INSUBCONTINENT EXCLUSIVE:
State Bank of India (SBI) group chief economic adviser Soumya Kanti Ghosh has said that the Reserve Bank of India's payout of Rs 1.76 lakh
crore "will hold the economy in good shape", and will help the government maintain its fiscal deficit goal with no additional borrowings
Comments from the top SBI official come a day after the RBI's Central Board approved a transfer of Rs 1.76 lakh crore to the government
from its surplus and reserves, as it accepted the recommendations made by an expert committee headed by former RBI Governor Bimal Jalan.The
RBI has made it clear the transfer has been done from its retained earnings unlike the earlier demand by the government to transfer funds
from its unrealised gains, he said, adding that it is a "very conscious decision", and "holds well" for the central bank.The transfer of
surplus and excess dividend is in line with the recommendations of the Bimal Jalan Committee, which was tasked to review the Economic
Capital Framework of the RBI
The record transfer by the RBI to the government includes a surplus of Rs
1.23 lakh crore for 2018-19.The RBI pays dividends to the government every year, based on the profits from its investments and printing of
It will release its balance sheet as part of its annual report later this week.With government revenues not looking encouraging and in
conjuncture with the RBI's accommodative stance, the transfer will help the government maintain its fiscal deficit target of 3.3 per cent
of GDP with no additional borrowings, Mr Ghosh added.The government in July this year revised its fiscal deficit target to 3.3 per cent from
3.4 per cent previously, surprising many economists who had expected a relaxation in the goal.Last week, Finance Minister Nirmala Sitharaman
announced a range of measures, including an immediate injection of Rs
70,000 crore into state-run banks, to shore up growth.India's GDP or gross domestic product grew 5.8 per cent in the quarter ended March
For the full financial year 2018-19, economic growth came in at 6.8 per cent, the lowest in nearly five years.The government is due to
release GDP data for the first quarter of financial year 2019-20."All in all it is a good move and in conjunction with the RBI's
accommodative monetary policy I think this will hold the economy in good shape when the growth has been slow," Mr Ghosh added.According to a
poll by news agency Reuters, the economic growth is expected to have slowed to a more than five-year low of 5.7 per cent in the June
quarter.Get Breaking news, live coverage, and Latest News from India and around the world on TheIndianSubcontinent.com
Catch all the Live TV action on TheIndianSubcontinent 24x7 and TheIndianSubcontinent India
Like us on Facebook or follow us on Twitter and Instagram for latest news and live news updates.