Washington, Feb 18 (IANS) After a record sale of 200 tonnes of gold to the Reserve Bank of India, the International Monetary Fund (IMF) is now planning to put another 191.3 tonnes on the gold market to raise funds for low-income countries.

In all, the IMF has sold 212 tonnes of gold to central banks since its executive board approved gold sales totalling 403.3 tonnes in September 2009. The proceeds from these sales amount to almost $7.2 billion, or just over SDR (Special Drawing Rights) 4.5 billion.

Having already sold over half that amount to several central banks, the IMF is now looking to sell the remaining 191.3 tonnes of gold, phasing the sales so as to avoid market disruption, the IMF announced Thursday.

The IMF will continue to hold a substantial portion of its assets in gold. The sale of the full 403.3 tonnes would reduce the IMF's gold holdings by about one-eighth.

'The top priority in conducting the gold sales is to avoid disruption to the gold market,' said Andrew Tweedie, director of the IMF's finance department.

'Prior to any sales on the gold market, sales were first made exclusively to interested central banks, thus shifting gold within the official sector. Now the IMF will begin sales of the remaining gold on the market. This will be done in a phased way.'

Gold sales are part of the IMF's new income model aiming to diversify its income sources and better align them with the variety of functions performed by the Fund.

The sales would also help IMF mobilise $17 billion through 2014 for lending to low-income countries, mostly in Africa, that have been hard hit by the global crisis.

A financing package, which includes resources linked to these gold sales, has been agreed upon and will generate the additional new subsidy resources of SDR 1.5 billion needed to help cover the cost of further low-interest lending by the Fund.

The 200-tonne sale to the Reserve Bank of India is considered by some market commentators to be the single largest gold transaction in recent decades, generating proceeds equivalent to $6.7 billion or SDR 4.2 billion.

Sales of gold to the Bank of Mauritius and the Central Bank of Sri Lanka generated proceeds equivalent to $72 million (SDR 45 million) and $375 million (SDR 234 million), respectively.

(Arun Kumar can be contacted at arun.kumar@ians.in)