Surplus bonanza: RBI to transfer ₹1.76-lakh crore to government
Amid slowing economic growth and rising global uncertainty, the Reserve Bank of India (RBI) board on Monday approved transfer of Rs 1.76 lakh crore surplus reserves to the central government. ( RBI Central Board accepts Bimal Jalan Committee recommendations and approves surplus transfer to the Government )
RBI, in consultation with the government, had constituted a six-member expert committee headed by former RBI Governor Bimal Jalan in December last year to review the extant economic capital framework of the central bank.
On 26th August 2019 RBI board accepted Jalan committee recommendations and decided to transfer a sum of ₹1,76,051 crore to the Government of India (Government) comprising of ₹1,23,414 crore of surplus for the year 2018-19 and ₹52,637 crore of excess provisions identified as per the revised Economic Capital Framework (ECF) adopted at the meeting of the Central Board today.( Report of the Expert Committee to Review the Extant Economic Capital Framework of the Reserve Bank of India )
The Committee’s recommendations were based on the consideration of the role of central banks’ financial resilience, cross-country practices, statutory provisions and the impact of the RBI’s public policy mandate and operating environment on its balance sheet and the risks involved.
The Committee’s recommendations were guided by the fact that the RBI forms the primary bulwark for monetary, financial and external stability. Hence, the resilience of the RBI needs to be commensurate with its public policy objectives and must be maintained above the level of peer central banks as would be expected of a central bank of one of the fastest growing large economies of the world.
|The Expert Committee constituted to review the RBI’s extant ECF, was guided by the principle that the alignment of the objectives of the Government and the RBI is important. As a central bank is a part of the Sovereign, ensuring the credibility of the RBI is as important, if not more, to the Government as it is to the RBI itself. The Committee also noted that while there may occasionally arise a difference of views in the conduct of the central bank’s operations, there always needs to be harmony in the objectives of the Government and the RBI.
In recognition of the fact that the RBI forms the primary bulwark for monetary, financial and external stability, the Committee was of the view that the financial resilience of the RBI needs to be maintained above the level of peer central banks, as would be expected of the central bank of one of the fastest growing economies of the world.
Towards this end, the Committee recommended adopting the Expected Shortfall (ES) methodology (in place of the extant Stressed-Value at Risk) for measuring market risk on which there was growing consensus among central banks as well as commercial banks over the recent years. While central banks are seen to be adopting ES at 99 per cent confidence level (CL), the Committee recommended adoption of a target of ES 99.5 per cent CL and a range defined between the target and downward risk tolerance of 97.5 per cent (both under stress conditions). The range is considered appropriate to address the cyclical volatility of RBI’s valuation balances based on historical analysis.
The Committee recognized that the RBI’s Contingency Risk Buffer (CRB) is, inter alia, the country’s savings for a ‘rainy day’ (a financial stability crisis) which has been consciously maintained with RBI in view of its role as Lender of Last Resort (LoLR). Financial stability risks are those rarest of the rare, fat tail risks whose likelihood can never be ruled out, especially in light of the Global Financial Crisis (GFC) and whose impact can be potentially devastating. Public policy prudence and extant statutory provisions require the RBI to maintain appropriate level of risk buffers for this purpose. The Committee recommended that the same be maintained at a range of 5.5 per cent to 6.5 per cent of the RBI’s balance sheet which is above the available level of 2.4 per cent of balance sheet as on June 30, 2018 (vis-à-vis a target of 3.7 per cent of balance sheet).
Application of these recommendations to RBI’s 2017-18 balance sheet is seen to result in RBI’s risk equity levels in a range of 25.4 per cent to 20.8 per cent of balance sheet which will enable the RBI to retain one of the highest levels of financial resilience among central banks globally.
The Committee recognized that the opportunity cost of RBI’s capital is minimal as the RBI returns a major part of the coupon interest on the Government of India Securities (G-Sec) held against its capital, reserves and risk provisions as surplus transferable to Government. Further, the composition and size of RBI’s balance sheet is determined by public policy considerations and generates positive externalities of fostering monetary and financial stability.
The Committee has recommended a surplus distribution policy which targets not only the total economic capital (as per the extant framework) but also the realized equity level of the RBI’s capital. This will help bring about greater stability of surplus transfer to the Government, with the quantum of the latter depending on balance sheet dynamics as well as the risk equity positioning by the Central Board. There will be no transfer of unrealized valuation buffers and these will be used as risk buffers against market risks.
