Consider the following statements regarding Development Financial Institutions (DFIs) and credit rating agencies in India: Statement 1: DFIs were established post-independence to provide long-term finance to industrial and infrastructure sectors where the gestation period was long and risks were high. Statement 2: The Industrial Credit and Investment Corporation of India (ICICI), as a prominent DFI, promoted the Credit Rating Information Services of India Limited (CRISIL) in 1987 as India's first credit rating agency. Statement 3: CRISIL operates as a statutory body under the Ministry of Finance, and its ratings are mandatory for all government-funded projects. Statement 4: The conversion of DFIs like ICICI (2002) and IDBI (2004) into universal commercial banks was driven by the need to access low-cost retail deposits. Which of the following represents the most accurate evaluation of these statements?

Question

Economics · Financial Institutions

Verified Solution4 OptionsUpdated: October 2026👁️1 View

Correct answer

Statements 1, 2, and 4 are accurate; Statement 3 is incorrect because CRISIL is a public limited commercial company majority-owned by S&P Global.

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Answer 1

Statements 1, 2, and 4 are accurate; Statement 3 is incorrect because CRISIL is a public limited commercial company majority-owned by S&P Global.

Answer 2

Statements 2 and 3 are correct; Statement 4 is false as ICICI still operates solely as a DFI under the name NaBFID.

Answer 3

All statements are correct, reflecting total government statutory control over credit rating agencies.

Answer 4

Only Statement 1 is correct, as Statement 2 misidentifies the year CRISIL was founded as 1997 instead of 1987.

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