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Consider the following statements regarding Development Finance Institutions (DFIs).
1. Development Finance Institutions provide risk capital for economic development projects on non-commercial basis.
2. In India, the first DFI was operationalised before Independence, with the setting up of the Industrial Finance Corporation (IFCI).
3. During the pre-liberalised era, India had DFIs that were primarily engaged in development of industry in the country.
Which of the above statements is/are correct?
  • a)
    2 only 
  • b)
    2, 3
  • c)
    1, 2 
  • d)
    1, 3 
Correct answer is option 'D'. Can you explain this answer?
Most Upvoted Answer
Consider the following statements regarding Development Finance Instit...
Analysis of Statements regarding Development Finance Institutions (DFIs)
To determine the correctness of the statements regarding Development Finance Institutions (DFIs), let's analyze each one:
Statement 1: DFIs provide risk capital for economic development projects on a non-commercial basis.
- DFIs typically provide risk capital but do so with the intention of achieving financial returns alongside developmental goals. While they may prioritize development, they do engage in commercial activities as well.
Statement 2: In India, the first DFI was operationalised before Independence, with the setting up of the Industrial Finance Corporation (IFCI).
- This statement is correct. The Industrial Finance Corporation of India (IFCI) was established in 1948, making it India's first DFI, and it indeed came into being before India gained independence in 1947.
Statement 3: During the pre-liberalised era, India had DFIs that were primarily engaged in the development of industry in the country.
- This statement is also correct. In the pre-liberalisation phase, DFIs played a crucial role in financing industrial projects and fostering industrial development in India.
Conclusion:
- Since Statement 1 is incorrect while Statements 2 and 3 are correct, the correct answer is option 'b', which includes Statements 2 and 3.
Thus, the correct option based on the analysis should be 'b) 2, 3'.
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Community Answer
Consider the following statements regarding Development Finance Instit...
A development finance institution (DFI) also known as a development bank is a financial institution that provides risk capital for economic development projects on non-commercial basis. During the pre-liberalised era, India had DFIs which were primarily engaged in development of industry in the country. In India, the first DFI was operationalised in 1948 with the setting up of the Industrial Finance Corporation (IFCI). Subsequently, the Industrial Credit and Investment Corporation of India (ICICI) was set up with the backing of the World Bank in 1955. The Industrial Development Bank of India (IDBI) came into existence in 1964 to promote long-term financing for infrastructure projects and industry.
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Consider the following statements regarding Development Finance Institutions (DFIs).1. Development Finance Institutions provide risk capital for economic development projects on non-commercial basis.2. In India, the first DFI was operationalised before Independence, with the setting up of the Industrial Finance Corporation (IFCI).3. During the pre-liberalised era, India had DFIs that were primarily engaged in development of industry in the country.Which of the above statements is/are correct?a)2 onlyb)2, 3c)1, 2d)1, 3Correct answer is option 'D'. Can you explain this answer?
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Consider the following statements regarding Development Finance Institutions (DFIs).1. Development Finance Institutions provide risk capital for economic development projects on non-commercial basis.2. In India, the first DFI was operationalised before Independence, with the setting up of the Industrial Finance Corporation (IFCI).3. During the pre-liberalised era, India had DFIs that were primarily engaged in development of industry in the country.Which of the above statements is/are correct?a)2 onlyb)2, 3c)1, 2d)1, 3Correct answer is option 'D'. Can you explain this answer? for UPSC 2024 is part of UPSC preparation. The Question and answers have been prepared according to the UPSC exam syllabus. Information about Consider the following statements regarding Development Finance Institutions (DFIs).1. Development Finance Institutions provide risk capital for economic development projects on non-commercial basis.2. In India, the first DFI was operationalised before Independence, with the setting up of the Industrial Finance Corporation (IFCI).3. During the pre-liberalised era, India had DFIs that were primarily engaged in development of industry in the country.Which of the above statements is/are correct?a)2 onlyb)2, 3c)1, 2d)1, 3Correct answer is option 'D'. Can you explain this answer? covers all topics & solutions for UPSC 2024 Exam. Find important definitions, questions, meanings, examples, exercises and tests below for Consider the following statements regarding Development Finance Institutions (DFIs).1. Development Finance Institutions provide risk capital for economic development projects on non-commercial basis.2. In India, the first DFI was operationalised before Independence, with the setting up of the Industrial Finance Corporation (IFCI).3. During the pre-liberalised era, India had DFIs that were primarily engaged in development of industry in the country.Which of the above statements is/are correct?a)2 onlyb)2, 3c)1, 2d)1, 3Correct answer is option 'D'. Can you explain this answer?.
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