In view of the above recommendation, the excess realized equity as on June 30, 2018 ranges from ₹ 26,280 crores (at upper bound of CRB) to ₹ 62,456 crores (at lower bound of CRB). The excess realized equity as on June 30, 2019 will need to be determined on the basis of RBI’s finalized annual accounts for the financial year 2018-19 as well as the realized equity level decided upon by the RBI’s Central Board.
The Committee recommends the alignment of the financial year of RBI with the fiscal year of the Government for greater cohesiveness in various projections and publications brought out by RBI. Further, in the following years, interim dividend to the Government may be paid only under exceptional circumstances.
The Committee recommends that the framework may be periodically reviewed every five years. Nevertheless, if there is a significant change in the RBI’s risks and operating environment, an intermediate review may be considered.
Top highlights from RBI's board meeting:
- The RBI board accepted the recommendations of the Bimal Jalan Committee, which includes maintaining the realised equity within 6.5-5.5 per cent of balance sheet and economic capital levels at 20-24.5 per cent of balance sheet.
- Based on the recommendation of Bimal Jalan-led committee, the central board of the RBI decided to transfer a sum of Rs 1,76,051 crore to the Government of India comprising of Rs 1,23,414 crore of surplus for the year 2018-19 and Rs 52,637 crore of excess provisions.
- In the last one decade, this is the second time the RBI has transferred its surplus to the govt in excess of Rs 50,000 crore. In 2014, the RBI had transferred Rs 52,679 crore to the govt over a period of three years on the recommendations of the Y H Malegam committee.
- At a time when the govt is desperate to kick start the economy which is slipping into a slow down and is short on liquidity, the surplus fund would help the government achieve its fiscal deficit target for the current fiscal. The government has set a fiscal deficit target of 3.3 per cent of the GDP in the current fiscal, revised downwards from the goal of 3.4 per cent mentioned in the Interim Budget in February.
- The RBI board has also decided to set the economic capital levels comprising the contingency fund and revaluation reserves within the range of 24.5 per cent to 20 per cent of balance sheet as on 30 June.
- As on June 30, 2019, the RBI stands as a central bank with one of the highest levels of financial resilience globally.
- The board reviewed the current economic situation, global and domestic challenges and various areas of operations of the Reserve Bank. The board also approved the Annual Report of the Reserve Bank for the year 2018-19.
- The RBI committee has recommended a surplus distribution policy, which targets the level of realised equity and revaluation balances. The realised equity could be used for meeting all risks as they were primarily built up from retained earnings, while revaluation balances could be reckoned only as risk buffers against market risks as they represented unrealized valuation gains and hence were not distributable.
- The realised equity stood at 6.8 per cent of balance sheet, while the requirement recommended by the Committee was 6.5 to 5.5 per cent of balance sheet. The RBI board has decided to maintain the realised equity level at 5.5 per cent of balance sheet and the resultant excess risk provisions of Rs 52,637 crore were written back.
- The committee has recommended the adoption of Expected Shortfall (ES) methodology under stressed conditions for measuring the RBI's market risk on which there was growing consensus among central banks as well as commercial banks over the recent years. While central banks are seen to be adopting ES at 99 per cent confidence level (CL), the Committee has recommended the adoption of a target of ES 99.5 per cent CL keeping in view the macroeconomic stability requirements.
Major recommendations of the Committee with regard to risk provisioning and surplus distribution
(i) RBI’s economic capital: The Committee reviewed the status, need and justification of the various reserves, risk provisions and risk buffers maintained by the RBI and recommended their continuance. A clearer distinction between the two components of economic capital (realized equity and revaluation balances) was also recommended by the Committee as realized equity could be used for meeting all risks/ losses as they were primarily built up from retained earnings, while revaluation balances could be reckoned only as risk buffers against market risks as they represented unrealized valuation gains and hence were not distributable. Further, there was only a one-way fungibility between them which implies that while a shortfall, if any, in revaluation balances vis-à-vis market risk provisioning requirements could be met through increased risk provisioning from net income, the reverse, i.e., the use of surplus in revaluation balances over market risk provisioning requirements for covering shortfall in provisions for other risks is not permitted. The Committee recommended revising the presentation of the liabilities side of the RBI balance sheet to reflect this distinction.
