Stellar growth: RBI's balance sheet is now 2.5 times the size of Pakistan's GDP
The central bank's income rose by 17.04 per cent in FY24, while expenditure significantly decreased by 56.30 per cent.
The Reserve Bank of India (RBI) recently released its annual report, highlighting a significant increase in its balance sheet size and a positive outlook for the Indian economy.
Balance Sheet Expansion:
The RBI's balance sheet grew by 11.08 per cent to a substantial Rs 70.48 lakh crore (USD 844.76 billion) as of March 31, 2024. This is nearly 2.5 times the size of Pakistan's entire GDP. This growth signifies a return to pre-pandemic levels and represents 24.1 per cent of India's GDP.
The central bank's income rose by 17.04 per cent in FY24, while expenditure significantly decreased by 56.30 per cent. This resulted in a substantial 141.23 per cent increase in surplus to Rs 2.11 lakh crore, which was transferred to the government. Additionally, Rs 42,820 crore was allocated towards the contingency fund in FY24.
Economic Optimism:
The RBI report expresses optimism regarding the Indian economy's future, supported by strengthening macroeconomic fundamentals. The government's focus on infrastructure spending (capex) and fiscal consolidation, alongside consumer and business confidence, are seen as positive signs for investment and consumption demand. The RBI forecasts a robust real GDP growth of around 7 per cent for FY25.
Growth Trajectory and Stability:
The report suggests that India is well-positioned for an accelerated growth trajectory over the next decade, driven by macroeconomic and financial stability. Easing inflation is expected to boost consumption demand, particularly in rural areas. India's strong external sector and forex reserves will provide a buffer against external economic shocks. Overall, the RBI report paints a positive picture of the Indian economy, with a robust financial system and promising growth prospects.
Disclaimer: The article is for informational purposes only and not investment advice.