The International Monetary Fund (IMF) said yesterday that it has sold 200 tonnes of gold to the Reserve Bank of India (RBI) to raise $6.7 billion as part of the global lender's strategy to boost its lending resources.

The transaction was carried out in a phased manner during the period from 19 October to 30 October with each daily sale done on the basis of that day's prevailing market prices. The total sale proceeds amount to $6.7 billion or SDR 4.2 billion, IMF's international reserve asset.

IMF managing director Dominique Strauss-Kahn said in a statement, ''I strongly welcome this transaction with the Reserve Bank of India.''

''This transaction is an important step toward achieving the objectives of the IMF's limited gold sales program, which are to help put the Fund's finances on a sound long-term footing and enable us to step up much-needed concessional lending to the poorest countries,'' Strauss-Kahn added.

Earlier in September, the executive board of the Washington-based lender had approved gold sales of up to 403.3 tonnes, about one-eighth of its holdings, to increase the Fund's resources to boost lending to low-income countries. (See: IMF to sell 403 tonnes of gold to boost lending resources)

The gold sales are expected to help finance a new income model for the IMF, making the 186-member lender less dependent on its lending revenue to cover expenses.

It is believed that RBI paid on an average $1,045 on an ounce of gold. Spot gold prices have gained around 45 per cent over the past one year hitting $1063 an ounce yesterday in London, helped by the weakness of the dollar.

IMF said that in accordance with the guiding principle of avoiding disruption of the gold market, the IMF's board adopted modalities for the gold sales consistent with guidelines it had earlier established.

In particular, the Fund is standing ready for an initial period to sell gold directly to central banks and other official holders that may be interested in such sales. Thereafter, on-market sales of any amounts remaining from the 403.3 tons would be conducted in a phased manner over time, following the approach adopted successfully by central banks participating in the Central Bank Gold Agreement.

IMF indicated that it may sell the remaining 203.3 tonnes of gold reserved for sale in the market, if no other central banks are interested to buy the asset.

According to World Gold Council (WGC) September data, IMF held the world's third-largest gold reserves of 3217 tonnes, after the US and Germany. India was on the 14th position with around 358 tonnes of gold holdings.