(ii) Risk provisioning for market risk: The Committee has recommended the adoption of Expected Shortfall (ES) methodology under stressed conditions (in place of the extant Stressed-Value at Risk) for measuring the RBI’s market risk on which there was growing consensus among central banks as well as commercial banks over the recent years. While central banks are seen to be adopting ES at 99 per cent confidence level (CL), the Committee has recommended the adoption of a target of ES 99.5 per cent CL keeping in view the macroeconomic stability requirements. In view of the cyclical volatility of the RBI’s revaluation balances, a downward risk tolerance limit (RTL) of 97.5 per cent CL has also been articulated. Both levels were stress-tested for their adequacy by the Committee.
(iii) Size of Realized Equity: The Committee recognized that the RBI’s provisioning for monetary, financial and external stability risks is the country’s savings for a ‘rainy day’ (a monetary/ financial stability crisis) which has been consciously maintained with the RBI in view of its role as the Monetary Authority and the Lender of Last Resort. Realized equity is also required to cover credit risk and operational risk. This risk provisioning made primarily from retained earnings is cumulatively referred to as the Contingent Risk Buffer (CRB) and has been recommended to be maintained within a range of 6.5 per cent to 5.5 per cent of the RBI’s balance sheet, comprising 5.5 to 4.5 per cent for monetary and financial stability risks and 1.0 per cent for credit and operational risks. Further, any shortfall in revaluation balances vis-à-vis the market risk RTL would add to the requirement for realized equity. The Committee also recommended the development of methodologies for assessing the concentration risk of the forex portfolio as well as jointly assessing the RBI’s market-credit risk.
(iv) Surplus Distribution Policy: The Committee has recommended a surplus distribution policy which targets the level of realized equity to be maintained by the RBI, within the overall level of its economic capital vis-à-vis the earlier policy which targeted total economic capital level alone. Only if realized equity is above its requirement, will the entire net income be transferable to the Government. If it is below the lower bound of requirement, risk provisioning will be made to the extent necessary and only the residual net income (if any) transferred to the Government. Within the range of CRB, i.e., 6.5 to 5.5 percent of the balance sheet, the Central Board will decide on the level of risk provisioning.
In a move that will help the Centre bridge its fiscal deficit, the Central Board of the Reserve Bank of India on Monday decided to transfer a staggering ₹1,76,051 crore as surplus transfer to the government for 2018-19.
This amount is also much more than what the government is expecting (₹1,05,000 crore) via disinvestment in FY20.
This is the biggest-ever pay-out by the central bank. The central bank had transferred ₹50,000 crore in 2017-18. The RBI’s balance sheet size as at June-end 2019 stood at ₹9,57,036 crore.
The surplus transfer includes ₹52,637 crore of excess provisions identified as per the revised Economic Capital Framework (ECF), which was recommended by the Bimal Jalan Committee and adopted at the Central Board’s meeting.
The move will buoy the government’s non-tax revenues at a time when tax collections have been subdued due to an economic slowdown. Top RBI officials had recently raised concerns about transferring such a huge amount from the reserves to the national exchequer. Former Deputy Governor Viral Acharya, in a speech in October 2018, had flagged as thorny the issue of transfer of excess reserves to the government.
Acharya had warned: “Governments that do not respect central bank independence will sooner or later incur the wrath of financial markets, ignite economic fire, and come to rue the day they undermined an important regulatory institution……”
Former RBI Governor D Subbarao too had said recently that “raiding” the reserves of the central bank showed the “desperation” of a government.
Using the revised ECF to determine risk provisioning and surplus transfer (premised on maintaining the realised equity level at 5.5 per cent of the balance sheet), the excess risk provisions worked out to ₹52,637 crore, which was written back.
Contingent Risk Buffer
The realised equity could be used for meeting all risks/losses as it is primarily built up from retained earnings. It is also required to cover credit risk and operational risk. This risk provisioning made primarily from retained earnings is cumulatively referred to as the Contingent Risk Buffer (CRB). This has been recommended to be maintained within a range of 6.5 per cent to 5.5 per cent of the RBI’s balance sheet.
