RBI Board meeting today to finalise annual accounts, to take up Bimal Jalan committee's recommendation

The RBI follows a July-June financial year and the dividend is usually distributed in August after annual accounts are finalised

FP Staff August 26, 2019 07:55:53 IST
RBI Board meeting today to finalise annual accounts, to take up Bimal Jalan committee's recommendation
  • The committee had submitted its report to the RBI Governor on Friday

  • The RBI follows a July-June financial year and the dividend is usually distributed in August after annual accounts are finalised

  • For FY20, the government has pegged a Rs 9,000 crore dividend from the RBI.

The Bimal Jalan committee's recommendations on Economic Capital Framework (ECF) along with the dividend payment to the government may be taken up in the Reserve Bank of India (RBI) board meeting to be held today (Monday), sources said.

The RBI board meeting will finalise its annual accounts.

The committee had submitted its report to the RBI Governor on Friday. The report, which recommends transfer of surplus reserves to the government in a staggered manner over three-five years based on a predetermined formula, maybe put on the Reserve Bank of India (RBI) website later for public access, according to media reports.

The RBI follows a July-June financial year and the dividend is usually distributed in August after annual accounts are finalised. For FY20, the government has pegged a Rs 9,000 crore dividend from the RBI.

Sources had earlier told IANS that the RBI may start transferring the first tranche of the surplus this calendar, based on the Jalan panel report.

RBI Board meeting today to finalise annual accounts to take up Bimal Jalan committees recommendation

Representational image. Reuters.

With the economy facing a slowdown in key sectors, the government is looking at RBI dividends and surplus to step up public investment and tackle funding gaps.

But any decision on capital transfers based on the panel's proposals may not come on Monday as the board members may need more time to study the recommendations.

The board, however, most likely will announce the normal dividend to be paid to the government for FY19 based on the surplus, sources said.

The government has already received Rs 40,000 crore during FY19.

In February this year, the RBI had announced a Rs 28,000 crore interim dividend taking the total dividend transfer to the government to Rs 68,000 crore. The RBI Central Board will have to approve the Rs 28,000 crore interim dividend.

So far the extent of capital reserves to be transferred to the government based on the Jalan panel report has been a matter of speculation.

According to BofA Merrill Lynch, the ECF is expected to peg the excess capital of the RBI at Rs 1-Rs 3 lakh crore, where Rs 1 lakh crore is from contingency reserves and Rs 2 lakh crore from revaluation reserves.

"The RBI Act doesn't bar the RBI from transferring excess capital if any, to the fisc beyond the RBI's annual surplus," BofA Merrill Lynch said.

As per 2017-18 annual report of the RBI, the reserves stand at Rs 9.6 trillion.

Updated Date:

Find latest and upcoming tech gadgets online on Tech2 Gadgets. Get technology news, gadgets reviews & ratings. Popular gadgets including laptop, tablet and mobile specifications, features, prices, comparison.

also read

Economic fallout of COVID-19 to push at least 150-175 mn people into extreme poverty, says UN expert
India

Economic fallout of COVID-19 to push at least 150-175 mn people into extreme poverty, says UN expert

Special Rapporteur Olivier De Schutter said most of those who will fall into extreme poverty will be workers in the informal sector or in precarious employment conditions, especially women

Centre says COVID-19 vaccine distribution via 'special immunisation programme'; active cases remain under 7 lakh
India

Centre says COVID-19 vaccine distribution via 'special immunisation programme'; active cases remain under 7 lakh

The Union health ministry also said that the number of new cases reported in the country remained below 60,000 for the fifth consecutive day

'Common man's Diwali in your hands': SC sets 2 Nov deadline for Centre to implement interest waiver
Business

'Common man's Diwali in your hands': SC sets 2 Nov deadline for Centre to implement interest waiver

The court said the Central Government should implement 'as soon as possible' interest waiver on loans of up to Rs 2 crore under the RBI moratorium scheme in view of the COVID-19 pandemic