Governments raise / borrow funds by issuing government securities to finance a variety of projects and activities. What is Government Security (G-Sec)? Government Security (G-Sec) is a tradeable instrument issued by the Central Government or the State Governments. G-Secs carry practically no risk of default and, hence, are called risk-free gilt-edged instruments. What are the types of G-Secs? Government security Term Issued by Treasury Bills (T-bills) Short-term Central Government Cash Management Bills (CMBs) Short-term Central Government Bonds or Dated G-Secs Long-term Central Government State Development Loans (SDLs) Long-term State Governments What are State Development Loans (SDLs)? State Governments also raise loans from the market which are called State Development Loans (SDLs). What are the features of SDLs? SDLs are dated (long-term) securities issued by State Government. Interest on SDLs is serviced at half-yearly intervals and the principal is repaid on the maturit...