What are Open Market Operations (OMOs)?

• Open Market Operations are conducted by the RBI which involves sale or purchase of G-Secs to or from the market. The objective is to control the money supply conditions.
• If there is excess money supply (i.e. excess liquidity) in the market, the RBI resorts to sale of securities which reduces the volume of money. Similarly, when the liquidity conditions are tight, it buys securities from the market, thereby releasing money into the market.

What are Government Securities (G-Secs)?

• G-Secs are tradable instruments like bonds issued by the Central Government or the State Governments with a promise of repayment upon maturity. 
• The Central Government can issue both treasury bills and bonds while the State Governments can issue only bonds, which are called the State Development Loans (SDLs).
• These securities are considered low-risk, since they involve the government and hence, are called risk-free gilt-edged instruments.

Why in News?

• The Reserve Bank of India has announced that it will conduct open market operations of government securities worth ₹20,000 crore in two tranches. 

Reference:

1. https://economictimes.indiatimes.com/markets/bonds/rbi-announces-special-omo-of-rs-20000-crore/articleshow/77734922.cms