New Delhi: The Reserve Bank of India (RBI) will pay a record Rs 2.1 lakh crore dividend to the government for the fiscal ended March 31, more than double of what was budgeted expectation, helping shore up revenue ahead of a new government taking office.
The RBI board, at its meeting on Wednesday, approved the transfer of surplus, the central bank said in a statement.
The Government had budgeted a receipt of Rs 1.02 lakh crore as dividends from the RBI, public sector banks and financial institutions in the interim budget for the fiscal year 2024-25 (April 2024 to March 2025) presented in February this year.
The dividend or surplus transfer by the RBI to the Centre was Rs 87,416 crore for the fiscal 2022-23. The previous high was Rs 1.76 lakh crore in FY 2018-19.
The decision on the dividend payout was taken at the 608th meeting of the Central Board of Directors of the Reserve Bank of India held under the chairmanship of Governor Shaktikanta Das.
"The Board...approved the transfer of Rs 2,10,874 crore as surplus to the Central Government for the accounting year 2023-24," the RBI said in a statement.
The Central Government aims to contain the fiscal deficit or gap between expenditure and revenue to Rs 17.34 lakh crore (5.1 percent of the GDP) during the current financial year.
The RBI board also reviewed the global and domestic economic scenario, including risks to the growth outlook.
The Board discussed the working of the Reserve Bank during 2023-24 and approved its Annual Report and Financial Statements for the last fiscal.
The RBI said that during accounting years 2018-19 to 2021-22, owing to the prevailing macroeconomic conditions and the onslaught of the Covid-19 pandemic, the Board had decided to maintain the Contingent Risk Buffer (CRB) at 5.50 percent of the Reserve Bank’s balance sheet size to support growth and overall economic activity.
"With the revival in economic growth in FY 2022-23, the CRB was increased to 6.00 percent. As the economy remains robust and resilient, the Board has decided to increase the CRB to 6.50 percent for FY 2023-24," the central bank added.
The transferable surplus for 2023-24, the RBI said, has been arrived at on the basis of the Economic Capital Framework (ECF) adopted by it in August 2019, as per recommendations of the Bimal Jalan-headed expert committee.
The committee had recommended that the risk provisioning under the CRB be maintained within a range of 6.5 to 5.5 percent of the RBI’s balance sheet.
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