UPSC CSE Prelims 2004

Correct Option

Both statements are incorrect.

• Statement 1 is incorrect. The Reserve Bank of India (RBI) was established on April 1, 1935, as a private shareholders' bank. It was nationalized on January 1, 1949, not on January 26, 1950.
• Statement 2 is incorrect. The borrowing programme of the Government of India (both Central and State governments) is managed by the Reserve Bank of India (RBI). The RBI acts as the public debt manager for the government, handling functions such as issuing government securities, managing their maturity profile, and conducting auctions. The Department of Expenditure, Ministry of Finance, is responsible for managing government expenditure, not its borrowing programme.

Incorrect Options

• Option (a) is incorrect because Statement 1 provides an inaccurate date for the nationalization of the RBI.
• Option (b) is incorrect because Statement 2 incorrectly attributes the management of the Government of India's borrowing programme to the Department of Expenditure instead of the RBI.
• Option (c) is incorrect because both Statement 1 and Statement 2 are factually inaccurate.