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

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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 RBIRBI
  • 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