Forex gains, interest income from foreign securities helped RBI transfer higher surplus to Centre

Reserve Bank of India

Higher income from foreign exchange transactions and interest income from foreign securities helped the Reserve Bank of India (RBI) declare record surplus transfer to the government for financial year 2024-25.

According to the RBI Annual Report 2024-25, the central bank’s exchange gain/loss from foreign exchange transactions increased by 33 percent on year during FY25 to Rs 1.11 lakh crore. Similarly, interest income from foreign securities for the central bank surged around 49 percent to Rs 97,006.66 crore in FY25.

Both these components helped the central bank report a surge in net income by 27 percent to Rs 2.69 lakh crore in FY25. RBI’s balance sheet for FY25 expanded by 8.20 percent year-on-year, reaching Rs 76.25 lakh crore as of March 31, 2025.

The RBI’s balance sheet essentially gives us an idea of its activities related to currency issuance, monetary policy, and reserve management.

On May 23, the RBI Central Board has approved the transfer of Rs 2.69 lakh crore as surplus to the government for the financial year 2024-25. This figure was higher than the transfer for FY24, though lower than some of the market estimates for FY25.

This is likely the highest ever annual surplus transfer to the government by the central bank. "The Board thereafter approved the transfer of Rs 2.68 lakh crore as surplus to the Central Government for the accounting year 2024-25," RBI said in a release.

On May 7, Moneycontrol had reported that the RBI may transfer around Rs 2.5-3 lakh crore as dividend transfer to the government, sharply higher than what the central bank transferred last year, on account of profits made from its intervention in currency markets to stem the decline in the rupee in FY25.

Every year, the RBI makes an annual payout to the government from the surplus income it earns on investments and valuation changes on its dollar holdings, and the fees it gets from printing currency.