“Given that the available realised equity stood at 6.8 per cent of balance sheet, while the requirement recommended by the Committee was 6.5 per cent to 5.5 per cent of the balance sheet, there was excess of risk provisioning to the extent of ₹11,608 crore at the upper bound of the CRB and ₹52,637 crore at the lower bound of the CRB. The Central Board decided to maintain the realised equity level at 5.5 per cent of the balance sheet and the resultant excess risk provisions of ₹52,637 crore were written back,” the board said. While the revised framework technically would allow the RBI’s economic capital levels as on June 30, 2019, to lie within the range of 24.5 per cent to 20.0 per cent of the balance sheet, the economic capital as on June 30, 2019 stood at 23.3 per cent of the balance sheet.
The math behind RBI’s Rs 1.76 lakh crore surplus transfer to the Central Government
Article by BL Research Bureau - (The math behind RBI’s Rs 1.76 lakh crore surplus transfer to the Central Government)
The RBI earning a robust net income and write back of excess provisions in the contingency fund have led to the massive pay out. This may not recur
BL Research Bureau
The Bimal Jalan Committee-recommended surplus transfer by the Reserve Bank of India (RBI) has offered a much-needed respite to the Centre, in the current fiscal. Excluding the Rs 28,000 crore interim dividend already paid by the RBI to the Centre last fiscal, the Rs 1,48,051 crore of transfer in the current financial year, could make up for the shortfall in tax collections to a great extent.
True, the market had already pencilled in some windfall gains by way of RBI’s higher than the usual dividend, but what has come as a surprise is the one-time bonanza, rather than a staggered pay out as was broadly expected.
While the Centre dipping into the RBI’s coffers, to meet its fiscal deficit, has not gone down well with many economists and market players, what offers some comfort is the fact that the committee has decided to keep the RBI’s revaluation reserves out of the funds that can be distributed. Also, given that much of the excess provisions under the RBI’s contingency fund has been transferred in the current fiscal year, a similar pay out may not happen in the next financial year. This mitigates the concern over the Centre dipping into the central bank’s coffers time and again for its needs.
On the flip side though, with the contingency fund now at the lower band of the desired 5.5-6.5 per cent of the balance sheet, the RBI is left with little wiggle room in future.
What the committee recommends
Before we delve into what the Jalan panel report recommended, let us break down the reserves of the RBI.
The RBI’s reserves consist of currency and gold revaluation account (CGRA), the investment revaluation account, the asset development fund (ADF) and the contingency fund (CF). The CGRA makes up the chunk of the reserves and has gone up substantially since 2010---at a compounded annual growth rate (CAGR) of 25 per cent to Rs 6.91 lakh crore in 2017-18. It essentially reflects the unrealized gains or losses on the revaluation of forex and gold.
Next, the CF constitutes over a fourth of the RBI’s reserves. The CF is a specific provision made for meeting unexpected contingencies from exchange rate operations and monetary policy decisions. The RBI contributes a notable portion of its profit to the CF.
The IRA is sub-divided into IRA-foreign securities (IRA-FS) and IRA-rupee securities (IRA-RS). The former reflects the unrealised gain or loss on the mark-to-market of foreign securities while the latter is on account of marking rupee securities. The ADF has been created to meet internal capital expenditure and make investments in subsidiaries and associated institutions.
The IRA and ADF constitute a small portion of the RBI’s reserves.
A peek into RBI's key reserves
|FY||Balance in CF (Rs cr)||Balance in CGRA (Rs cr)||CF % of total assets||Total reserves % of total assets|
|Jalan panel recommendation||5.5-6.5||20-24.5|
CGRA: currency and gold revaluation account, CF: Contingency Fund
Arriving at the surplus transfer
The amount of surplus that the RBI must transfer to the Centre is determined based on two things---realized equity and economic capital.
The ‘realized equity’ is the risk provisioning made primarily from retained earnings referred to as the Contingent Risk Buffer (CRB). This is essentially the existing amount in the RBI’s CF. The Jalan panel has recommended that the CF be maintained within a range of 6.5 per cent to 5.5 per cent of the RBI’s balance sheet.
The current CF outstanding stood at 6.8 per cent of the RBI’s balance sheet and hence, the excess from the pre-decided range of 5.5-6.5 per cent is written back. Here, the panel decided to go with the lower threshold of 5.5 per cent and hence the excess Rs 52,637 crore has been written back (to be transferred to the Centre).
Two, at the aggregate level, the panel suggests maintaining economic capital--- realized equity and revaluation balances (essentially CGRA)—at a range of 24.5 per cent to 20 per cent of balance sheet. Since it stood at 23.3 per cent as of June 2019---within the desired range, the entire net income of the RBI of Rs 1,23,414 crore for the fiscal (without transferring to the CF) has been transferred to the Centre as surplus.
