Consider the following statements :
- 1. The Reserve Bank of India manages and services Government of India Securities but not any State Government Securities.
- 2. Treasury bills are issued by the Government of India and there are no treasury bills issued by the State Governments.
- 3. Treasury bills offer are issued at a discount from the par value.
Which of the statements given above is/are correct ?
1 and 2 only
3 only
2 and 3 only
1, 2 and 3
Answer is Right!
Answer is Wrong!
This question was previously asked in
UPSC IAS – 2018
2. Treasury Bills (T-Bills) are short-term money market instruments. In India, T-Bills are issued *only* by the Central Government to meet its short-term funding requirements. State Governments do not issue T-Bills; they raise market borrowings through SDLs. Statement 2 is correct.
3. Treasury Bills are zero-coupon securities, meaning they do not pay interest. They are issued at a discount to their face value (par value) and redeemed at the par value on maturity. The return to the investor is the difference between the maturity value and the issue price (the discount). Statement 3 is correct.
Therefore, statements 2 and 3 are correct.