Question

Who declares the "Credit Policy" of India?

• A. The Finance Ministry
• B. Reserve Bank of India
• C. The Commerce Ministry
• D. The Indian Bank's Association

Hint:

Think of the body that acts as India's central bank.

Answer 1

The Correct Option is B

This question checks a basic fact about India's monetary system.

1. The Finance Ministry: it handles the government budget and fiscal policy, not the credit policy.
2. Reserve Bank of India: as the central bank, it sets and announces the credit policy, covering interest rates and money supply.
3. The Commerce Ministry: this deals with trade and industry matters, unrelated to credit policy.
4. The Indian Bank's Association: this is an industry body for banks, it does not declare national credit policy.

So Reserve Bank of India is correct, since credit policy falls squarely under its central banking role.

Let's summarize:

• The RBI reviews and announces the credit policy periodically to manage inflation, liquidity, and growth.

This is a core function tested often in banking and finance general knowledge.