Delhi: The government has not asked the Reserve Bank to pay any special dividend and is only seeking Rs 13,000 crore of surplus lying with the central bank, Economic Affairs Secretary Subhash Chandra Garg has said.
In August, the RBI had paid a dividend of Rs 30,659 crore for the fiscal ended June 2017. It was less than half the Rs 65,876 crore it had paid in 2015-16.
The government had budgeted for a Rs 58,000 crore dividend from the RBI in its Budget for this fiscal year.
“There is no proposal at this stage to ask for any special dividend. What is being discussed is to only ask for what the RBI earned this year but did not distribute. That is about Rs 13,000 crore. That’s what the government has suggested the Reserve Bank to transfer,” Garg said.
RBI’s profit was about Rs 44,000 crore, of which Rs 30,000 crore has been distributed and Rs 13,000 crore it retained towards risks and reserves. So the government has made a suggestion that the Rs 13,000 crore may also be transferred, he said.
The government had last month announced an unprecedented Rs 2.11 lakh crore capital infusion in PSU banks, which are grappling with high non-performing assets (NPAs).
Asked about the contours of the recap bonds, Garg said “the recapitalisation package is in the final stages. The Department of Financial Services is working on it and soon we would see all these aspects being addressed”.
Of the Rs 2.11 lakh crore, Rs 1.35 lakh crore would be infused through recapitalisation bonds and the remaining Rs 76,000 crore through budgetary support and banks diluting equity in capital market.
Credit rating agency Moody’s had last week upgraded India’s sovereign rating after a gap of over 13 years citing reform push and steps being taken by the government to solve the high NPA problems in the banking sector.
Bad loans in the sector have neared Rs 10 lakh crore.
Garg said Moody’s has acknowledged the reform process and believes that India is in a position to control its debt and put its banking sector in order.
On privatisation of Air India, Garg said it is progressing “reasonably steadily” and the plan about how to privatise has also been broadly worked out.
Asked if it would happen in the current fiscal, Garg said, “I won’t put a timeline on when this is likely. Air India is not just one company, there are other assets.”
The government has ‘in-principle’ decided to disinvest the Air India group as a whole or its constituents fully or part thereof through the strategic sale with transfer of management control.