The Bimal Jalan panel, which was set up to examine the Reserve Bank of India’s (RBI) economic capital framework (ECF), would recommend the transfer of the central bank’s excess reserves to the government over a period of three-five years, a source privy to the development told FE.
The panel held its last meeting on Wednesday and is learnt to have retained its major recommendations despite a change in its composition after new Finance Secretary Rajiv Kumar had replaced Subhash Chandra Garg as a member.
The surplus transfer could help the government tide over any potential shortfall in its tax revenue and contain fiscal deficit unless the panel ties the transfers to specific use like retiring public debt or recapitalisation of state-run banks.
In February, the RBI decided to offer an interim dividend of Rs 28,000 crore to the Centre, driving up its total transfer in the last fiscal to Rs 68,000 crore. —FE