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.
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.