The Reserve Bank of India (RBI) announced an eye-popping dividend of nearly 1 lakh crore for the last 9 months compared to around Rs 57,000 crore a year ago.

RBIs income for the last 9 months has fallen by about 6.9 percent. However, it is not a surprise as the income a year ago was for a 12 months period. Of total income, the interest income has substantially reduced due to lower interest rates on the Indian government bonds and foreign securities.

However, the other income has risen from Rs 40,000 crore to Rs 64,000 crore and this accounted for the higher dividend. The forex transaction gain went up from Rs 29,000 crore to Rs 50,000 crore.

The RBI also saw a sharp decline in expenditure and provisions. Expenditure fell by nearly 60 percent and provisions fell to nearly Rs 20,000 crore mainly due to lower growth of balancesheet.

The RBI is also cautiously optimistic on the economy in its annual report. It said that so far the growth estimates are around the 10.5 percent forecast that it currently has.

However, RBI said that there are mixed indicators when it comes to April and July high frequency indicators.

The RBI said that for a durable growth revival, both private consumption and investment demand are needed. It also said that growth prospects will depend on how fast India can arrest the second COVID wave.

The RBI also said that the economy has not moderated to the extent it did during the first COVID wave and there is a possibility of a sharp turnaround in growth because of the favourable base effect.

It also ensured that the monetary policy will remain supportive of growth and there will be ample of liquidity in FY22.

To decode the RBI's annual report, CNBC-TV18’s Latha Venkatesh spoke to N S Vishwanathan, former RBI Deputy Governor; Kaushik Das, Chief Economist of Deutsche Bank; Upasna Bhardwaj, Senior Economist at Kotak Mahindra Bank; and Ananth Narayan, Professor at S. P. Jain Institute of Management and Research.

For the full discussion, watch the video.

(Edited by : Bivekananda Biswas)

First Published:May 27, 2021 8:45 PM IST