Four Statements, One Regulator Too Many

Correct count: 3 (statements I, II and III).

• (I) Correct. SEBI was created in 1988 as an administrative, non-statutory body and was given statutory status by the SEBI Act, 1992, which also codified its powers over the securities market.
• (II) Correct. The Insurance Regulatory and Development Authority was constituted in 1999 under the IRDA Act, 1999, and is headquartered in Hyderabad. It was renamed IRDAI (adding 'India') in 2014–15, which does not affect the truth of the statement.
• (III) Correct. NABARD was established in 1982 on the recommendation of the Sivaraman Committee as the apex institution for agricultural and rural credit, refinancing rural cooperative banks and regional rural banks.
• (IV) Incorrect, on two independent grounds. First, the year: the RBI was nationalised on 1 January 1949; 1969 is the year 14 major commercial banks were nationalised, a different event altogether. Second, the mandate: the RBI supervises banking and monetary policy, but insurance is regulated by IRDAI. One false statement inside a compound claim is enough to sink the claim.

So three statements are correct and the answer is option 3. Because there is no negative marking, the count is worth guessing even if one statement is uncertain - but only after eliminating what can be eliminated.

Reject statement (IV) on the ground Karan can settle: who regulates insurance.

Statement (II) and statement (IV) make mutually exclusive claims. (II) puts insurance supervision with IRDAI; (IV) puts it with the RBI. India does not have two insurance regulators - the sector has a single statutory regulator - so at most one of (II) and (IV) can be true.

Karan is confident that (II) is right. That forces (IV) to be false on the regulatory ground alone, without ever reaching the date. And once one limb of (IV) fails, the entire statement fails.

With (IV) eliminated, the count follows mechanically: (I), (II) and (III) remain, so the answer is 3 - exactly the option Karan would have reached had he remembered 1949.

The general technique for 'how many are correct' items is to hunt for the pair of statements that cannot both stand, or the single statement whose falsehood rests on a fact you know cold. This converts a four-way recall problem into a one-decision problem. Karan's second lesson is narrower but sharper: 1969 belongs to bank nationalisation, 1949 to the RBI - two dates that examiners pair precisely because candidates conflate them, so a confident 'I am sure' is worth re-checking.

The argument confuses two different functions and is wrong; statement (III) stands.

The RBI is the country's central bank: monetary policy, currency, regulation and supervision of banks, and the lender of last resort. It does not itself deliver agricultural credit.

NABARD is a development and refinance institution, not a regulator of the monetary system. Its mandate is to build rural credit infrastructure: it refinances state cooperative banks and regional rural banks, supervises regional rural banks and cooperative banks in coordination with the RBI, and runs funds for rural infrastructure and farm-sector development. Being 'apex' in rural credit does not put it in competition with the RBI - it sits at the top of a different channel.

The friend's error is a classic category slip: 'credit' is not one thing. Agricultural credit is a purpose, banking supervision is a regulatory function, and the two are handled by different bodies. In GK items, whenever an option asserts that one well-known institution performs another well-known institution's core job, treat it as a red flag and check whether the two mandates genuinely overlap or only sound as though they should.