Q5 · UPSC current affairs · 13 September 2026 · News · RBI Sovereign Bond Auction Partial Cancellation Yield Management

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Consider the following statements regarding government securities auctions and Primary Dealers:1.Primary Dealers are registered entities obligated to bid in government securities auctions.2.Devolment refers to the process where the Reserve Bank of India permanently cancels auctions without any dealer participation.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

Correct answer: (a) 1 only

Explanation

Statement 1 is correct as Primary Dealers have an obligation to bid in government securities auctions. Statement 2 is incorrect because devolment refers to Primary Dealers purchasing unsold government securities when market demand falls short, not a permanent cancellation without dealer participation.

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