Consider the following statements with reference to ‘IFC Masala Bonds’ - 1. The International Finance Corporation, which offers these bonds, is an arm of the World Bank. 2. They are the rupee-denominated bonds and are a source of debt financing for the public and private sector. Select the correct answer using the code given below.

QUESTION

Medium

Economy

Prelims 2016

Consider the following statements with reference to ‘IFC Masala Bonds’ -

The International Finance Corporation, which offers these bonds, is an arm of the World Bank.
They are the rupee-denominated bonds and are a source of debt financing for the public and private sector.

Select the correct answer using the code given below.

Select an option to attempt

Explanation

Statement 1 is Correct. The International Finance Corporation (IFC) is indeed an arm of the World Bank Group, a group of five international organizations that work together to fight poverty and promote sustainable development. The IFC specifically focuses on encouraging growth in the private sector of developing countries.

Statement 2 is Correct. Masala bonds are rupee-denominated bonds issued by foreign entities (public or private sector) outside of India. These bonds raise capital for the issuer in Indian rupees, providing an alternative funding source.

Therefore, the correct answer is 1 and 2 both are correct.

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