Punjab Finance Minister Harpal Singh Cheema has urged the Centre to share the Reserve Bank of India’s record dividend payout with states, while cautioning that excessive extraction of the central bank’s reserves could weaken India’s long-term economic resilience.
Cheema’s remarks came after the Reserve Bank of India transferred nearly Rs 2.87 lakh crore to the Union government from its total income of around Rs 4 lakh crore, marking one of the highest dividend payouts in the RBI’s history.
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Calling the transfer “extraordinary”, Cheema said such windfall gains should not remain outside the divisible tax pool shared with states.
“If the Union government is facing economic pressures due to global uncertainties and supply shocks, the states are facing the same challenges,” he said, adding that the gains should be distributed “in the spirit of cooperative federalism and fiscal fairness”.
The Punjab finance minister also raised concerns over the impact of the payout on the RBI’s financial strength and institutional independence.
“While reducing the fiscal deficit is important, it must not come at the cost of weakening the financial strength and institutional firepower of the Reserve Bank of India,” Cheema said.
He described the RBI as the country’s “economic shock absorber and monetary stabiliser” during crises, warning that excessive reserve transfers could erode India’s long-term economic resilience and financial stability.
Cheema further said the central bank should maintain a stronger financial buffer at a time of global financial uncertainty and currency-related pressures.
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“The central bank must preserve adequate reserves and policy flexibility to safeguard financial stability,” he said.
Urging the RBI leadership to protect the institution’s autonomy, Cheema said India could not aspire to become a strong and resilient economy with a weakened central bank.
