Question Bank for UPSC Economics Business and Foreign Trade / व्यापार और विदेश व्यापार Foreign Trade and Investment in India

1)

Which of the following organisation provides guarantee to exporters?

A)

EXIM Bank

B)

Export Loan Guarantee Corporation

C)

RBI

D)

Commerce Ministry

View Solution

2)

Which of the following does not form part of current account of Balance of Payments?

A)

Export and import of goods

B)

Export and import of services

C)

Income receipts and payments

D)

Capital receipts and payments

View Solution

3)

Which institution is known as 'soft loan window' of World Bank?

A)

IFC

B)

IDA

C)

IMF

D)

Indian Development Forum

View Solution

4)

Global capital-flows to developing countries increased significantly during the nineties. In view of the East Asian financial crisis and Latin American experience, which type of inflow is good for the host country?

A)

Commerical loans

B)

Foreign Direct Investment

C)

Foreign Portfolio Investment

D)

External Commercial Borrowings

View Solution

5)

The earnings of India from diamond export is quite high. Which one of the following factors has contributed to it?

A)

pre-independene stock-piling of diamonds in the country which are now exported

B)

large production of industrial diamonds in the country

C)

expertise available for cutting and polishing of imported diamonds which are then exported

D)

as in the past, India produces huge quantity of gem diamonds which are exported

View Solution

6)

Which one of the following modes of privatization is the most comprehensive and complete?

A)

introduction of private capital in public sector

B)

contracting out management of public enterprises to the private sector

C)

transferring ownership and management to the workers

D)

transferring ownership and management to the private sector

View Solution

7)

Which one of the following types of borrowings from the IMF has the softest servicing conditions?

A)

Second tranche loan

B)

SAF

C)

ESAF

D)

Oil facility

View Solution

8)

Which unit of valuation is known as 'paper gold'?

A)

Eurodollar

B)

Petrodollar

C)

SDR

D)

GDR

View Solution

9)

Which of the following is not one of the features of the Special Economic Zones (SEZ) being set up for promoting exports?

A)

The SEZ area will be treated as foreign territory for trade operations, duties and tariff.

B)

No licence is required for import into the zone.

C)

Foreign workers will be allowed free entry without visa restrictions.

D)

There will be no routine examination by customs authorities of import/export cargo.

View Solution

10)

Which of the following is considered lending for promotion of exports?

A)

Packing Credit

B)

Overdraft

C)

Cash Credit Account

D)

Bill Discounting

View Solution

11)

For National Manufacturing and Investment Zones (NMIZ), Special Economic Zone (SEZ) and EOUs (Exports Oriented Units), which of the following statement is true?

A)

NMIZs and EOUs will be located within SEZs

B)

SEZs and EOUs will be located within NMIZs.

C)

NMIZs are independent of SEZs and EOUs.

D)

NMIZs and SEZs will be competitors in nature

View Solution

12)

Both Foreign Direct Investment (PDI) and Foreign Institutional Investor (FII) are related to investment in a country. Which one of the following statements best represents an important difference between the two?

A)

FII helps bring better management skills and technology, while FDI only brings in capital.

B)

FII helps in increasing capital availability in general, while FDI only targets specific sectors.

C)

FDI flows only into the secondary market while FII targets primary market

D)

FII is considered to be more stable than FDI.

View Solution

13)

A great deal of Foreign Direct Investment (FDI) to India comes from Mauritius than from many major and mature economies like UK and France. Why?

A)

India has preference for certain countries as regards receiving FDI

B)

India has double taxation avoidance agreement with Mauritius

C)

Most citizens of Mauritius have ethnic identity with India and so they feel secure to invest in India

D)

Impending dangers of global climatic change prompt Mauritius to make huge investments in India

View Solution

14)

A)

United Nations Conference on Trade and Development (UNCTAD)

B)

United Nations Organization (UNO)

C)

World Trade Organization (WTO)

D)

World Bank (WB)

View Solution

15)

Which is the role of the International Monetary Fund (IMF)?

A)

To implement and advance global trade agreements

B)

To settle industrial and trade disputes between members

C)

To help poorer countries with their economic development

D)

To maintain international financial stability in global financial markets

View Solution

16)

Which of the following is not an argument for protectionism?

A)

To protect infant industries

B)

To increase the level of imports

C)

To protect strategic industries

D)

To improve the balance of payments

View Solution

17)

Dumping in the context of international trade refers to :

A)

Exporting goods at prices below the cost of production

B)

Exporting goods of inferior quality

C)

Exporting goods only to re-import them at cheaper rates

D)

Exporting goods without paying appropriate taxes in the receiving country

View Solution

18)

Foreign Direct Investment involves:

A)

A speculator trying to make a profit by buying company shares on a foreign stock exchange.

B)

A UK energy company buying territory abroad where it expects to find oil reserves.

C)

A tourist purchasing foreign currency to spend on a holiday abroad.

D)

A company signing an agreement with a wholesaler to distribute its products in foreign markets.

View Solution

19)

Many a times we read about Hot Money in newspapers. Which among the following options rightly describes hot money?

