Union Budget 2019: Modi govt accounts for 'excess reserves' from RBI

Transfers from the Reserve Bank of India (RBI), which have been a point of conflict between the government and the central bank, has been budgeted at about Rs 90,000 crore in the form of dividend for 2019-20, Finance Secretary Subhash Chandra Garg told reporters on Friday. But the receipts budget appears to have made assumptions regarding additional transfer from the central bank, even though the committee to determine the issue of “excess reserves”, headed by former governor Bimal Jalan, is yet to submit its report.  

In the receipts budget, the allocation towards “dividend or surplus of RBI, nationalised banks and financial institutions” has increased by Rs 23,130 crore to Rs 1.06 trillion in 2019-20, compared to the interim Budget. 

In the time of interim Budget in February, the government had budgeted Rs 69,000 crore as dividend from the RBI. This means the government is expecting around Rs 20,000 crore as additional transfers from the RBI.  

The Jalan committee has seen several delays in submitting report, following dissent by Garg, who is a part of the panel.