With reference to the Indian economy, consider the following statements:

1. A share of the household financial savings goes towards government borrowings.
2. Dated securities issued at market-related rates in auctions form a large component of internal debt. Which of the above statements is/are correct?

This question pertains to household financial savings and central government debt in India.

Household financial savings encompass currency, bank deposits, debt securities, and investments.

Central government debt includes liabilities contracted against the Consolidated Fund of India.

Statement 1: Correct. A portion of household financial savings is indeed directed towards government borrowings. Adverse changes in household savings patterns can impact key investors in government securities.

Statement 2: Correct. Dated securities and Treasury bills are issued through auctions at market-related rates as per a pre-notified schedule. These securities form a significant part of the internal debt.

Both statements are correct.

Hence, option C is the correct answer.