Hence a total of Rs 1,76,051 crore has been paid out to the Centre.
What’s of concern?
The RBI had been contributing a chunk of its profit to the contingency fund up to 2012-13. Between 2010-11 and 2012-13, the RBI had set aside 32-45 per cent of its gross income to this fund. Hence CF was a high 9-10 per cent of total assets.
Additions to this fund though had ceased since 2013-14. The entire surplus in the RBI’s coffers was being transferred to the Centre. But from 2016-17, the RBI once again started transferring funds to the CF. The CF has been 6-7 per cent of assets over the past three to four years.
The Jalan panel has chosen to opt for a lower 5.5 per cent level for the CF (as against the upper end of 6.5 per cent). This is the lowest level that the RBI has maintained thus far under the fund. This lowers the RBI’s flexibility to manoeuvre in future.
May not repeat
The current year’s transfer from the CF has also lowered the buffer for excess transfer of provisions next year. A strong growth in balance sheet may in turn, require the RBI to transfer some portion of its earnings to the CF next year to maintain the 5.5 per cent threshold, eating into the surplus funds accruing to the Centre. Over the last eight years, the RBI’s balance sheet has grown by 10-11 per cent annually.
Secondly, the net income of Rs 1,23,414 crore earned by the RBI 2018-19 (July - June), is quite large. In 2017-18, the RBI had earned a net income of Rs 50,000 crore. Such a robust growth may also not recur next year.
The strong net income in 2018-19 may have come about due to the net interest on LAF (liquidity adjustment facility) operations turning positive after being negative for two years.
In 2016-17, the net interest on LAF operations slipped to a negative of Rs 17,426 crore. Banks flush with funds post-demonetisation lent to the RBI through the reverse repo option under LAF. The interest paid by the RBI to the banks under reverse repo in 2016-17 had eaten into its income. In 2017-18, lower surplus liquidity in the banking system vis-a-vis the previous year led to a lower interest outgo for the RBI under reverse repo window. The RBI’s net interest income from LAF operations, increased by about Rs 7,900 crore in 2017-18, though still a negative Rs 9,541 crore, owing to continuing interest outgo under reverse repo.
It is possible that in 2018-19, the net interest income was positive owing to tight liquidity, leading banks to borrow from the RBI, earning it a tidy income.
Such a steep growth in net income may not necessarily recur, hence limiting the funds transferred to the Centre next year.
For the current year though, the huge amount handed over to the Centre may just do the trick on the fiscal deficit front. Over Rs 65,000 crore or so of additional non-tax revenues (than what was budgeted for FY20) on account of the RBI’s dividend, can make up for the shortfall in the Centre’s tax collections to a great extent.
Based on CGA provisional figures for FY19 (in which income tax grew by a modest 7 per cent), the estimated growth in income tax collections for FY20 works out to 23 per cent. For April-June, CGA data suggests that the net revenue growth from direct taxes was just 9.7 per cent. There is a lot of uncertainty over goods and services tax (GST) collections too. Hence the RBI’s surplus could boost overall revenue for the Centre and help meet its fiscal deficit target.
However, the manner in which the funds are used will be critical. The share of capital expenditure as a per cent of GDP has been falling in recent years. In India, the bulk of government spending is mostly biased towards boosting consumption rather than investments. This time around, the Centre will need to put the RBI’s surplus funds to productive use, that can have a sustainable multiplier impact on overall growth in the economy.
What does RBI transfer of Rs. 1.76 Lac Crore to Government means for economy?
RBI has approved transfer of Rs 1.76 lakh crore surplus reserve to government
- Many economists have termed the move as a "lifeline" for the government
- All eyes will be on how the government uses this amount amid economic slowdown
Many economists have termed the move as a lifeline for the government, which is exploring options to revive economic growth amid a period of sluggish consumer demand and weak investments.
What economists say
The move is expected to help the government at a time when India is going through a period of economic slowdown, triggered by slower consumption demand and weaker investment.
However, economists remain divided over the new surplus transfer policy. Some economists had expected the RBI to release staggered payment to the government instead of everything in one shot.
Some economists have welcomed the move as it will help the government counter the shortfall in revenue and tax collection. Since inflationary pressure is low, economists believe that the move will not have a negative impact in the long run.
