserves at the Bank of England. This is approximately 46% of India’s total reserves of 557.75 tonnes.
So apparently all that publicity India received several years ago when it added 200 tonnes to its gold reserves was actually the cartel adding to their gold reserves at the Bank of England, with a few ‘India’ post it notes for reference.
If you don’t hold it, you don’t own it!
According to Raghunath Kelkar, the Reserve Bank of India is bound to keep excess gold in its reserves, not deposit outside the country; despite summons, RBI rep fails to appear in court.
Atechnocrat-turned-public interest litigant Raghunath Shankar Kelkar has challenged the Reserve Bank of India’s (RBI) move to deposit 265.49 tonnes of gold out of its total stock of 557.75 tonnes abroad by filing a public interest litigation (PIL) in the Bombay High Court and demanded that the precious metal be brought back into the country, according to the provisions of the law.
Kelkar (56), who used to manufacture computers, has filed the petition as he found the move by the apex bank in contradiction to the section 33(5) of Reserve Bank of India (RBI) Act, 1934, which stipulates that 85 per cent of its gold reserves should be kept in India.
Kelkar read the 17th half yearly report of RBI on management of foreign exchange reserves, in which the apex bank has said, “The Reserve Bank held 557.75 tonnes of gold, forming about 9.2 per cent of the total foreign exchange reserves. Of these 265.49 tonnes are held abroad in deposits or safe custody with the Bank of England and the Bank for International Settlements.”
He said that the RBI move was in violation of the legal provision as it had put 46 per cent of its gold reserves out of the country. The reason issued for the action is that of safe custody. “Does the RBI mean that gold is unsafe in India? Does the RBI think that Indian security forces are incapable of guarding the gold treasure of the country?” he asked.