RBI continues current arrangements for WMA

MUMBAI, APRIL 8. The Reserve Bank of India has said the ways and means advances (WMA) to the Centre, rate of interest and the minimum balance required to be maintained with the apex bank effective from April 1 will be the same as in the previous fiscal.

The limit for WMA in 2000-01 would continue at Rs. 11,000 crores for the first half of the year (April-September) and Rs. 7,000 crores for the second half (October-March), an RBI release said here.

When 75 per cent of the limit for WMA is utilised by the Government, the RBI may trigger fresh floatation of market loans depending on market conditions, it added. The interest rate on WMA would be at Bank Rate (seven per cent) and on overdraft at bank rate plus two percentage points. The minimum balance required to be maintained by the Centre with RBI will not be less than Rs. 100 crores on Friday's and not less than Rs. 10 crores on other days, it said.

As per the provisions of the agreement dated March 26, 1997, between the Centre and the RBI, overdrafts beyond ten consecutive working days would not be allowed.

- PTI

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