Government yet to decide how to utilise Rs 1.76 lakh crore given by RBI, says Nirmala Sitharaman
The finance minister said questions about the credibility of the top bank or the panel that decided on transferring the amount to the Centre were ‘outlandish’.
Union Finance Minister Nirmala Sitharaman on Tuesday said the government was yet to decide how to utilise Rs 1.76 lakh crore that it will get from the Reserve Bank of India.
In its meeting on Monday, the RBI’s central board decided to transfer Rs 1,23,414 crore of surplus for the year 2018-’19 and Rs 52,637 crore of excess provisions identified by a revised economic capital framework. The RBI’s decision to transfer Rs 1.76 lakh crore to the government came after the central bank accepted the recommendation of a panel led by Bimal Jalan, a former governor of the bank. The move has been heavily criticised.
“Announcements by the government had come after consultations with all the sectors, including the auto sector,” said Sitharaman. She added that the decision was made by a committee comprising eminent experts whose named the bank had picked and that the government had had no role in choosing members of the Jalan panel. “They gave a formula based on which the amount [Rs 1.23 lakh crore] was arrived at,” Sitharaman said. “Any suggestions about the credibility of RBI, therefore, for me seems a bit outlandish.”
The economic capital framework had reportedly been a cause of disagreement between the government and the RBI last year. The framework governs the terms of transfer of the RBI’s surplus reserves to the government. Urjit Patel, who was then the RBI governor, had quit in December amid reports of a rift before the Jalan panel was formed.
Last week, Sitharaman had announced a slew of measures to boost the economy, less than two months after presenting the Union Budget.
Request tax collectors not to overreach, overstate: Sitharaman
Sitharaman also said that she had asked tax officials to observe “a bit of restraint” and not to overreach while collecting taxes. “We have decided with the consultation with all authorities that the deadlines for the targets are not impossible...they are achievable deadlines, they are realistic deadlines and therefore my request to the tax collectors was not to overreach, not to overstate in the collection process,” Sitharaman said after a meeting with the Central Board of Indirect Taxes, Customs, Income Tax Department and other officials in Pune.
The finance minister said that businesses create jobs and wealth for the country so it was important for officials to facilitate them during tax collection and enforcing rules. She said the government wanted entrepreneurs to carry on with their business without a worry. Sitharaman said the government was open to discuss Goods and Services Tax rates with stakeholders.
Shrugs off Rahul Gandhi’s criticism
Congress leader Rahul Gandhi on Tuesday claimed that the RBI’s decision showed that Narendra Modi and Sitharaman were clueless about fixing the economy. “PM and FM are clueless about how to solve their self created economic disaster,” Gandhi tweeted. “Stealing from RBI won’t work – it’s like stealing a Band-Aid from the dispensary and sticking it on a gunshot wound.”
Asked about Gandhi’s reactions, Sitharaman said, “I don’t want to attach much importance to what Rahul Gandhi has said. Whenever Rahul Gandhi raises things like ‘chor, chori,’ one thing comes to my mind, he tried his best ‘chor, chor, chori’, but public gave him befitting reply. What’s the point of using the same words again?”
During the Lok Sabha election campaign earlier this year, Gandhi had often referred to Modi as a “chor”, or thief. The Congress won only 51 seats in the Lok Sabha.