Finance Secretary Subhash Chandra Garg on Friday said the government expects Rs 90,000 crore as dividend from the RBI in the current fiscal.
This is a 32 percent jump from the previous fiscal when the central bank paid Rs 68,000 crore to the government including Rs 28,000 crore as interim dividend. This was the highest receipt from the Reserve Bank in a single financial year, exceeding the Rs 65,896 crore received in 2015-16 and Rs 40,659 crore in 2017-18.
"The Reserve Bank dividend will come after the annual meeting. The government has estimated about Rs 90,000 crore as dividend from the RBI," he said.
The Reserve Bank follows July-June financial year and usually distributes the dividend in August after annual accounts are finalized. The Union Budget 2019-20 has pegged dividend or surplus of the RBI, nationalized banks and financial institutions at Rs 1.06 lakh crore up from Rs 74,140.37 crore realized in the previous fiscal. Meanwhile, the RBI has set up a panel under former Governor Bimal Jalan to look into the size of capital reserves that the central bank should hold.
The six-member panel, under former RBI Governor Bimal Jalan, was appointed on December 26, 2018, to review the economic capital framework (ECF) for the Reserve Bank after the Finance Ministry wanted it to follow the global best practices and transfer more surplus to the government. The other key members of the panel include Rakesh Mohan, former deputy governor of RBI as the vice-chairman, finance secretary Subhash Chandra Garg, RBI deputy governor N S Vishwanathan, and two RBI central board members -- Bharat Doshi and Sudhir Mankad.
The government and the RBI under its previous governor Urjit Patel had been at loggerheads over the Rs 9.6 lakh crore surplus capital with the central bank.
The Finance Ministry was of the view that the buffer of 28 percent of gross assets maintained by the central bank is well above the global norm of around 14 percent. Following this, the RBI board in its meeting on November 19, 2018, decided to constitute a panel to examine Economic Capital Framework.
In the past, the issue of the ideal size of the RBI reserves was examined by three committees -- V Subrahmanyam in 1997, Usha Thorat in 2004 and YH Malegam in 2013.