Questions and Answers
What is the primary role of the Reserve Bank of India in the government bond market?
Which act mandates the Reserve Bank of India to manage the Central Government's public debt?
In addition to managing public debt, what other significant mandate does the Reserve Bank of India have?
How has the Government Securities Act, 2006 impacted the Reserve Bank of India's role?
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What dual role does the Reserve Bank of India fulfill in relation to the government?
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Study Notes
Reserve Bank of India (RBI) Overview
- The Reserve Bank of India serves as the primary regulator of the Indian government bond market, establishing its crucial role by statute and design.
- As the primary banker to the Government, the RBI oversees the management of debt for the central government, ensuring proper handling of public financial obligations.
Functions of RBI
- The RBI holds the mandate to implement and manage the monetary policy of India, influencing economic conditions through interest rates and liquidity mechanisms.
- It is legally compelled to manage the Central Government’s public debt under the RBI Act of 1934, which outlines its responsibilities and powers.
Legislative Support
- The Government Securities Act of 2006 bolsters the RBI's role in debt management, providing a framework for the issuance and trading of government securities, enhancing market stability.
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Description
This quiz explores the role of the Reserve Bank of India as a primary regulator of the Indian government bond market. It covers the RBI's responsibilities in managing public debt and conducting monetary policy as mandated by the RBI Act 1934 and the Government Securities Act 2006.
