India's Gold Standard
The hottest stock in the financial sector is the Reserve Bank of India, India’s Central Bank. The RBI clocked in an income of Rs 36,180 crore last year and passed on Rs 15,009 crore to the Government, its owner. RBI’s balance sheet numbers are not a secret but it’s possible you've missed it. |
RBI's expenditure between 2010 to 2011 was Rs 8,655 crores. And then there is Gold. The Reserve Bank books gains and losses on valuation of foreign currency assets and gold under a balance sheet head called Currency & Gold Revaluation Reserve (CGRA). So, in 2010-11, there was an increase of Rs 63,152 crore ($14 billion) in value thanks to an increase in the value of gold and appreciation of other currencies against the US Dollar.
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Can the RBI be owned privately? Perhaps this is not feasible in India but as an illustration, the Swiss National Bank, the central bank of Switzerland is 55% owned by public institutions while the remaining 45% are traded in the stock market. The SNB is obliged by the Swiss Constitution to keep the interests of the country ahead of all, just a thought for our investment banking friends. |
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