Subhash Chandra Garg: Government's fiscal math "is completely on track"

Guwahati: Subhash Chandra Garg, economic affairs secretary in the finance ministry said, There is no proposal from the government to ask the Reserve Bank of India to transfer its surplus reserves.

Denying the reports earlier this week claiming that it was seeking between Rs. 1 lakh crore and Rs. 3.6 lakh crore from the central bank's reserves, over a tweet, Garg said the government's fiscal math "is completely on track".

https://twitter.com/SecretaryDEA/status/1060802211440222208

Mr. Garg added that the only proposal concerning the reserves that the government was discussing ways to fix the appropriate economic capital framework of the RBI. That framework is used to decide the adequate amount of reserves the central bank should maintain.

It may be mentioned that the government and the RBI have been clashing on several issues including the reserves question, and a government proposal to ease the capital and lending curbs for state-run banks. The rift has widened sharply in the past few weeks and will be taken up at the RBI's forthcoming board meeting on November 19.

Former Finance Minister P Chidambaram on Thursday, said, the spat between the government and the RBI was over a huge sum of money the government has demanded from the central bank.

The imposition of a never before used rule was meant to force the hand of RBI Governor Urjit Patel, to pay Rs. 1 lakh crore from the reserves of the Reserve Bank of India, who has refused to pay, he said. The Finance Minister further referring to the scheduled board meeting said, "Hope the Governor stands his ground," Mr. Chidambaram said, He also said that the government, is trying to step up expenditure in an election year despite facing a fiscal deficit.

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