Govt asks RBI Rs 10,000 cr as interim dividend: Report

The Central Government has demanded Rs 10,000 crore as interim dividend from the Reserve Bank of India (RBI) for the financial year 2019-20 (FY20) to bridge the fiscal gap, according to a report by Business Standard.

The demand comes at a time when government finances have come under pressure due to moderation in revenue collection and a slew of measures taken to lift growth from over six-year-low of 4.5% in the second quarter of the current fiscal.

As per the government’s estimate, the country’s GDP growth is seen dipping to an 11-year low of 5% in the current fiscal as compared to 6.8% in 2018-19.

This is the third time when the government has demanded an interim dividend.

The central bank, however, is yet to take a final call on the government's demand. It may take a call on this at its central board meeting scheduled for February 15 in New Delhi.

According to the report, Finance Minister Nirmala Sitharaman is expected to address the RBI’s central board before that customary post-Budget meeting. Last year, the RBI paid an interim dividend of Rs 28,000 crore to the Union government, which was also announced in the central bank’s post-Budget board meeting in February.

Last year in August, Governor Shaktikanta Das-led RBI central board gave its nod for transferring to the government a sum of Rs 1,76,051 crore, comprising Rs 1,23,414 crore of surplus for the year 2018-19 and Rs 52,637 crore of excess provisions identified as per the revised Economic Capital Framework (ECF).

If the RBI board agrees to an interim dividend based on their six-month performance, it would provide some financial relief to the government.