Congress steps up attack on Modi over RBI funds

Ahead of the RBI Board meeting next week, the Congress on Monday stepped up attack on the Modi government for trying to seek a transfer of over Rs three lakh crore from the central bank.

The Congress said that the move was a “sinister attempt to pounce” on the RBI treasury and claimed that it was a sequel to the demonetisation exercise of 2016.

Congress spokesman Abhishek Manu Singhvi accused the Modi government of pushing bureaucrats to the fore to respond to questions raised by the Opposition.

“This falsehood is being peddled by none other than the finance ministry through the likes of senior officers who are being coerced to put forth a misleading argument and even fictitious and false data in order to construct this narrative,” Singhvi told reporters in New Delhi.

The RBI has a massive Rs 9.59-lakh-crore reserves and reports had it that the government wanted the central bank to part with a third of that fund.

This transfer of funds along with easing of norms for weak banks and raising liquidity had led to friction between the central bank and the government.

The issues are expected to figure in the RBI Board meeting on November 19 triggering speculation that RBI Governor Urjit Patel may quit if the government forced the central bank to accede to its demands.

Singhvi claimed that these funds of the RBI will be used by the government to recapitalize public sector banks, failing PSU’s, thereby benefiting "crony friends" in an election season.

AICC general secretary Ashok Gehlot said that the Modi government was putting undue pressure over the RBI and trying to disrupt its functioning.

"The NDA is destroying institution after institution to hide its bad governance," Gehlot said.