For sterilization of the Capital Inflows, RBI uses:

Answer: [C] Open Market Operations

An open market operation (OMO) is an activity by a central bank to give (or take) liquidity in its currency to (or from) a bank or a group of banks. The central bank can either buy or sell government bonds in the open market.

This question is a part of GKToday's Integrated IAS General Studies Module