Government is set to exceed its target of dividend and surplus receipt from Reserve Bank of India (RBI), commercial banks and other financial institutions (FIs) by 14%. This will help government to curb fiscal deficit and to make state-run banks healthier by injecting fresh capital. RBI has decided to transfer Rs 65,896 crore to the government from the surplus it generated, 2% more than Rs 64,477 crore as what the government was expecting from RBI, banks and FIs cumulatively. Transfer of surplus from RBI along with dividends from state-run banks and public sector entities comprise a significant chunk of non-tax receipts.
The government has lowered its estimates about 31% from Rs 10,887 crore budgeted earlier for dividend payout from public sector banks and state-owned financial institutions as the state-run lenders face a financial strain.
According to the estimation, if FIs and banks together pay dividend of Rs 7,481 crore, then government would end up raising 14%more at Rs 73,4412 crore. Last year, RBI had paid Rs 52,679 crore with banks and FIs giving Rs 7,679 crore as dividend for 2013-14. The highest payout was by Life Insurance Corporation of India at Rs 1,634 crore followed by State Bank of India at Rs 1,312 crore. The government has budgeted to receive Rs 36174 crore as dividend from public sector undertakings.