RBI's Latest Measures to Boost the Economy -


Let us look at each of these steps in detail:

    Extension of the realization period of export proceeds: Currently, the value of software and goods exports made is to be realized fully and sent to India within 9 months from the date of commencement of exports. To mitigate the problems caused by the Coronavirus to the economy, the RBI says that the realization period is increased to 15 months. Such a measure will help exporters get their receipts from affected countries easily, while offering more flexibility to clients abroad.

    Review of the WMA limits in the States and UTs: It is decided to increase the limit of WMA by 30% from the current limit. This is to help the state governments to get relief from the economic problems caused by the pandemic. It is in effect from yesterday, 1st April 2020 and is valid till September 30, 2020.

    Implementation of the CCyb (Countercyclical Capital Buffer): The CCyB was devised by the RBI in 2015, to be implemented or activated as and when the circumstances demand it. In this framework, the main indicator would be credit-to-GDP gap, along with other secondary indicators. As of now, the RBI has decided not to activate the CCyB. 

On 17 April, 2020, RBI Governor Shaktikanta Das  has once again come up with measures to curb the downfall of the economy.

He prefaced the address with IMF's projection that the global economy is expected to plunge into the worst recession since 'The Great Depression'; "Economic activity came to standstill during the lockdown," the RBI Governor added.

The measures include a cut of 25 basis points on the Reverse Repo Rate from 4% to 3.75%, with immediate effect (the Repo Rate stays the same). "Loans given by NBFCs to real estate companies to get similar benefit as given by scheduled commercial banks", "Banks not to make any further dividend payout in view of financial difficulties arising from Covid-19", he added.

An amount of Rs 50,000 crore has also been sanctioned to the following banks to enable them to meet sectoral credit needs:

    National Bank for Agriculture and Rural Development
    Small Industries Development Bank of India,
    and National Housing Bank

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