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RBI explains transfer of higher surplus to centre

The Reserve Bank of India said the high income earned via sale of foreign exchange led to higher transfer of surplus from the central bank to the Centre. RBI’s Annual Report for 2020-21 said the FY21 ended with the overall surplus of Rs 99,122 crore for the RBI against Rs 57,127.53 crore in the previous year. The earning from foreign exchange transactions recorded a 69% rise in FY21 for the central bank. The annual report accounts for only 9 months from July 2020-March 2021 because it is in the process of transitioning to an April-March fiscal from July-June earlier. The RBI’s balance sheet in FY21 (July-March) increased by 6.99% for the year ended 31 March 2021, mainly reflecting its liquidity and foreign exchange operations. The increase on the asset side was mainly due to increase in foreign and domestic investments by 11.485 and 13.75%, respectively, while the liability increase was due to increase in deposits (26.85%), notes issued (7.26%) and other (43.05%), respectively. While income for the year decreased by 10.96%, the expenditure decreased by 63.10%, it said. There has also been a provision of Rs 20,710.12 crore made and transferred to the Contingency Fund of the Centre, and it includes the total expenditure of Rs 34,146.75 crore in FY21. In FY20, the RBI’s expenditure stood at Rs 92,540.93 crore, which included Rs 73,615 crore towards transfer to CF.

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