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[roni]

A new gold era awaits Indian investors
Allan Seccombe
Posted: Fri, 27 Jan 2006

[miningmx.com] -- INDIA will launch at least two gold-backed exchange traded funds (ETFs) in coming months, joining the meteoric rise in interest in the investment tool seen in five other countries over the past year.

Paul Walker, chief executive of London-based precious metal consultancy GFMS, said the amount of gold locked into ETFs has risen by 200 tonnes to 420 tonnes in the year to end-December 2005 in the United States, UK, Canada, Australia and South Africa.

On 24 January, the Securities and Exchange Board of India (SEBI) amended its mutual fund regulations to allow such funds to offer gold-backed ETFs. Each ETF counter or share represents one hundredth of an ounce of gold.

“At least two mutual funds have put in applications and they are waiting for regulatory approval,” said GFMS metal analyst Sanjiv Arole, who is based in Mumbai.

“They are on track and we should have these two in the next couple of months at least. It should be fairly soon,” he told Miningmx. “There’ll be quite a few others in the pipeline.”

It is difficult to tell what exactly the impact the ETFs would be on gold demand from India, he said, adding some traders were concerned there could be an impact on physical gold demand.
We view this as positive for investment demand for gold in India
A note from JP Morgan said the launch of ETFs in India is bullish news for gold.

more at http://www.miningmx.com/gold_silver/862284.htm