Don't pay heed: FM Sitharaman rejects Cong allegation on RBI fund transfer

Prime Minister Narendra Modi and Nirmal Sitharaman are clueless, says Rahul Gandhi.

Finance minister Nirmala Sitharaman Tuesday rejected Congress leader Rahul Gandhi's allegation that the government was "stealing" from the RBI by taking Rs 1.76 trillion of surplus reserve from the central bank.

Gandhi had criticised the government for the record cash transfer from the central ban, saying Prime Minister Narendra Modi and Sitharaman are "clueless" about solving the "self-created economic disaster" and accused them of "stealing money" from the central bank.

Sitharaman defended the government in a statement on the sidelines of a GST meeting in Pune. "The Congress should have consulted its finance minister and seniors before making these allegations regarding the RBI. Yet, they have become consummate in making such allegations of stealing and I do not want to pay much heed to this," she said.

The remarks come a day after RBI decided to transfer Rs 1.76 trillion of surpluses to a fund-starved government.

Sitharaman said questioning the credibility of the RBI, which had constituted the Bimal Jalan committee on determining the excess capital, is a "worrying" sign.

The committee had eminent people on it and making any allegations like this is "outlandish", Sitharaman said.

"Any suggestion on the credibility of RBI seems a bit outlandish considering the committee was appointed by the RBI itself," she said, adding the government has not decided how to use the windfall from the RBI.

According to some experts, government has accounted for Rs 90,000 crore surplus from RBI in the budget and the money can be used to prop up the sagging growth.

At the time of the constitution of the Jalan panel, former chief economic advisor Arvind Subramanian had said the money should be used for specific purposes like bank recapitalisation.

The excess capital was one of the key issues which had led to the resignation of former governor Urjit Patel in December, and his deputy Viral Acharya in last month, had voiced concerns on the government raiding the balance sheet of the central bank.

Constitution of the committee was the first major decision taken by governor Shaktikanta Das on his appointment in December 2018 following Patel's resignation.