Which of the following statements are true in context of Development Financial Institutions (DFls) in few years after economic reforms in 1991? 1. DFls such ICICI, IDBI and IFCI had a huge pile of bad loans. 2. DFls no longer had access to low-cost long-term funds from the government or the central bank to finance large infrastructure projects. They were forced to borrow at higher rates from the market. 3. Banks began financing infrastructure projects, that was actually out of their mandate. 4. RBI established a committee under S. H. Khan for transition of DFIs into universal banks. 5. ICICI Bank and IDBI went for reverse merger in a quest to create Universal Banks.

The correct answer is: D. 1, 2, 3, 4 and 5

Here is a brief explanation of each statement:

1. DFls such ICICI, IDBI and IFCI had a huge pile of bad loans.

This is true. In the early 1990s, DFIs were saddled with a large number of non-performing assets (NPAs). This was due to a number of factors, including the economic slowdown of the late 1980s, the Gulf War, and the liberalization of the Indian economy.

1. DFls no longer had access to low-cost long-term funds from the government or the central bank to finance large infrastructure projects. They were forced to borrow at higher rates from the market.

This is also true. Prior to the economic reforms, DFIs were able to borrow at low rates from the government or the central bank. However, after the reforms, they were forced to borrow at higher rates from the market. This made it difficult for them to finance large infrastructure projects.

1. Banks began financing infrastructure projects, that was actually out of their mandate.

This is also true. After the economic reforms, banks were allowed to finance infrastructure projects. This was because the government wanted to increase private sector participation in infrastructure development.

1. RBI established a committee under S. H. Khan for transition of DFIs into universal banks.

This is also true. In 1998, the RBI established a committee under S. H. Khan to look into the issue of DFIs. The committee recommended that DFIs be converted into universal banks.

1. ICICI Bank and IDBI went for reverse merger in a quest to create Universal Banks.

This is also true. In 2001, ICICI Bank and IDBI Bank merged to form ICICI Bank Limited. This was the first reverse merger in India.

The economic reforms of 1991 had a significant impact on DFIs. They were no longer able to rely on low-cost long-term funds from the government or the central bank. They were also forced to compete with banks for financing infrastructure projects. In order to survive, DFIs had to either merge with banks or convert themselves into universal banks.