Scrapping '8% bonds' a deplorable act by Central Govt, says Chidambaram

New Delhi: Congress leader and former Union Finance Minister P. Chidambaram on Monday said that the Narendra Modi governments decision to scrap the '8 per cent taxable bond' was a "severe blow" to the middle class and a "deplorable act".

"Modi government scraps 8% taxable bonds dealing a severe blow to the middle class. How will the risk-averse average citizen save?" Chidambaram said in a tweet."Government owes a duty to provide its citizens one safe and risk free instrument for savings. Taking the only instrument away is a deplorable act," he added.

The government on Monday announced that the '8% GOI Savings (Taxable) Bonds, 2003' will cease for subscription with effect from the close of banking business on Tuesday, January 2.Introduced in 2003, the '8% bonds' are government of India bonds with a fixed rate of interest of 8 per cent per annum paid half yearly. They are available in physical form only and are not listed or tradable on stock exchanges. The interest received from these bonds is taxable.