Discuss the various types of Government securities that are issued by the RBI.
Government securities are referred to as 'gilt-edged securities', as they are absolutely secured RBI, being
the banker to the Government, issues different types of paper on belhalf of the latter, to cater various requirement.
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The RBI is the Reserve Bank of India, India's central bank. It issues government securities as a way of borrowing money to be used by the government. As you say, these debt instruments carry a sovereign guarantee and are therefore seen as absolutely secure.
There are many types of government securities issued by RBI:
- Dated securities with a fixed maturity date
- Zero coupon bonds
- Partly paid stock
- Floating rate bonds
- Capital indexed bonds
There is not space to discuss these at any length here. Please follow the links for more information.
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