Discontinuing RBI bond a 'cruel blow', citizens must demand its restoration, says Chidambaram

Senior Congress leader P Chidambaram on Thursday hit out at the government for discontinuing the RBI Bonds scheme, saying it is another "cruel blow" to the citizens. The government discontinued the 7.75 percent Savings (Taxable) Bonds scheme, 2018, by issuing a notification that said that they shall cease for subscription with effect from the close of banking business on May 28.

"Government has dealt another blow to the citizens who save, especially senior citizens. It has discontinued the 7.75 percent RBI Bonds," Chidambaram said in a tweet.

He further urged people to demand from the government that the RBI Bond be restored immediately.

"After lowering the interest rates in PPF and small savings instruments, the abolition of the RBI Bond is another cruel blow," he posted.

Chidambaram said the government did this once before in January 2018.

"I protested vehemently. Next day they re-introduced the bond but reduced the interest rate from 8 per cent to 7.75 percent," he added.

He said effectively, after tax, the bond will yield only 4.4 percent.

"That is now taken away. Why? I deplore this action," he said.