Under the minimum reserve system of currency issue, the Reserve Bank of India must maintain assets of at least what total value?

Introduction / Context:
This question falls under the topic of Indian banking and monetary system. It specifically refers to the minimum reserve system used by the Reserve Bank of India for issuing currency notes. Earlier, India followed other systems such as the proportional reserve system. Understanding the amount and composition of minimum reserves is a common factual point in banking awareness.

Given Data / Assumptions:

• The question is about the minimum reserve system for the issue of bank notes.
• It asks for the minimum total value of assets to be maintained by the RBI.
• Options include different rupee amounts in crore units.

Concept / Approach:
Under the minimum reserve system, the Reserve Bank of India is required to maintain a minimum amount of assets consisting of gold and foreign securities plus rupee securities. The key fact to remember is that the total minimum value of these assets should not be less than 200 crore rupees, of which at least 115 crore rupees must be in gold. This allows flexibility in note issue while ensuring basic backing of the currency.

Step-by-Step Solution:
Step 1: Recall that the minimum reserve system replaced the earlier proportional reserve system.Step 2: Under this system, a fixed minimum amount of assets must be maintained, not a fixed ratio to the notes issued.Step 3: The critical figure for total assets under this system is 200 crore rupees.Step 4: Out of this, 115 crore rupees must be held in the form of gold bullion and gold coin.Step 5: Therefore, the correct answer for the minimum total assets requirement is 200 crore rupees.

Verification / Alternative Check:
When revising, it helps to memorise the pair of numbers together: 200 crore rupees total and 115 crore rupees in gold. Any option that does not match the total of 200 crore rupees can then be eliminated quickly in the exam. Since 85 and 115 crore rupees clearly fall short of the total requirement, and 210 or 250 crore rupees have never been part of the standard requirement, 200 crore rupees stands out as the correct value.

Why Other Options Are Wrong:
85 crore rupees and 115 crore rupees are only parts of the composition, with 115 crore rupees referring specifically to the gold component, not to the total assets. 210 crore rupees and 250 crore rupees are not mentioned in the legal provisions governing the minimum reserve system and thus do not represent the statutory minimum. They are therefore incorrect in the context of this question.

Common Pitfalls:
Many learners confuse the minimum total assets requirement with the gold portion and wrongly choose 115 crore rupees. Another issue is mixing up older and newer systems of note issue, such as the proportional reserve system, where the backing was expressed as a percentage of notes issued. To avoid errors, always link the phrase \"minimum reserve system\" with the pair 200 crore rupees total and 115 crore rupees in gold.

Final Answer:
Under the minimum reserve system of currency issue, the Reserve Bank of India must maintain assets worth at least 200 crore rupees in total.