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RBI may pay dividend to govt on Wed

The Reserve Bank of India is likely to pay an annual dividend of about Rs 102 billion to the Union government on August 14, a senior banker told Reuters on Monday.

"The Reserve Bank of India's board is meeting on Wednesday. The board traditionally meets around this time of year to approve the central bank's accounts," said the source, who declined to be identified.

"The transfer of dividend to the government is usually made on the same day."

Last month, RBI Governor Bimal Jalan had said the bank would pay its dividend by mid-August.

Finance ministry officials have already said that the dividend payment would improve the government's cash flows.

Analysts say the inflows into the government's coffers would bring down its short-term balances with the central bank under the ways and means advances facility.

Data released at the weekend showed short-term advances by the central bank to the Union government stood at Rs 132.81 billion for the week ended August 2, compared with Rs 81.96 billion in the previous week.

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