Question

In the context of the Indian economy, non-financial debt includes which of the following?

1. Housing loans owed by households

2. Amounts outstanding on credit cards

3. Treasury bills

Select the correct answer using the code given below:

(a) 1 only

(b) 1 and 2 only

(c) 3 only

(d) 1, 2 and 3

Answer 1

Correct option is (d) 1, 2 and 3

"Non-Financial debt" excludes the debt of Financial Institutions i.e. those institutions that borrow solely to re-lend and the money. [In other words if, NABARD, ILFS etc had borrowed money to re-lend it, then it'd be financial debt. And all other type of debt will be "non- Financial debt"]

So, In above options, all three loans are taken by persons or entities who'll not 're-lend' it, but They will use the funds for their own purpose.