RBI to transfer Rs 57K crore surplus to govt

Mumbai, August 14

The Reserve Bank of India (RBI) Board on Friday approved the transfer of Rs 57,128 crore as surplus to the Centre for the 2019-20 accounting year.

In a statement, the bank said the decision was taken at the 584th meeting of the Central Board of the Reserve Bank of India chaired by Governor Shaktikanta Das.

Economic review

The RBI Board reviewed the current economic situation, continued global as well as domestic challenges, and monetary, regulatory and other measures taken by the RBI, under the chairmanship of Governor Shaktikanta Das, to mitigate the economic impact of the Covid-19 pandemic.

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Covid lockdown impact

The Covid pandemic-triggered lockdown affected government’s revenue collections as fiscal deficit hit a record Rs6.62 lakh crore in between April and June.

The board reviewed the current economic situation, continued global as well as domestic challenges, and monetary, regulatory and other measures taken by the RBI to mitigate the economic impact of the Covid-19 pandemic.

“The board also approved the transfer of Rs 57,128 crore as surplus to the Centre for the 2019-20 accounting year, while deciding to maintain the Contingency Risk Buffer at 5.5 per cent,” the statement said.

Further, the Central Board discussed the proposal of setting up an innovation hub.

It also discussed various areas of operations of the bank during the last year, and approved the annual report and accounts of the Reserve Bank for 2019-20.

According to the RBI Act of 1934, section “Allocation of surplus funds” mandates for any profits made by the Reserve Bank of India from its operations to be sent to the Central government.

The Covid pandemic-triggered lockdown affected government’s revenue collections as fiscal deficit hit a record Rs 6.62 lakh crore in the April-June period. Fiscal deficit is an indication of the borrowings needed by a government. It occurs when revenue collections fall short of expenditure. — Agencies