Question

The RBI manages the public debt of the Central Government under which provision?

Q: Answer-The RBI manages the public debt of the Central Government under which provision?

Under Sections 20 and 21 of the Reserve Bank of India Act, the RBI is obliged to undertake the management of the public debt of the Union and the issue of new loans. It also manages State Government debt by agreement under Section 21A. As debt manager, the RBI handles the issue, servicing and repayment of government securities. This function helps the government raise funds while the RBI ensures orderly conditions in the government securities market.