A committee set up by the RBI to look into its capital structure and how much of excess reserves it can hold or transfer to the government, is set to give its report on June 24 and may recommend that a third of RBI’s Rs 9.6 lakh crore of surplus capital be shifted to government coffers.
“It is heavily tilted in favour of the government. The panel will submit the report to the central bank on June 24, much ahead of the Union Budget,” a top source told DH.
The panel led by former RBI governor Bimal Jalan has almost thrashed out its differences and is meeting for the last time on Monday next after which it is expected to hand over its report to the central bank, the source said.
“It will help the government meet its Budget target easily,” the source said, adding that funds should flow from the RBI to the government throughout the year.
The RBI has already been transferring a bulk of its income to the government every year. It has transferred Rs 3.8 lakh crore between 2009-10 and 2018-19. But all that has come in the form of dividend payout. From now on, the government wants to dip into its capital reserves.
Sources in the government said that bolstered by the indication that the RBI could transfer a major chunk, the government is planning to increase the size of its Union Budget this year to over Rs 28 lakh crore from over Rs 27 lakh crore in the interim Budget.
The government also has certain poll promises to fulfil which requires more allocation in the July 5 Union Budget to be presented by Finance Minister Nirmala Sitharaman.
The new government has increased the size of PM-Kissan scheme by including all farmers. While the revised scheme envisages to cover two crore more farmers, it has a cost implication of over Rs 87,000 crore. The interim Budget had made provision only for Rs 75,000 crore under the original PM-Kissan scheme.
Besides, the BJP manifesto talks of an expenditure of Rs 100 lakh crore on the infrastructure sector in the next five years. That implies about Rs 20 lakh crore in a year. A major chunk will come from off-Budget expenditures but some amount will have to be allocated in the Budget, an official said.
