Current Context : The Reserve Bank of India (RBI) has approved a record transfer of ₹2.69 lakh crore as surplus to the Union Government for the financial year 2024-25.

This marks a 27% increase over the previous year’s dividend payment of ₹2.1 lakh crore .

• Purpose: To bridge fiscal deficits and support government expenditure.
• Factors Contributing to Surplus:
  • Increased sale of foreign exchange reserves, especially in January 2025.
  • Higher interest income from government securities and foreign assets.
  • Gains from forex transactions amid global market volatility.

About Dividend Transfer

• The RBI’s dividend transfer refers to the annual surplus it shares with the central government. This surplus arises from the RBI’s earnings, including interest income from government securities, gains from foreign exchange operations, and other financial activities.