Consider the following statements: 1) The Reserve Bank of India manages and services Government of India Securities but not any State Government Securities. 2) Treasury bills are issued by the Government of India and there are no treasury bills issued by the State Governments. 3) Treasury bills offer are issued at a discount from the par value. Which of the statements given above is/are correct?

Statements 2 and 3 are correct, so the answer is C. Statement 1 is false.

• Statement 1 is wrong. RBI manages and services Government of India securities, and it also acts as agent for State Governments in issuing and servicing State Development Loans (State Government Securities). The 'but not any State Government Securities' part is the error.
• Statement 2 is correct. Treasury bills are short-term instruments (91, 182 and 364 days) issued only by the Union Government. State Governments cannot issue T-bills. They borrow through SDLs and market borrowings.
• Statement 3 is correct. T-bills are zero-coupon instruments. They are issued at a discount to face (par) value, and the investor receives the par value at maturity. The difference is the return.

The core concept is the government's domestic debt market: who issues what, and how RBI works as the government's debt manager. This ties to Mains questions on public debt management and the role of RBI.

Trap: Aspirants often assume RBI services only central government paper. Remember RBI also handles State Government securities as agent.