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Informist, Friday, May 29, 2026

MUMBAI – Following are the highlights of Reserve Bank of India's Annual Report for 2025-26 (Apr-Mar), released Friday.

CENTRAL BANK'S ACCOUNTS

* Balance sheet INR 91.97 tln on Mar 31, up 20.6% YoY

* Provision of INR 1.09 tln moved to contingency fund FY26
* FY26 net income INR 2.87 tln vs INR 2.69 tln FY25
* FY26 gross income INR 4.28 tln vs INR 3.38 tln FY25
* FY26 total expenditure INR 1.41 tln vs INR 697.14 bln FY25
* Gain from foreign exchange transactions INR 1.69 tln in FY26
* CONTEXT: RBI gained INR 1.11 tln from foreign exchange transactions FY25

* Interest income from foreign securities INR 1.08 tln in FY26
* CONTEXT:RBI FY25 interest income from foreign securities was INR 970.07 bln

* FY26 income from foreign sources INR 3.28 tln, up 26.6% YoY
* FY26 net income from domestic sources INR 1.00 tln, up 25.9% YoY

MACROECONOMY

* India econ expected to remain resilient in FY27
* India econ seen resilient despite challenging external environment
* India growth prospects supported by strong macroecon fundamentals

* Prolonged West Asia conflict poses downside risk to India econ

* Cos, bks healthy balance sheets bode well for India growth trajectory

* Govt's thrust on capex bode well for India growth trajectory

* Implementation of trade pacts to provide momentum to India's growth
* Likelihood of El Nino conditions poses downside risks to farm output
* FY26 measures led to robust credit offtake, better policy transmission
* MPC acted in timely, calibrated manner to cut rates FY26
* Monetary policy actions during FY26 remained growth supportive

* Monetary policy dept to strengthen econ forecasts, policy analysis FY27
* Fiscal outlook for states remains positive for FY27
* Monetary policy dept to review, improve GDP growth forecasting FY27
* Monetary policy dept to review, improve inflation forecasting FY27
* Inflation in FY27 seen aligned with 4% target

* Monetary policy dept to estimate natural real rate of interest FY27
* Monetary policy dept to estimate potential GDP, growth rate FY27
* Monetary policy dept to review quarterly projection model FY27
* Spike in global fuel prices poses upside risks to inflation

* Trade pacts to boost India's trade, invest opportunities
* Geopolitical tensions may pose near-term risks to corporate earnings
* Geopolitical stress may pose risks to corporate loan portfolios
 

FINANCIAL SECTOR, MARKETS

* Liquidity ops to continue to be in sync with stance of monetary policy

* To review directions on interest rates on advances

* To review directions on credit risk management in FY27
* FX ops to be principle-based, guided by aim of orderly rupee movement
* To review market mechanisms for credit risk distribution in FY27
* To strengthen Central KYC Records Registry Framework in FY27

* To extend video-based customer identification for onboarding NRIs
* Sensitivity of farm output to rainfall variability has moderated

* To expand CBDC pilot in direct benefit transfer schemes

* To explore additional pilots on tokenisation of financial assets

* Aim for sectoral deployment of credit to include non-bk sources FY27
* To boost transparency in pricing for retail via FX ops disclosure FY27

* To develop AI innovation sandbox for financial sector
* To create framework for use of AI in financial sector
* India bond yields could rise if global monetary easing cycle stalls
* To merge gilts secondary mkt transactions' circulars to one master norm
* India bond yields could rise if global monetary easing cycle reverses
* Govt cash balances rose INR 1.67 tln FY26 vs INR 937 bln fall FY25
* To initiate micro-data analytics project for cyber risk

* Liquidity injection, govt fiscal consolidation to contain rise in ylds

* Currency in circulation withdrawal INR 4.43 tln vs INR 2.13 tln FY25
* To review risk-based approach for KYC supervision

* Net FX sales drained INR 4.69 tln liquidity FY26 vs INR 2.91 tln FY25

* Local currency settlement to up rupee-based cross-border transactions

* To conduct liquidity mgmt ops for monetary policy transmission FY27

* Net OMO purchases INR 8.78 tln FY26 vs INR 2.59 tln FY25

* Robust services trade balance outlook to support current account FY27
* Term repo auction INR 1.62 tln FY26 vs INR 1.83 tln FY25
* To undertake FX ops to curb excessive volatility in rupee FY27

