RBI Board meeting HIGHLIGHTS: The much-awaited Reserve Bank of India (RBI) board meeting has concluded after nine gruelling hours, in which a presentation on the central bank reserves was made in front of the board in the first half.
The meeting was scheduled amid reports of rising tensions between the central bank and the government. A range of issues were on the table in the meet today ranging from the surplus reserves of the central bank to credit to MSMEs.
It was also expected that the government and central bank would talk in detail on the issue of ‘appropriate’ economic capital framework. Meanwhile, Finance Minister Arun Jaitley on Saturday had said that the economic growth must not be stalled by restricting credit availability and liquidity. He said that the cleaning up of balance sheets of the banks due to “collectively committed sins” between 2008-14 should not slow down the growth.
Every year the central bank transfers the balance of its profits to its owner, the government, as per the RBI Act, after making provisions for bad or doubtful debts, contribution to staff, depreciation of assets and superannuation funds. The RBI board has decided to form a panel to look into the surplus transfer mechanism of the central bank, which has been one of the issues of conflict between the government and the RBI. Read full story