The Reserve Bank of India's surplus transfers offer the government much-needed fiscal space, yet they are not without challenges. Critically examine the implications of the RBI's surplus transfers to the government. (Answer in 150 words)

RBI is the fiscal and monetary watchdog institution of India. It was created under the RBI Act, 1934, and is responsible to maintain fiscal growth and development. Implications of RBI's surplus transfers: I. Positives: (1) Provides resources to government to boost cleaner activities: By: PM- Grath Shakti, National Homebuilder Pipeline (2) Reduces recurring cut effect for private sector: By: Banks would offer more to private sector. (3) Maintains economic growth rate: By: In FY 2024-25, India's growth rate

CISA @ 2% (4) Ensures 2040-economic growth and reshubalance of major February: By: PM-Tan Average Yojana, PM-Kisan. Negatives: (1) Leads to inflation in the economy: By: Government may spend on unproductive sector. (2) Hampers sustainable fiscal consolidation and equilibrium: By: Against the spirit of FRBM Act, 2003 (3) Surplus may be used for hedging against external shock: By: India's present force stands at more than 630 bn. (4) Invites hidden burden for government: By: Government may go for fetisher lending through deficit financing. RBI's surplus transfers should be based on the principle of 5E's: effective, equitable and efficient