Government Gets Rs. 99,122 cr Surplus from RBI - Need or Rashlessness ?
UTKARSH AGARWAL, JMI COVID-19 pandemic has put forward unprecedented challenges and naturally, fiscal deficit for the government. However, the void has been filled by a massive surplus given by RBI to the government i.e. Rs 99,122 cr as a surplus. However, now the contingency risk buffer is set at 5.50% only. We shall look into the issue in detail. What is surplus? Every year RBI transfers surplus from its revenue to the government in the form of dividend tax-free. In the financial year 2019-2020, a surplus of Rs 57,128 cr was transferred by RBI to the government. However, this year, with a slight change, the surplus amount is accounted only for 9 months due to shifting from the financial year to April-March from the earlier July-June. RBI earns its revenue from the following functions: It manages the borrowing of the central government and state governments(s). it regulates & supervises banks and NBFCs It manages the currency and payment system. It claims...