Arun Jaitley addresses RBI board, says 'There is reasonably high growth as far as revenues are concerned'

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Finance Minister Arun Jaitley on Monday addressed the customary post-budget meeting of the central board of the Reserve Bank. He, reportedly, also highlighted the key points of the interim Budget, including the fiscal consolidation roadmap.

Jaitley after the post-budget meeting said, reported ANI, "Year after year, our experience of the last 5 years has been that there is a reasonably high growth as far as revenues are concerned."

"I think India needs fewer and mega banks which are strong because in every sense from borrowing rates to optimum utilisation the economies of scale as far as the banking sector is concerned are of great help," he added.

According to sources, the meeting also took a call on the interim dividend to be paid to the government during the current fiscal.

As an interim dividend for 2018-19, based on the financial position of the central bank, the government expects Rs 28,000 crore from the RBI. In 2017-18, the RBI had paid an interim dividend of Rs 10,000 crore to the Centre.

The customary post-budget meeting took place against the backdrop of a slight deviation from the fiscal deficit target for the current financial year, tax rebate for income up to Rs 5 lakh and income support scheme for 12 crore farmers.

The government announced the 'Pradhan Mantri Kisan Samman Nidhi' (PM-KISAN) in the budget under which Rs 6,000 per year would be provided to farmers holding cultivable land of up to 2 hectares.

The government also decided to increase standard deduction from Rs 40,000 to Rs 50,000 and raised the TDS threshold on interest earned on bank/post office deposits from Rs 10,000 to Rs 40,000.

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Against the earlier target of 3.3 per cent, in the Interim Budget, the government has projected a fiscal deficit of 3.4 per cent of the GDP for 2019-20.

The government also came out with a roadmap to reduce the fiscal deficit -- the gap between total expenditure and revenue -- to 3 per cent of the gross domestic product (GDP) by 2020-21, and eliminate primary deficit.

Primary deficit refers to the deficit left after subtracting interest payments from the fiscal deficit.

(With inputs from agencies)