With reference to India, consider the following statements : 1. Retail investors through demat account can invest in 'Treasury Bills' and 'Government of India Debt Bonds' in primary market. 2. The 'Negotiated Dealing System-Order Matching' is a government securities trading platform of the Reserve Bank of India. 3. The 'Central Depository Services Ltd.' is jointly promoted by the Reserve Bank of India and the Bombay Stock Exchange. Which of the statements given above is/are correct?
- (a) 1 only
- (b) 1 and 2 ✓ UPSC's answer
- (c) 3 only
- (d) 2 and 3
Why the answer is (b)
• Statement 1 is correct: retail investors can bid non-competitively in primary auctions of T-bills and G-secs through demat/broker or the RBI Retail Direct route.
• Statement 2 is correct: NDS-OM is the RBI's electronic, anonymous order-matching platform for secondary trading in government securities.
• Statement 3 is wrong: Central Depository Services Ltd. (CDSL) was promoted by the Bombay Stock Exchange with banks such as SBI and Bank of India, not by the RBI.
• India's two depositories are NSDL (promoted by NSE, IDBI, UTI) and CDSL.
• Hence 1 and 2, option (b).
Why the other options are wrong
- (a) 1 only
- Statement 2 on NDS-OM is also correct.
- (c) 3 only
- Statement 3 is wrong: the RBI did not promote CDSL.
- (d) 2 and 3
- Statement 3 is wrong; statement 1 is correct.
Asked in the GS Paper I of the UPSC Civil Services Preliminary Examination 2021, held on 10 October 2021. Question and answer key: Union Public Service Commission. Explanation: UPSC Answer Check.