Former Reserve Bank of India (RBI) governor Bimal Jalan is most likely to chair a panel that will finalise the ideal-level of reserves for the apex bank. The panel will also decide how much of the reserves can be transferred to the government.
The central bank said that the decision to appoint Bimal Jalan was taken on Wednesday after consultation with the government.
Jalan was the governor of the bank during the former NDA regime.
The panel to be headed by Jalan is expected to submit its report by March-end. This suggests that the final decision on this can be expected after the vote-on-account in February and prior next general elections.
The bank said that the committee will be reviewing the existing Economic Capital Framework (ECF), keeping the requirement to maintain financial stability in mind.
Recently, Urijit Patel resigned as RBI’s governor.
While several industry reports estimated that RBI’s surplus capital at Rs 3.5 lakh crore, Union Finance Minister Arun Jaitley repeatedly said the centre is not will to take RBI’s reserves to meet fiscal deficit.
While many reports have estimated RBI’s surplus capital at Rs 3.5 lakh crore, FM Arun Jaitley has repeatedly said the government was not eyeing RBI’s reserves to meet fiscal deficit.
