<h1>Sovereign Gold Bond Scheme: Reduce Physical Gold Demand, Invest Up to 500g Annually, Interest Linked to Gold Prices.</h1> The Sovereign Gold Bond Scheme aims to reduce the demand for physical gold by offering bonds linked to gold prices. Issued by the Reserve Bank of India on behalf of the government, these bonds target resident Indian entities, with a purchase cap of 500 grams per person annually. They offer a nominal interest rate linked to international gold borrowing rates, with maturity payouts in Rupee terms. Bonds can be used as loan collateral and traded on commodity exchanges, with tax treatment similar to physical gold. Marketing will involve post offices and brokers, and the scheme will fit within the fiscal deficit target for 2015-16.