According to the Reserve Bank of India (RBI), the central government will receive a surplus of Rs 99,122 crore.

The decision was made at the RBI’s Central Board of Directors’ 589th meeting on May 21, 2021.

“With the change in the Reserve Bank’s accounting year to April-March (earlier July-June), the Board discussed the working of the Reserve Bank of India during the transition period of nine months (July 2020-March 2021) and approved the Annual Report and accounts of the Reserve Bank for the transition period. The Board also approved the transfer of Rs 99,122 crore as surplus to the Central Government for the accounting period of nine months ended March 31, 2021 (July 2020-March 2021),” RBI said.

The Reserve Bank of India transferred only 44% of its surplus to the government last year, totaling Rs 57,128 crore. Prior to last year, this was likewise the lowest surplus transfer in the previous seven years.

In 2019, the Reserve Bank of India transferred a surplus of Rs 1,23,414 crore to the government.

Every year, as the manager of government finances, the RBI distributes a dividend to the government from its surplus earnings to assist with the government’s finances. The Reserve Bank of India (RBI) was established in 1934 and operates under the Reserve Bank of India Act of 1934. The “Allocation of Surplus funds” clause of Chapter 4 of the Act demands that any profits earned by the RBI from its operations be remitted to the Centre.

According to Section 47 of the RBI Act, “after making provision for bad and doubtful debts, depreciation in assets, contributions to staff and superannuation funds 2 [and for all other matters for which provision is to be made by or under this Act or which’ are usually provided for by bankers, the balance of the profits shall be paid to the Central Government.”