Treasury bills are mainly:

Instruments for borrowing short term funds Instruments for borrowing long term funds. Instruments of Capital markets Both 1 and 3

Instruments for borrowing short term funds

Treasury Bill: A Treasury bill is basically an instrument of short-term borrowing by the Government of India maturing in less than one year. They are also known as Zero Coupon Bonds issued by the Reserve Bank of India on behalf of the Central Government to meet its short-term requirement of funds. Treasury bills are issued in the form of a promissory note.