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Informist, Tuesday, May 19, 2026

 

--Fin min source: Hope to get more than INR 3-tln surplus from RBI for FY26

By Sagar Sen

 

NEW DELHI – The finance ministry hopes to get more than INR 3.00 trillion as surplus from the Reserve Bank of India for 2025-26 (Apr-Mar), a senior official told Informist. The RBI's transfer to the government will mainly depend on the surplus available from its operations in the last financial year.

 

"The final decision on the actual surplus will be taken at the RBI's central board meeting later this week. But according to the past trend and current situation, we believe RBI central board may transfer more than INR 3 trillion this year," the official told Informist.

 

Informist had reported Monday that the RBI's central board will likely meet Thursday in Mumbai to discuss and approve the transfer of surplus to the Centre. Along with RBI Governor Sanjay Malhotra and four deputy governors, the 15-member RBI central board comprises Economic Affairs Secretary Anuradha Thakur and Financial Services Secretary, M. Nagaraju.

 

The quantum of RBI's surplus depends on the Contingent Risk Buffer it sets aside. In FY26, the RBI had widened the range of the risk buffer it intends to maintain to 4.5-7.5% from 5.5-6.5% and raised the buffer it maintained to 7.5% of its assets. Fixing a lower buffer would allow RBI to increase the surplus it can transfer to the Centre, the finance ministry official said.

 

Economists and market participants expect the central bank to transfer INR 2.7 trillion to INR 3 trillion to the government as surplus for FY26. The RBI had transferred a record INR 2.69 trillion for FY25. The Budget for FY27 has projected the surplus transfer from the RBI and dividends from public sector banks and financial institutions at INR 3.16 trillion, up 3.7% from the revised estimate of INR 3.05 trillion for FY26.

 

In the ongoing financial year, a higher-than-budgeted transfer of surplus from the RBI will come in handy for the government, which is facing a double whammy due to the ongoing war in West Asia. On one side, the war is likely to slow down economic growth in FY27, which will lead to lower direct and indirect tax collections. On the other hand, the government will most likely have to spend more money to support the economy through higher subsidies, primarily on fertilisers and petroleum fuel products.

 

The RBI surplus may also help the government ensure that it does not exceed the fiscal deficit target of 4.3% of GDP that it has set for FY27.  The government now expects its fiscal deficit for FY27 to rise to 4.5% of GDP, after a downward revision of GDP in absolute terms for earlier years under the new data series.  End

 

Edited by Avishek Dutta

 

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