Class 12 Finance Chapter 4 Role of the RBI in the Economic Development of India 

Class 12 Finance Chapter 4 Role of the RBI in the Economic Development of India Solutions English Medium As Per AHSEC New Syllabus to each chapter is provided in the list so that you can easily browse through different chapters ASSEB Class 12 Finance Chapter 4 Role of the RBI in the Economic Development of India Solutions in English and select need one. AHSEC Class 12 Finance Solutions Download PDF. HS 2nd Year Finance Textual Solutions.

Class 12 Finance Chapter 4 Role of the RBI in the Economic Development of India

Also, you can read the NCERT book online in these sections Solutions by Expert Teachers as per Central Board of Secondary Education (CBSE) Book guidelines. ASSEB Class 12 Banking Question Answer are part of All Subject Solutions. Here we have given HS 2nd Year Finance Textual Solutions English Medium for All Chapters, You can practice these here.

Role of the RBI in the Economic Development of India 

Chapter: 4

Unit – 1: FINANCIAL INSTITUTIONS

A. Very Short Questions Answer:

1. In which year was the IDBI established?

Ans: The Industrial Development Bank of India (IDBI) was established in 1964.

2. In which year was the Credit Guarantee Corporation of India Ltd. established?

Ans: The Credit Guarantee Corporation of India Ltd. was established in 1971.

3. In which year were the RRBs established?

Ans: The Regional Rural Banks (RRBs) were established in 1975.

4. In which year was the Agriculture Refinance and Development Corporation established?

Ans: The Agricultural Refinance and Development Corporation (ARDC) was established in 1963.

B. Short Answer Questions.

1. Write two names of priority sectors.

Ans: (i) Agriculture.

(ii) Small Scale Industries (SSI).

2. Write two financing facilities provided by the RBI to the cooperative sector.

Ans: (i) Short-term finance for agricultural operations.

(ii) Medium-term and long-term finance for agricultural and rural development.

C. Long Answer Questions (Type-I): 

1. Explain the promotional role of the RBI.

Ans: The Reserve Bank of India (RBI) plays an important promotional role in the economic development of the country. Its main promotional functions are:

(i) The RBI promotes agricultural and rural credit.

(ii) It provides financial assistance to cooperative banks and Regional Rural Banks (RRBs).

(iii) It promotes the development of small-scale industries and other priority sectors.

(iv) It encourages the growth of financial institutions and a sound banking system.

(v) It supports financial inclusion by extending banking facilities to rural and backward areas.

(vi) It helps in the overall economic development of the country through various developmental programmes.

D. Long Answer Questions (Type-II): 

1. Discuss the role of the RBI in the field of industrial finance.

Ans: The Reserve Bank of India plays an important role in promoting industrial development in India through various measures.

(i) It established the Industrial Development Bank of India (IDBI) to provide financial assistance to industries.

(ii) It provides refinance facilities to banks and financial institutions for industrial loans.

(iii) It promotes the development of small-scale and medium-scale industries.

(iv) It encourages the flow of credit to priority industries.

(v) It formulates policies to ensure adequate industrial finance.

(vi) It supports industrial growth by maintaining monetary and financial stability.

(vii) It coordinates with financial institutions for industrial development.

(viii) It promotes balanced industrial growth in different regions of the country.

2. Discuss the role of the RBI in the field of agricultural finance.

Ans: The Reserve Bank of India plays a vital role in the development of agriculture by providing financial support and promoting rural credit.

(i) It provides refinance facilities to cooperative banks for agricultural lending.

(ii) It helped establish the Agricultural Refinance and Development Corporation (ARDC) and later supported NABARD for agricultural and rural development.

(iii) It promotes agricultural and rural credit through various schemes.

(iv) It provides financial assistance to Regional Rural Banks (RRBs).

(v) It encourages banks to provide adequate credit to farmers and the agricultural sector.

(vi) It supports irrigation, rural infrastructure, and agricultural development projects.

(vii) It gives priority to agriculture under the Priority Sector Lending Programme.

(viii) It helps improve the overall rural economy by ensuring the availability of institutional credit.