* To issue guidelines on digital forensic readiness

* Trade pacts to facilitate capital inflows to India in FY27

* To hold policy-oriented research, analysis on financial markets FY27

* India banking system to remain resilient, supported by credit growth

* To assess cyber risks from AI tools, systems by supervised entities

* India fincl system has sufficient buffers to withstand adverse shocks

* To create supervisory data quality index for tier 3, 4 urban co-op bks

* RBI agenda to be anchored around customer protection
* RBI agenda to be anchored around strengthening credit ecosystem

* To focus on strengthening KYC framework
* Weighted avg call rate averaged 5.29% in Q4 FY26 vs 5.36% Q3
* To review credit, liquidity risk stress testing framework for NBFCs
* To conduct cyber mapping exercise for upper, middle layer NBFCs
* CP-T-bill spread averaged 227 bps bps Q4 FY26 vs 134 bps year ago
* FY27 supervisory agenda to focus on early detection of emerging risks
* FY27 supervisory agenda to focus on strengthening root-cause analysis

* 10-year g-sec yield averaged 6.76% Q4 FY26 vs 6.57% Q3
* Aim for migration of select NBFCs to risk-based supervision
* To examine risk-based supervision framework roll-out for some NBFCs
* To examine risk-based supervision framework roll-out for urban co-op bks
* To expand CBDC pilot to cover new use cases
* Reviewing  FEMA norms for FX acct of person resident in India
* To expand CBDC pilot for direct benefit transfer schemes
* 125-bps rate cut transmission to NBFC lending rates 16 bps FY26
* To expand CBDC pilot to new use cases in domestic retail space
* To develop consumer complaint management system 2.0
* To explore more CBDC pilots on tokenisation of financial assets
* Intend to operationalise bilateral CBDC pilots with select use cases
* To scale up Unified Lending Interface through more lenders
* To focus on enhancing digital safety
* Export invoicing in INR up 6.5% YoY, import invoicing up 9.5% YoY FY26
* DICGC total insured deposits INR 104 tln Sept 30 vs INR 97 tln yr ago
* Export settlement in INR up 2.7% YoY, import settlement up 41% YoY FY26
* Need continuous assessment of global situation for policy response
* Better managed bks to pay lower premium to DICGC FY27 onwards
* DICGC total claims settled INR 19.88 bln in FY26
* To review deposits regulations, FX mgmt insurance norms in FY27
* DICGC deposit insurance fund INR 2.62 tln as of Mar 31, up 14% on yr
* To review FX management non-debt instruments rules in FY27
* Geopolitical developments to drive Indian equity markets
* Global financial mkt volatility to drive Indian equity markets
* FPI flows to drive Indian equity markets
* Net unrealised loss on FX forwards INR 434.03 bln FY26 vs gain FY25
* Developed model to estimate impact of fincl stress on India's GDP
* To review framework of financial network, contagion analysis
* To assess climate risks using hypothetical stress events
* ECL to strengthen credit risk management, improve comparability
* Will manage FY27 mkt borrow orderly on fisc gap aim, mkt conditions

* ECL norms to align regulatory framework with global fincl principles
* To review non-competitive bidding norms in gilts, T-bills, state bonds
* To onboard 'Retail Direct' holdings under account aggregator framework
* Consultation on draft stressed assets securitisation norms underway
* To nudge states to adopt benchmark issuance strategy for debt mgmt FY27
* Weighted avg gilt yield softened by 27 bps FY26
* Consolidation of master directions to reduce entities' compliance cost
* To aid INR internationalisation via operationalising Global SFMS Hub
* CONTEXT: Global SFMS Hub is RBI's cross border messaging system
* To link UAE's fincl messaging system with Global SFMS Hub in FY27
* Development of customer-facing unified lending interface app underway
* Reviewing monetary policy surveys to improve methodology, coverage
* MuleHunter.ai implemented in 26 banks FY26, 4 more bks underway
* Exploring new data sources as high-frequency indicators for svcs sector
* To begin framework on FX swap system for SAARC nations for 2027-2030
* To deploy FX assets in more diversified book to optimise risks FY27
* To deploy FX assets in more diversified book to improve returns FY27
* To deploy FX assets in more diversified book amid global risks FY27
* 117 lenders onboarded unified lending interface as of Mar 31
* To upgrade FX reserve mgmt systems, processes for better risk mgmt
 

End

Compiled by Vinodini Yadav
Filed by Avishek Dutta

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