SEBI, RBI not on same page over surplus transfer

Tribune News Service

New Delhi, July 18

Two autonomous government institutions are taking different paths as regards parting with their surplus in order to trim the Central Government’s fiscal deficit.

In fact, anticipating higher outgoes from the Reserve Bank of India (RBI) and the Securities and Exchange Board of India (SEBI), Union Finance Minister Nirmala Sitharaman has already lowered the fiscal deficit in this Budget to 3.3% from 3.4% proposed in the Interim Budget.

In the aftermath of resignations by two Governors, the RBI has chosen a less conflict-prone approach by setting up a committee that is in favour of a phase-wise transfer, despite objections from the Centre’s nominee and Union Finance Secretary Subhash Chandra Garg in favour of a one-time transfer of surplus reserves.

The SEBI, in contrast, is resisting the Budget proposal to transfer 75 per cent of its surplus to the Central Exchequer. SEBI chief Ajay Tyagi wrote to the government last week, expressing difficulties in the regulator’s functioning if it were to transfer the mandated amount to the Centre. SEBI is also opposed to a provision in the Budget that makes government permission must for any capital expenditure.

The RBI and the SEBI will be major contributors if the government is to meet its ambitious plan of raising 37% extra from dividend and profits and 19% growth in its non-tax revenue. 

The SEBI is still in the upward curve of resisting the government plan to make it part with some of its reserves. 

Funds to govt

• The RBI has chosen a less conflict-prone approach by setting up a panel that is in favour of a phase-wise transfer of its surplus to the Central Exchequer
• The SEBI, in contrast, continues to resist the Budget proposals as regards transferring 75 per cent of its surplus and government permission for any capital expenditure