India’s c. bank net income soars 141%

The Reserve Bank of India (RBI) reported a 141 per cent increase in net income for the financial year ending March 2024, Reuters reported on Thursday.

The surge, amounting at 2.11 trillion rupees ($25.30 billion), was driven primarily by a sharp decrease in expenses, allowing the central bank to transfer a record surplus to the government.

The RBI’s total expenditure for the year decreased by 56.30 per cent to 646.94 billion rupees from 1.48 trillion rupees in the previous year. The drop in provisions was due to strong risk buffers and revaluation gains on foreign securities resulting from the rupee’s depreciation, said Gaura Sen Gupta, chief economist at IDFC First Bank.

Overall income from foreign sources increased by 23.23 per cent to 1.87 trillion rupees, up from 1.52 trillion rupees the previous year. This growth was fuelled by a combination of factors, including:

• The RBI reported a gain of 836.16 billion rupees from foreign exchange transactions during the year.
• Interest income from foreign securities rose to 653.28 billion rupees, partly due to higher interest rates implemented by central banks globally.

The RBI is optimistic about India’s economic growth, citing strong investment demand. It also anticipates inflation easing towards the four per cent target, potentially boosting consumption in rural areas.