RBI is likely to pay 57000 crores as dividend to the Government

The Reserve Bank of India is likely to pay the government Rs 57,000 crore in dividends in the fiscal year 2016-17.

Flash points

• The amount paid is slightly lesser than the previous fiscal year but much higher than the previous years
• Last year, the government received Rs.73,905 crores as dividends from various state owned banks and the RBI
• This fiscal year it has estimated to receive Rs.69,897 crores
• However the split up of money from banks is not given and it expects 55000-60000 crores from RBI
• In the current fiscal, RBI has transferred Rs 65,896 crore to the government, almost its entire income
• The government does not expect much from the public sector banks owing to the growing NPA’s of the banks
• The Finance minister also proposed to infuse a capital of 25000 crores for improving the Capital of banks
• Under Section 47 of the RBI Act, 1934 the central bank is mandated to pay balance profits to the government

Key points

• RBI usually pays a part of the profit to the government and rest of it is given to Contingency and consolidated fund
• From 2013, RBI is giving the entire profit to the government after meeting its expenditure

Points to note

• RBI headquarters- Mumbai
• RBI governor –Raghuram Rajan