Chidambaram unveils measures to lure people from gold

New Delhi: Finance Minister P. Chidambaram Thursday announced measures to encourage people to make productive investments in financial markets and housing, instead of just putting their money in gold. "The household sector must be incentivised to save in financial instruments rather than buy gold," Chidambaram said while presenting the national budget for 2013-14.

The finance minister announced liberalisation of the Rajiv Gandhi Equity Savings Scheme (RGESS), with a view to make it more attractive to the common people. First time investors will now be allowed to invest in mutual funds as well as listed shares. This investment can be done not in one year alone, but in three successive years. The income limit is raised from Rs 10 lakh to Rs 12 lakh.

To protect savings and investments form inflation, Chidambaram announced the issue of inflation-indexed funds. "In consultation with RBI, I propose to introduce instruments that will protect savings from inflation, especially the savings of the poor and middle classes," the finance minister said.