A)

Hot money is useful and generally durable and is good for the country in all weathers

B)

Hot money is dangerous and volatile and leaves the country in bad weather conditions

C)

Hot money is good and adds to the development of the country & it comes from exports of services

D)

Hot money is bad & useless as its arises from unusual activities like casinos, gambling, horse races, speculations etc.

View Solution

20)

A systematic record of all economic transactions completed between residents of a country and the rest of the world in a year is known as..?

A)

Net Capital Flow

B)

Balance of Payment

C)

Balance of Trade

D)

Absolute Flow

View Solution

21)

Asian Financial Crisis of 1997 started from which of the following countries?

A)

Myanmar

B)

Thailand

C)

Cambodia

D)

Malaysia

View Solution

22)

Many a times we read in the newspapers that when Foreign Capital is allowed to enter the country freely, it can affect the economy adversely. Which among the following is a correct reason for the above assumption?

A)

It affects the balance of payments of the country by adversely affecting the Current Account

B)

It poses risks to the value of the country's currency as well as management of local liquidity

C)

The foreign capital earns profit in the country which is repatriated

D)

The Balance of Trade of the country is badly affected by Foreign Capital Inflows

View Solution

23)

TANKAN is revision of the Industry Classification of the Short-term Economic Survey of Enterprises (usually quarterly) is used in following country?

A)

Japan

B)

South Korea

C)

China

D)

All of them

View Solution

24)

Which among the following is the most important source region of NRI remittances to India?

A)

North America

B)

Europe

C)

Asia Pacific

D)

South America

View Solution

25)

In context with the two way trade of India with different regions, which among the following region is India's largest trade partner?

A)

EU Region

B)

Gulf Region

C)

North America

D)

Latin America

View Solution

26)

Which among the following will be a debit entry in India's balance of payments?

A)

Imports of goods by India.

B)

Income of Indian investments abroad.

C)

Receipts of transfer payments.

D)

Exports of services by India.

View Solution

27)

Which among the following countries is currently the biggest supplier of crude oil to India?

A)

Iran

B)

Saudi Arabia

C)

UAE

D)

Nigeria

View Solution

28)

IMF can grant loan to _______?

A)

Any sovereign country of the World

B)

Any sovereign country of the World and Public Sector companies backed by Sovereign guarantee

C)

Any Member country of IMF

D)

Any Member country of IMF and Public Sector

View Solution

29)

Companies backed by Sovereign guarantee of Member Country In which among the following forms, the Special Drawing Rights (SDR) are kept as currency of International Monetary Fund?

A)

Paper Currency

B)

Gold

C)

Book Keeping Entry

D)

A combination of all of three

View Solution

30)

A new term Lourdes Treatment and Resuscitation Option (LTRO) was making news in context with which among the following?

A)

World Bank

B)

International Monetary Fund

C)

European Central Bank

D)

Federal Reserve Bank of America

View Solution

31)

Christine Lagarde is the head of which among the following international agencies / bodies?

A)

Asian Development Bank

B)

Non-alignment Movement

C)

International Atomic Energy Agency

D)

International Monetary Fund

View Solution

32)

AoA in context with World Trade Organization is_____?

A)

Article of Association

B)

Agreement on Agriculture

C)

Agreement on Association

D)

Administration of Agriculture

View Solution

33)

Areas which are engines for economic growth supported by quality infrastructure and complemented by an attractive fiscal package are known as

A)

Export Processing Zones

B)

Duty Free Tariff Zones

C)

Special Economic Zones

D)

Technology Parks

View Solution

34)

Consider the following statements.

Most internationals agencies which fund development programmes in Indian on inter-government bilateral agreements, mainly provide.

1. Technical assistance

2. Soft loans which are required to be paid back with interest

3. Grants, not required to be paid back

4. Food assistance to alleviate poverty

A)

2 and 4 are correct

B)

1, 2 and 3 are correct

C)

1, 2 and 4 are correct

D)

3 and 4 are correct

View Solution

35)

FDI in Multi-Brand Retail Trade (MBRT) in all products is now permitted in India subject to

1. a ceiling of 51%

2. minimum amount to be brought in as FDI by the foreign investor is US

100 million.

3. at least 50% of the procurement of manufactured/processed products should be sourced from 'small industries'.

4. retail sales locations set-up only in cities with a population of more than 10 lakh.

Select the correct answer using the codes given below

A)

1, 2, 3 and 4

B)

1 and 4

C)

Only 2

D)

1, 2 and 4

View Solution

36)

Which of the following were the aims behind the setting up of the World Trade Organization (WTO)?

1. promotion of free trade and resource flows across countries

2. protection of intellectual property rights

3. managing balanced trade between different countries

4. promotion of trade between the former East Bloc countries and the Western World

A)

1, 2, 3 and 4

B)

1 and 2

C)

2 and 3

D)

1 and 4

View Solution

37)

Consider the following statements in respect of the functions of World Trade Organisation (WTO):

1. It seeks to make international trade free by establishing predictable and transparent ground rules.

2. It promotes capital flow from developed to developing countries.

3. It provides a forum for trade negotiations.

4. It works as a neutral agency for settlement of trade disputes.

Identify the correct statements from the above:

A)

1, 3 and 4

B)

2, 3 and 4

C)

1, 2, 3 and 4

D)

1, 2 and 3

View Solution

38)

Which of the following statement is not correct in relation to International Monetary Fund?

