With reference to ‘Financial Stability and Development Council’, consider the following statements.

1. It is an organ of Niti Aayog.
2. It is headed by the Union Finance Minister.
3. It monitors macroprudential supervision of the economy.

Which of the statements given above is/are correct?

The correct answer is 2 and 3 only.

To understand why, let us evaluate each statement carefully against what is established about the Financial Stability and Development Council (FSDC).

Background on FSDC:
The Financial Stability and Development Council (FSDC) was set up by the Government of India in December 2010 as a non-statutory apex body. It was created to strengthen and institutionalize the mechanism for maintaining financial stability, financial sector development, inter-regulatory coordination, and promoting financial literacy and financial inclusion in India.

Statement 1: "It is an organ of Niti Aayog." — This is INCORRECT.
The FSDC is not an organ of the NITI Aayog. NITI Aayog is a policy think-tank of the Government of India dealing with overall economic planning and policy. The FSDC, on the other hand, operates under the Ministry of Finance. It functions as an independent apex-level council specifically focused on financial sector regulation and stability. The two bodies are distinct in their mandate, composition, and institutional positioning. Therefore, Statement 1 is factually wrong.

Statement 2: "It is headed by the Union Finance Minister." — This is CORRECT.
The Union Finance Minister is the ex-officio Chairperson of the FSDC. This is a key structural feature of the council. The membership of FSDC includes the heads of all major financial sector regulators such as the:

- Reserve Bank of India (RBI) Governor
- Securities and Exchange Board of India (SEBI) Chairperson
- Insurance Regulatory and Development Authority of India (IRDAI) Chairperson
- Pension Fund Regulatory and Development Authority (PFRDA) Chairperson
- Insolvency and Bankruptcy Board of India (IBBI) Chairperson
- Finance Secretary and/or Secretary (Economic Affairs)
- Secretary (Financial Services)

Since the Finance Minister chairs the FSDC, it sits at the highest level of financial governance, ensuring coordinated oversight across all segments of the financial system. Statement 2 is therefore correct.

Statement 3: "It monitors macroprudential supervision of the economy." — This is CORRECT.
One of the core mandates of FSDC is to strengthen and institutionalize the mechanism for macroprudential supervision of the Indian economy. "Macroprudential supervision" refers to oversight of risks that affect the financial system as a whole — as opposed to microprudential supervision which focuses on individual institutions. The FSDC specifically monitors systemic risks, potential vulnerabilities in the financial system, and the overall health of inter-connected financial markets. It also coordinates between different regulators (RBI, SEBI, IRDAI, PFRDA) to ensure that no regulatory gaps exist that could trigger systemic instability. Statement 3 is therefore correct.

Conclusion:
Statement 1 is incorrect because FSDC is under the Ministry of Finance, not NITI Aayog. Statements 2 and 3 are both correct, as the FSDC is chaired by the Union Finance Minister and its mandate explicitly covers macroprudential supervision of the economy. Hence, the correct answer is "2 and 3 only".