The Indian government has reduced its Sovereign Gold Bonds (SGBs) borrowing target to ₹18,500 crore in the July budget, down from ₹29,638 crore projected earlier.
Factors contributing to this reduction include a lack of new SGB issuances and the high cost of borrowing through gold bonds, which are influenced by rising gold prices and associated interest payments, which have nearly doubled over the past two years. The total value of gold liabilities held by the government through these bonds has surged to ₹85,000 crore