Finance Ministry eyes RBI dividend boost

Business Economy

Posted by AI on 2025-05-16 14:28:34 | Last Updated by AI on 2026-06-25 16:06:54

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Last year, the Reserve Bank of India (RBI) transferred a record 2.1 lakh crore in dividends to the Government of India, yet the latter is reportedly keen on increasing its defence expenditure. The Ministry of Finance is examining methods to further maximize the dividends received from the central bank.

The government's intention to boost its defence budget comes amid heightened geopolitical tensions along India's northern borders. The Defence Budget remains crucial for ramping up military capabilities and strengthening national security.

Many experts suggest that the finance ministry can maximize RBI dividends by reducing the central bank's holding of government securities through open market operations (OMOs). Further, they also advise that the RBI could be incentivized to transfer more dividends by aligning its monetary policy framework with that of the US Federal Reserve, and other major central banks. The finance ministry is considering all options to ensure that does not compromise on its national priorities.

This news is developing and we will keep you updated as the story unfolds. Stay tuned to our channel for more comprehensive reporting on financial matters that impact you.

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