Full Form of CGB

What is CGB?

A Central Government Bond (CGB) is a debt security issued by the Reserve Bank of India (RBI) on behalf of the Government of India to raise funds from the public and institutional investors. These bonds are a key component of the Indian government securities (G-Sec) market, which forms the backbone of the country's debt capital market. CGBs are typically long-term instruments with maturities ranging from 5 to 40 years, and they carry a fixed or floating coupon rate. The government uses the proceeds to finance infrastructure projects, social welfare programs, and fiscal deficits. In India, CGBs are considered one of the safest investment options because they carry sovereign guarantee, making them highly attractive for banks, insurance companies, provident funds, and retail investors. The RBI conducts regular auctions to issue new CGBs, and their yields are closely watched as a benchmark for other interest rates in the economy. For students preparing for UPSC, RBI Grade B, and NABARD exams, understanding CGBs is important because questions often appear on government borrowing, fiscal policy, and monetary transmission. The secondary market for CGBs is highly liquid, and trading occurs on platforms like NDS-OM. Overall, Central Government Bonds play a critical role in India's financial system by providing a risk-free rate and enabling the government to meet its funding needs efficiently.

CGB का फुल फॉर्म

Example

The RBI announced the auction of a new 10-year Central Government Bond (CGB) with a coupon of 6.79%, attracting strong demand from institutional investors.

CGB — frequently asked questions

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