After the earlier dividend payout to the federal government, amid hefty fall in revenue, there are again reports that say Narendra Modi govt may again push the RBI to dole out a package for them and spur growth which has been the slowest in a decade at below 5%.
In the previous year, the RBI made substantial profit higher than the earlier years to the tune of Rs. 1.23 trillion. Notably these profits to the RBI are made from the currency trading as well as on government bonds. And a part of which is kept aside for operational and contingency requirements while the remaining is paid out to the government as dividend.
One official known to the development said that the RBI should give in to the demand as the current fiscal year has been exceptional for the apex banking institution and provide the interim dividend.
"We do not want to make an RBI interim dividend a regular thing, but this year can be treated as extraordinary," said the source, adding the government is likely to push for a payout of between Rs 350 billion and Rs 450 billion. And in a case when the demand is being fulfilled, it shall be the third-consecutive year when the RBI grants interim dividend for the government.
Nonetheless, even as there is a call for the dividend, some of the officials are reluctant to extend the package as there will be a impact to cover sovereign risks.