The world's richest Hindu temple is asking to be repaid in gold for longer-term deposits it makes under the Indian government's monetisation scheme in order to make the plan more attractive to the temples that are sitting on thousands of tonnes of the metal.
The Sri Venkateswara Swamy Temple, popularly known as the Tirupati, has requested repayment of their deposits of longer than three years under the Gold Monetisation Scheme in the metal rather than cash, D. Sambasiva Rao, the executive director of the temple operator Tirumala Tirupati Devasthanam (TTD) told Reuters on Wednesday.
TTD's participation in the gold scheme is crucial to its success since the temple in Andhra Pradesh holds 7 tonnes of the metal, equivalent to about $277 million at current prices. However, Tirupati and other temples around India are reluctant to part with the gold forever because of its religious and emotional significance.
"We wrote to the government to change certain conditions in the scheme and offer principal and interest in the form of gold for medium-term and long-term deposits," Rao said, referring to deposits for between five and 15 years.
"The changes will make the scheme attractive for all the temples in the country," he said.
India is the world's second-biggest consumer of gold after China and imports accounted for about a quarter of India's trade deficit in the year ending March 2015.
Prime Minister Narendra Modi last year launched the Gold Monetisation Scheme to mobilise gold stashed with individuals, institutions and rich temples for recycling and to reduce imports. The scheme has garnered about 3 tonnes of gold in four months out of a national hoard of over 20,000 tonnes.
Seeking divine blessings, devotees have offered billions of dollars worth of jewellery, bars and coins to temples over the centuries.
TTD last month deposited 1.3 tonnes of gold with state-run Punjab National Bank at a rate of 1.75 percent for three years, Rao said, as some of its deposits under previous monetisation schemes have matured.
The temple will deposit another 1.4 tonnes in a fortnight at 1.25 percent with Indian Overseas Bank as most of the gold is raw and the bank will spend to refine it, he added.
The 200-year-old Shree Siddhivinayak Ganapati Temple in Mumbai said it will deposit 44 kg of gold with a bank by the end of the month for recycling, choosing a short-term plan rather than a longer scheme that does not pay back in gold, said Narendra Murari Rane, chairman of the trust for the temple.
"We want returns in gold because if the prices of gold go higher than the monetary benefit that we will get, then devotees will blame us for depositing the gold at a cheaper rate," Rane said in Marathi.