RBI dividend
The government has received a bumper dividend of about Rs 7 lakh crore from the Reserve Bank of India (RBI). Getting this large amount will help the government to reduce fiscal deficit and speed up the economy and create the fourth major economy in the world. This has been said in the report of SBI economists. Finance Minister Nirmala Sitharaman had estimated a dividend of Rs 2.56 lakh crore from Reserve Bank of India (RBI) and public sector financial institutions in her budget of 2025-26. After the dividend transfer of RBI, this figure will now be much higher than the budget estimate.
Will open way for additional expenditure of 70,000 crores
According to the latest report of SBI Research’s Ecorap, we estimate that this will reduce the fiscal deficit 0.2 percent from the budget to 4.2 percent of the GDP (GDP). Alternatively it will open the way for an additional expenditure of about Rs 70,000 crore, while there will be no change in other things. RBI has announced a dividend of Rs 2.69 lakh crore for FY 2024-25. This is an increase of 27.4 percent as compared to a dividend transfer of Rs 2.11 lakh crore in the previous financial year 2023-24. This has occurred after a change in the range of casual risk buffer, which the central bank can maintain up to six percent (plus or minus 1.5 percent). The buffer was previously maintained between 5.5 percent and 6.5 percent. The report states that this surplus payment is due to strong gross dollar sales, high foreign exchange profit and continuous increase in interest income.
Foreign exchange reserves were sold
It is noteworthy that in January, RBI was the top seller of foreign exchange reserves as compared to other central banks in Asia. In September 2024, the foreign exchange reserves reached the peak of US $ 704 billion. The report said that after this the central bank sold ‘dollars’ to stabilize the currency. The surplus status for the RBI was fixed by its LAF (facility of liquidity adjustment) operations and interest income from holding domestic and foreign securities. The report said that the sustainable cash situation in the current financial year is expected to remain in the surplus. It will get support from the purchase of open market operations (OMOs), dividend transfer of RBI and balance of $ 25 to 30 billion in 2025-26 (BOP) surplus.
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