- The
Reserve Bank of India (RBI ) plans to transfer ₹ 99,122 crore as surplus to the Centre for nine months ended March 31, 2021. - The surplus is considerably higher than what the RBI has put forth in the last two years.
- According to the chief economist at ICRA, the funds will allow the
Indian government to absorb the losses that it is likely to face due to the second wave of COVID-19.
"The amount of surplus to be transferred by the RBI to the Government of India is considerably higher than the budgeted level," said Aditi Nayar, the chief economist at ICRA.
According to her, this will offer a buffer to absorb the losses in indirect tax revenues that are anticipated in May-June 2021, related to the impact of the now widespread state lockdowns on the level of consumption on discretionary items and contact-intensive services.
"Moreover, high commodity prices at a time when demand and pricing power are subdued, would dent the margins of corporates in many sectors, compressing the growth in direct tax collections," said Nayar.
The RBI, in its meeting, reviewed the current economic situation, global and domestic challenges and recent policy measures taken by the Reserve Bank to mitigate the adverse impact of the second wave of Covid-19 on the economy.
"The Board also approved the transfer of ₹ 99,122 crore as surplus to the Central Government for the accounting period of nine months ended March 31, 2021 (July 2020-March 2021), while deciding to maintain the Contingency Risk Buffer at 5.50 per cent," the apex institution said in a statement.
(With inputs from IANS)
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