Reserve Bank of India to transfer $24 billion funds to government

New Delhi: India’s central bank will fork out 1.76 trillion rupees ($24.4 billion) to the federal government, boosting New Delhi’s coffers at a time when it is under pressure to provide a fiscal stimulus to the slowing economy.

The Reserve Bank of India’s board approved the payout, which includes 1.23 trillion rupees as dividend and 526.4 billion from its surplus capital, according to a statement. The transfer from its surplus reserves follows recommendation from a panel named by the RBI.

The federal budget last month estimated 900 billion rupees in dividend income from the RBI, with the money expected to go toward supporting banks and spurring lending. The government will immediately inject 700 billion rupees of fresh capital into state-run lenders, Finance Minister Nirmala Sitharaman said Friday as she announced a raft of measures to stimulate growth.