Mumbai, May 22 (PTI) The Reserve Bank on Friday announced a record dividend of Rs 2.87 lakh crore to the government for the year ended March 2026, providing a financial boost for the exchequer amid rising import bills and supply chain disruptions due to the West Asia conflict.

The dividend is 6.7 per cent higher than Rs 2.69 lakh crore for the 2024-25 fiscal year.

The surplus transfer by the RBI alone accounts for 91 per cent of the budgeted non-tax revenue under the 'dividend/surplus of Reserve Bank of India, Nationalised Banks and Financial Institutions' head for FY27.

In a statement, the RBI said its net income, before risk provision and transfer to statutory funds, aggregated Rs 3.96 lakh crore in FY26 as against Rs 3.13 lakh crore in FY25.

"The balance sheet of the Bank expanded by 20.61 per cent to Rs 91,97,121.08 crore as on March 31, 2026," the Reserve Bank of India (RBI) said.

The RBI's Central Board of Directors, at its meeting, reviewed the global and domestic economic scenario, including risks to the outlook, and also approved the dividend.

According to the statement, the revised Economic Capital Framework (ECF) provides flexibility to maintain the Contingent Risk Buffer (CRB) between the range of 4.5 per cent and 7.5 per cent of the size of the balance sheet.

"Taking into consideration the current macroeconomic factors, financial performance of the Bank and maintenance of appropriate risk buffers, the Central Board decided to transfer Rs 1,09,379.64 crore towards the CRB for FY 2025-26 as against Rs 44,861.70 crore in the previous year," it said.

The CRB at 6.5 per cent of the size of the RBI balance sheet, compared to 7.5 per cent for 2024-25.

"The Central Board approved the transfer of surplus of Rs 2,86,588.46 crore to the Central Government for the accounting year 2025-26," the RBI said.

Economists said the Rs 2.87 lakh crore dividend is expected to provide a cushion to government finances in the current fiscal, but is unlikely to fully offset the challenges being faced right now amid the geopolitical tensions.

They cautioned that rising subsidy requirements, elevated crude oil prices and slowing revenue growth could still pose risks to the fiscal deficit target.

While some experts said the dividend payout is marginally lower than expectations, others said the central bank could have transferred an additional Rs 64,518 crore had it maintained the contingency risk buffer (CRB) at last year's level.

So, with the flow of dividends by public sector banks and financial institutions, the estimate of Rs 3.16 lakh crore from dividends and surpluses from the RBI, nationalised banks and financial institutions is likely to exceed by a decent margin, as state-owned lenders have earned handsome profits.

The aggregate net profit of public sector banks increased 11.1 per cent to a historic high of Rs 1.98 lakh crore, marking the fourth consecutive year of aggregate profitability for state-owned lenders.

The 623rd meeting of the central board was held under the Chairmanship of Governor Sanjay Malhotra.

Deputy governors Swaminathan J, Poonam Gupta, Shirish Chandra Murmu, and Rohit Jain attended the meeting.

Other directors of the Central 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.

Amid the West Asia crisis, energy prices as well as those of fertilisers and other commodities have shot up, posing financial challenges. The rupee has also depreciated steeply, a scenario that makes imports costlier.

India meets about 88 per cent of its crude oil requirements through imports. PTI NKD HVA

Reserve Bank surplus transfer and contingency risk buffer management shape a record dividend to the government. The Reserve Bank approved a record surplus transfer to the Central Government for FY 2025-26, driven by higher net income, balance-sheet expansion and the revised Economic Capital Framework. The framework allows the Contingent Risk Buffer to be maintained within 4.5 per cent to 7.5 per cent of the balance sheet, and the Central Board increased the buffer transfer before approving the surplus transfer. The dividend forms a major part of non-tax revenue and is linked to macroeconomic risks, buffer management and financial performance.