With reference to the Indian economy, consider the following statements:
- 1. A share of the household financial savings goes towards government borrowings.
- 2. Dated securities issued at market-related rates in auctions form a large component of internal debt.
Which of the above statements is/are correct?
[amp_mcq option1=”1 only” option2=”2 only” option3=”Both 1 and 2″ option4=”Neither 1 nor 2″ correct=”option3″]
This question was previously asked in
UPSC IAS – 2022
Statement 2 is correct. The Indian government’s internal debt consists mainly of market borrowings (through the issuance of dated securities and treasury bills), as well as funds raised through small savings schemes and state provident funds. Dated securities, issued through auctions at market-related rates, form the largest component of the central government’s internal debt.