WMA Limits for Government of India for April 2014 - September 2014 would be Rs. 35,000 crore-RBI

It has been decided, in consultation with the Government of India, that the limits for Ways and Means Advances (WMA) for the first half of the financial year 2014-15 (April 2014-Sep 2014) would be Rs. 35,000 crore.

The Reserve Bank of India (RBI) may trigger fresh floatation of market loans when the Government of India utilises 75 per cent of the WMA limit.

The RBI would retain the flexibility to revise the limits at any time, in consultation with the Government of India, taking into consideration the prevailing circumstances.

The interest rate on WMA/overdraft will be:

a.WMA: Repo Rate

b.Overdraft: Two per cent above the Repo Rate

The minimum balance required to be maintained by the Government of India with the RBI will not be less than Rs.100 crore on Fridays, on the date of closure of Government of India's financial year and on June 30, i.e., closure of the annual accounts of the RBI and not less than Rs.10 crore on other days.

As per the provisions of the agreement dated March 26, 1997 between the Government of India and the Reserve Bank of India, overdrafts beyond ten consecutive working days will not be allowed.

The WMA limits for the second half of the financial year 2014-15 would be fixed in September 2014.

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