RBI may transfer record ₹2.5–3 lakh cr dividend to govt on forex profits, repo gains: Report

Accord to a Business Standard report, the economist said the Central bank’s repo operations likely contributed to the bumper windfall as well.

In FY24, the RBI had transferred ₹2.1 lakh crore to the government.

“The RBI would have made enough profits last fiscal by way of forex operations as well as the repo operations,” said Madhavankutty G Group, chief economist at Canara Bank, according to the report.

The central bank annually pays out a surplus to the government, drawn from income generated through investments, valuation gains on its dollar reserves, and fees from printing currency.

This amount is determined after accounting for provisioning for bad loans, asset depreciation, employee benefits, and other statutory expenses under the RBI Act.

This year’s transfer is being closely watched as the RBI undertook aggressive dollar sales to shield the rupee from sharp depreciation, raising expectations of higher income from those transactions.

The RBI has been a net dollar seller since October, a strategy that has made the rupee one of the least volatile currencies in Asia and among global peers.

Between April and February of FY25, the central bank sold $371.551 billion worth of dollars and purchased $322.685 billion on a gross basis.

The RBI’s foreign exchange earnings are believed to have surged due to the timing and pricing of its trades — having bought dollars in the ₹83–84 range and sold in the ₹84–87 band.

Such currency interventions, much like commercial trades, allowed the central bank to book profits as it sold higher than it bought.

The RBI dividend is one of the largest revenue streams for the government. As the government’s financial manager, the central bank transfers surplus profit as a dividend annually.

In her Union Budget speech on February 1, Finance Minister Nirmala Sitharaman said the government expects to receive ₹2.56 lakh crore in FY26 from the RBI and public sector banks.