This question was directly taken from Economic survey.   It can be categorized as a medium-level question because the economic survey is an important source for the Economy related questions but still remembering all the detail of the economic survey is difficult.     Concept Discussed   Household financial savings   Public debt.   Dated securities and   In the end, I would discuss a rare question of UPSC.     Statement 1- A share of the household's financial savings goes towards government borrowings.     What is Household financial savings?   It refers to currency, bank deposits, debt securities,   mutual   funds,   pension funds,   insurance, and investments in small savings schemes by households.     As the government borrows through the issue of government securities called G-secs and Treasury Bills.   Banks, insurance companies, and mutual funds are key investors in government securities.  Hence statement 1 is correct.

  This question  was an easy question and deals with the Indirect transfer concept.   it was easy because it was in regular news due to a decision by the  Netherlands arbitration court in 2020-2021.   The court has ordered the  Indian government  to pay $1.2 billion [more than 8 thousand crores] to Cairn energy for tax harassment .   Due to this in 2021, the government came up with Taxation laws [Amendment], bill 2021.   What are Taxation laws [Amendment], bill 2021?   It was an amendment in taxation laws which was focused on ending the retrospective tax issue.   In short it says that   "if Indirect transfer of Indian asset occurred before May 28, 2012, then the Indian government will not demand taxes on it."   If Income tax authorities had collected any taxes from such companies then the Indian government will refund the money to the victim company [with 0% interest].   However, the company need to drop all the cases against the India

  This question can be solved even if you know the rule that Extreme statements are usually wrong.   Usually, if a statement has an extreme word like all, Must, Never, Every etc.   That statement is usually[not always]  wrong.   With reference to Ayushman Bharat Digital Mission, consider the following statements :   1. Private and public hospitals must adopt it.   2. As it aims to achieve universal health coverage, every citizen of India should be part of it ultimately.   3. It has seamless portability across the country.   Which of the statements given above is/are correct? (a)        1 and 2 only (b)        3 only (c)        1 and 3 only (d)        1, 2 and 3   Tip It is not compulsory to adopt.   Solution - B   What is Ayushman Bharat Digital Mission (ABDM) ?   ABDM is a part of the  Ayushman Bharat mission. it aims to develop the backbone necessary to support the integrated digital health infrastructure of the country. 

  This was a tough question because statement 2 uses the word Indexation which many aspirants were not able to understand.   With reference to Convertible Bonds , consider the following statements : [2022] 1.  As there is an option to exchange the bond for equity, Convertible Bonds pay a lower rate of interest . 2. The option to convert to equity affords the bondholder a degree of indexation to rising consumer prices. Which of the statements given above is/are correct? (a)        1 only (b)        2 only (c)        Both 1 and 2 (d)        Neither 1 nor 2     Solution: (c)   What are Convertible bonds?   They are hybrid securities that offer investors the best of both stocks and bonds .   Like any other kind of bond, they provide a guaranteed income stream and pay back the amount you originally lent the company.   Statement 1 - As there is an option to exchange the bond for equity, Convertible Bonds pay a lower rate of interest.   Convert

  This question on Credit rating agencies was a medium-level question because it can be done using the Elimination technique. Consider the following statements : 1.    In India,  credit rating agencies  are  regulated by  the Reserve Bank of India. 2.   The rating agency popularly known as  ICRA  is a public limited company. 3.    Brickwork Ratings  is an Indian credit rating agency. Which of the statements given above are correct? (a)        1 and 2 only (b)        2 and 3 only (c)        1 and 3 only (d)        1, 2 and 3   Tip All the credit rating agencies in India are regulated by SEBI.   Solution- “B”     What is a Credit rating Agencies[CRAs]?   A credit rating agency is a company that assigns credit ratings, which  rate a debtor's ability to pay back debt  by making timely principal and interest payments and the likelihood of default.  Wikipedia   CRAs were in news due to several reason   1. To address the issue of Shadow Banking SEBI tightened the Norms for CRAs.   What is

The question on Inflation Indexed bonds was Medium level question because it can be done using the elimination method. With reference to the Indian economy, what are the advantages of  “Inflation-Indexed Bonds (IIBs)” ? [2022] 1.  Government can reduce the coupon rates on its borrowing by way of IIBs. 2. IIBs provide protection to the investors from uncertainty regarding inflation. 3. The interest received as well as capital gains on IIBs are not taxable. Which of the statements given above are correct? (a) 1 and 2 only (b) 2 and 3 only (c) 1 and 3 only (d) 1, 2 and 3   TIP No tax exemptions given on  “Inflation-Indexed Bonds (IIBs)”   Solution - A     What is Inflation-Indexed Bond [IIB] ?   A bond is a type of security .   Inflation Indexed bonds interest rates are linked to the Inflation rate.   For e.g. - Inflation Indexed National Savings Securities-Cumulative (IINSS-C) with Interest Rate = CPI + 1.5%   Why do we need IIB?