Reserve Bank will enhance the states' Ways and Means Advances (WMAs) to Rs 47,010 crore, up 46 percent from the current limit of Rs 32,225 crore to help them tide over the COVID-19 crisis.

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The current limit was set by RBI in Feb 2016. Further, RBI will also continue the enhanced interim WMA limit of Rs 51,560 crore granted by RBI due to the pandemic till September 30, 2021.

WMAs are temporary advances given by the RBI to the central and state governments to help them bridge the gap in their receipts and payments. Per the RBI Act, governments are subject to repay the amount "not later than three months from the date of making of the advance."

The RBI's Monetary Policy Committee unanimously voted to keep the repo rates unchanged at 4 percent. The “accommodative” policy stance will continue till prospects of sustained recovery are well secured, Das said.

The apex bank also retained India's GDP growth rate at 10.5 percent in FY22 and announced liquidity support of Rs 50,000 crore. The liquidity support will be used for fresh lending in 2021 to national financial institutions.

The Reserve Bank also estimated the retail inflation for the fourth quarter of fiscal 2021 at 5 percent. It further forecasted inflation to rise by 5.2 percent in Q1 and Q2 FY22, 4.4 percent in Q3, and 5.1 percent in Q4.

Catch live updates on RBI policy here.

First Published:Apr 7, 2021 10:43 AM IST