BANKING AFFAIRS

Detailed explanation-1: -What is cross-border exchange? Answer: [D] The trading of the Indian rupee in exchange for other currencies/ goods. Notes: Cross-border trade (CBT) is the exchange of goods or services between two countries. It is the trading of the Indian rupee in exchange for other currencies/ goods.

Detailed explanation-2: -Cross-border information exchange means the process of sending and receiving information across legislative boundaries using interoperable systems in order to read and further process this information in a meaningful way.

Detailed explanation-3: -India’s foreign exchange reserves are mainly composed of US dollar in the forms of US government bonds and institutional bonds. with nearly 7.34% of forex reserves in gold. The FCAs also include investments in US Treasury bonds, bonds of other selected governments and deposits with foreign central and commercial banks.

Detailed explanation-4: -The Reserve Bank of India, is the custodian of the country’s foreign exchange reserves and is vested with the responsibility of managing their investment. The legal provisions governing management of foreign exchange reserves are laid down in the Reserve Bank of India Act, 1934.

Detailed explanation-5: -Foreign exchange refers to exchanging the currency of one country for another at prevailing exchange rates. Let us take a close look at the meaning of foreign exchange. Different countries have different currencies. Foreign exchange converts the currency of one country into another.