Another group of economists which include the likes of Raghuram Rajan and former RBI governor Urjit Patel said earlier that the move could put RBI in a vulnerable position apart from diminishing its autonomy.
Former chief statistician of India Pronab Sen told business daily Livemint that keeping the RBI at a "rock-bottom" level is not a good idea, adding that this could become the norm from now onwards.
Former RBI deputy governor Rakesh Mohan, who was the vice-chairman of the expert panel on ECF, clarified that the transfer of surplus reserves is not a raid on the RBI's balance sheet.
He cited the controversy of surplus capital transfer between the government and RBI when Urjit Patel was the apex bank's governor and said government officials believed that RBI was sitting on excess capital and wanted it to transfer extra to the central budget. However, the RBI under Patel disagreed with the government.
Mohan further added that it was not a raid as the decision was based on the ECF committee's report, which was agreed upon unanimously and signed by all the members including the government representative, Finance Secretary Rajiv Kumar.
Task for the Central Bank: RBI now has to closely monitor the market situation in the country and abroad, following which it could take a call on whether to maintain the upper bound or lower bound of the contingency reserve in future.
Mohan, however, explained that the high rate of surplus transfer can be credited to the RBI's good market operations in 2018-19. He told Bloomberg Quint that RBI's balance sheet went up significantly due to Open Market Operations (OMO) that were conducted by the central bank during the year.
Most of the economists agreed that the move can help the government in providing a stimulus the economy besides aiding recapitalisation of core sectors. It will also help the government make up for the shortfall in its tax collections to a major extent.
Economists have made it clear that the manner in which the government utilises the excess fund will be crucial in reviving the economy. In a nutshell, the trick lies in boosting investments in core sectors rather than focusing on uplifting consumption.
Controversy surrounding excess reserves
Long before the government formed the Bimal Jalan-led expert panel on ECF, a controversy was brewing between the central bank and the government. As mentioned earlier, the RBI under Urjit Patel was facing constant pressure from the government to increase the amount of surplus transfer.
Patel disagreed with the government's assertion on RBI's reserves. While the issue of surplus transfer is not directly related to Patel's resignation, cracks between the government and RBI over this issue were visible days before Patel resigned.
The prime debate at the time was the larger issue of RBI's independence, which according to Patel and his deputy were being attacked by the government when it invoked Section 7 of the RBI Act, which empowers the government to give directions to the central bank on matters of public interest.
But that's not the only controversy surrounding the excess reserves of the RBI. A Business Standard report indicated former finance secretary Subhash Chandra Garg who was not in favour of the recommendations of the Jalan committee and expressed dissent.
Garg's removal from the top job at the finance ministry played a huge role in the approval of the Jalan committee report. He reportedly wanted to draw money from the RBI's core revaluation accounts, but the demand did not reach a consensus among other members of the panel including Bimal Jalan and vice-chairman Rakesh Mohan.
Following Garg's exit from the top position, his replacement Rajiv Kumar decided to agree with the committee's recommendations of not touching the revaluation reserves, following which the report was cleared.
How the government should use the RBI's gift
The debate on whether the Rs 1.76 lakh crore surplus reserve transfer to the government tarnishes the RBI's autonomy can wait for another day. Since the amount may not be so huge next year, it is almost like RBI's gift to the Finance Minister Nirmala Sitharaman and the government.
NR Bhanumurthy, professor at National Institute of Public Finance and Policy, is of the opinion that the ball is now in the government's court. Speaking with India Today TV he said, "The government needs to use this money wisely otherwise the slowdown which has been prevailing in the economy will continue and it will be difficult for us to bounce back. The money needs to be used to boost the economy and not just for government consumption."
Before the RBI's announcement, the government had budgeted Rs 90,000 crore as surplus and dividend transfers from RBI for the current fiscal. However, it will now get Rs 86,000 crore more than the budgeted amount.
It is almost three times (2.7 times) more than what RBI governor Shaktikanta Das's predecessors ever managed--something that the government had been seeking desperately since Urjit Patel was at the helm.
While some opposition leaders and economic experts including Raghuram Rajan and former RBI governor Urjit Patel raised doubts over the development, the excess surplus reserve transfer gives the government a handful of options to stabilise dwindling economic growth.
Source: rbi.org.in , Business Line, India Today, LivMint, Bloomberg, Business Standard