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 marked-related rates in auctions form a large component of internal debt.

Which of the above statements is/are correct?

[UPSC Civil Services Exam – 2022 Prelims]

(a) 1 only

(b) 2 only

(c) Both 1 and 2

(d) Neither 1 nor 2


Answer: (c)        

Explanation:

Household financial savings

  • It refers to currency, bank deposits, debt securities, mutual funds, pension funds, insurance, and investments in small savings schemes.
  • The total of these savings is referred to as gross household financial savings.
  • Once financial liabilities, including loans from banks, non-banking financial companies (NBFCs), and housing finance companies, are subtracted from gross savings, what remains is referred to as net household financial savings.
  • A share of household financial savings goes to government borrowings, as part of public accounts of India. It mainly consists of provident fund. Hence, Statement 1 is correct.

Dated Government Securities

  • It is government securities or bonds which are long-term, the tenor ranging from 5 years to 30 years.
  • These have a fixed or floating coupon (or interest rate) associated with them which are paid on the face value at fixed intervals.
  • The securities can be issued by both the centre and the state governments to mobilise funds.
  • The government issues these funds to finance a fiscal deficit.
  • Dated securities mean regular government bonds, whereas T-bills are considered separately.
  • Dated securities issued at market-related rates comprise a large share of internal debt. Hence, Statement 2 is correct.

 

Consider the following statements:                                                                   The Parliament of India can place a particular law in the Ninth Schedule of the Constitution of India. The validity of a law placed in the Ninth Schedule cannot be examined by any court and no judgement can be made on it. Which of the statements given above is/are correct?

Consider the following statements:                                               

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Consider the following statements:                                                         The Parliament of India can place a particular law in the Ninth Schedule of the Constitution of India. The validity of a law placed in the Ninth Schedule cannot be examined by any court and no judgement can be made on it. Which of the statements given above is/are correct?

Consider the following statements:                                               

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