RBI announces record Rs 2.87 lakh cr dividend to govt amid West Asia conflict

The Reserve Bank of India (RBI) on Friday announced a record surplus transfer of Rs 2.87 lakh crore to the Centre for the year ended March 2026, giving the government a significant fiscal cushion at a time of rising import costs and supply chain strains linked to the West Asia conflict.

The payout of Rs 2,86,588.46 crore is 6.7 per cent higher than the Rs 2.69 lakh crore transferred in the previous financial year.

In a statement, the RBI said its net income before risk provisioning and transfers to statutory funds stood at Rs 3.96 lakh crore in FY26, up from Rs 3.13 lakh crore in FY25. The central bank also reported that its balance sheet expanded by 20.61 per cent to Rs 91,97,121.08 crore as of 31 March, 2026.

The decision was taken at a meeting of the RBI’s central board of directors, which reviewed domestic and global economic conditions, including risks to the outlook, before approving the surplus transfer.

The RBI said the revised Economic Capital Framework (ECF) allows flexibility in maintaining the Contingent Risk Buffer (CRB) within a range of 4.5 per cent to 7.5 per cent of the balance sheet size.

Taking into account prevailing macroeconomic conditions, the RBI’s financial performance and the need to maintain adequate risk buffers, the Central Board approved a transfer of Rs 1,09,379.64 crore to the CRB for FY26, sharply higher than Rs 44,861.70 crore in the previous year.

However, the CRB was maintained at 6.5 per cent of the RBI’s balance sheet size, lower than the 7.5 per cent level in FY25.

The 623rd meeting of the RBI central board was chaired by governor Sanjay Malhotra and attended by deputy governors Swaminathan J., Poonam Gupta, Shirish Chandra Murmu and Rohit Jain. Other directors of the board, including Nagaraju Maddirala, secretary, Department of Financial Services; Satish Kashinath Marathe, Revathy Iyer, Sachin Chaturvedi, Anand Gopal Mahindra, Venu Srinivasan and Pankaj Ramanbhai Patel too attended the meeting.

The record transfer comes against the backdrop of heightened economic uncertainty triggered by the West Asia conflict, which has pushed up prices of crude oil, fertilisers and other commodities while disrupting supply chains.

The rupee has also weakened sharply, adding to import costs for India, which depends on overseas purchases for around 88 per cent of its crude oil requirements.

With PTI inputs