06.07.2026

1. A sustained decline in the share of CASA deposits can increase the average cost of funds for banks and exert pressure on their Net Interest Margin (NIM).
2. Greater reliance on short-term wholesale funding instruments may expose banks to higher refinancing and liquidity risks.

III. A persistent shift of household savings from bank deposits to market-linked financial instruments may influence the transmission of the Reserve Bank of India's monetary policy.

Which of the following information/evidence support(s) the above statements?

1. Savings account deposits generally carry lower interest rates than term deposits, while current accounts usually do not earn interest, making CASA a relatively low-cost source of funds.
2. Certificates of Deposit (CDs) are short-term money market instruments that require periodic refinancing, making banks more vulnerable if market liquidity tightens or interest rates rise.
3. Increased participation of households in mutual funds, equities and other market-linked investment avenues can reduce the growth of traditional bank deposits, affecting banks' liability structure and response to policy rate changes.
4. Banks are statutorily prohibited from using CASA deposits for extending long-term loans such as housing loans.

Select the correct answer using the code given below:

Statement I: Birthright citizenship based purely on the principle of jus soli is not an immutable constitutional principle across democracies and may be modified through constitutional or statutory changes depending on a country's legal framework.

Statement II: India progressively restricted citizenship by birth through amendments to the Citizenship Act, 1955, by introducing conditions relating to the citizenship status of parents and the legal status of migrants.

Statement III: Even where a constitution expressly guarantees birthright citizenship, the executive can unilaterally redefine the constitutional meaning of citizenship through executive orders if immigration policy objectives require it.

Which of the following relationships among the above statements is/are correct?

1. Statement II provides an empirical illustration supporting the proposition stated in Statement I.
2. Statement III contradicts the constitutional approach implicit in Statement I.
3. Statements I and III together establish that executive power is sufficient to alter constitutionally guaranteed citizenship rights.

Options:

1. Peru lies just to the south of the Equator in South America.
2. Peru shares its western border with the Atlantic Ocean.
3. Lake Titicaca, shared by Peru and Bolivia, is the world's highest navigable lake.

Which of the statements given above is/are correct?