1. India is a founder member of the IMF.

2. IMF conducts regular review of India's economic status under Article IV.

3. India?s quota in the IMF is more than 2 per cent

4. Finance Minister is ex-officio Governor of the IMF.

A)

1 and 4

B)

3 only

C)

1 only

D)

2 and 4

View Solution

39)

The New Economic Policy (1991) was launched in the background of the following economic indicators:

1. India's foreign exchange reserves had fallen to US

1 billion.

2. The fall of the Soviet Union had deprived India of almost a quarter of its export market.

3. There was negative growth in real GDP.

Indian rupee had to be devalued by 45 per cent.

A)

1, 2, 3 and 4

B)

1 only

C)

1 and 2

D)

1, 2 and 3

View Solution

40)

Which of the following pairs are correctly matched?

1. Increase in-monetary expansion

2. Low import growth rate in India-Recession in Indian industry

3. Euro-issues-Shares held by Indian companies in European countries

4. Portfolio investment-Foreign institutional investors.

A)

1, 2 and 4

B)

3 and 4

C)

1, 2 and 3

D)

1, 2, 3 and 4

View Solution

41)

Which of the following would include Foreign Direct Investment in India?

1. Subsidiaries of foreign companies in India

2. Majority foreign equity holding in Indian companies

3. Companies exclusively financed by foreign companies

4. Portfolio investment

Select the correct answer using the codes given below

A)

1, 2, 3 and 4

B)

2 and 4

C)

1 and 3

D)

1, 2 and 3

View Solution

42)

Which of the following is correct about 'Foreign direct investment' (FDI)?

1. Through FDI a company buys a company in the target country.

2. Through PDI a company expand operations of an existing business in the target country.

3. FDI is an investment in the securities of another country such as stocks and bonds.

4. FDI is an investment directly into production in a country by a company located in another country.

A)

1 and 2

B)

1, 2 and 4

C)

1, 2 and 3

D)

1, 2, 3 and 4

View Solution

43)

International Monetary Fund (IMF) argues that developing economies hold a massive stockpile of foreign exchange.

Which could be the consequences of such stockpiling?

1. A trade imbalance or major difference in value of imports/exports is generated between the developing and emerging economies and the rich countries.

2. Such an imbalance is not a healthy sign.

These imbalances have caused the current global economic crisis.

3. Such stockpiling is responsible not only for problems in trade balances but leads to money laundering.

A)

1 only

B)

2 only

C)

3 only

D)

1, 2 and 3

View Solution

44)

Consider the following statements relating to the World Trade Organization (WTO):

1. The WTO deals with the global rules of trade between nations.

2. The goal of the WTO is to help producers of goods and services, exporters, and importers conduct their business.

3. The WTO, which is a successor body of the General Agreement on Tariffs and Trade, came into being following the Uruguay Round of Negotiations.

4. The WTO distances itself in framing of rules on trade in intellectual property rights.

Which of the statements given above are correct?

A)

1, 2 and 3

B)

2, 3 and 4

C)

1, 2 and 4

D)

1 and 3 only

View Solution

45)

Foreign Direct Investments are preferred over Capital Inflow. In this context, please consider the following.

1. FDI brings in latest technology

2. FDI does not involve large outflow

3. FDI improves working efficiency

Which is/are most suitable reason/reasons for the given statement?

A)

1 only

B)

1 and 3

C)

1 and 2

D)

All 1, 2 and 3

View Solution

46)

Consider the following:

1. Balance of trade

2. Net factor income

3. Net transfer payments

Which among the above make the part of the "Capital Account"?

A)

Only 1

B)

1 & 2

C)

2 & 3

D)

1, 2 & 3

View Solution

47)

Consider the following statements:

1. Indian Rupee has faced 2 devaluations till now

2. Indian Rupee faced highest devaluation in 1966

Which among the above statements is / are correct?

A)

Only 1 is correct

B)

Only 2 is correct

C)

Both 1 and 2 are correct

D)

Neither 1 nor 2 is correct

View Solution

48)

Consider the following statements regarding the Indian Depository Receipts?

1. An IDR declares ownership of shares of a Foreign Company

2. The Shares in an IDR are held by an Indian Custodian

3. Using IDR, the Indian Residents get a chance to invest in a listed foreign entity

Which among the above statements is / are correct?

A)

Only 1

B)

Only 2

C)

Only 1 & 2

D)

Only 1 & 3

View Solution

49)

Market Economy:

1. The role of market forces and competition is eliminated by law

2. There is a high degree of competition in both commodity and factor markets

3. Private gains are the main motivating and guiding force for carrying out economic activities

Which among the above is/ are correct statements?

A)

Only 1 & 2 are correct

B)

Only 2&3 are correct

C)

All are correct

D)

None of them is correct

View Solution

50)

We read in the newspapers that the Foreign Direct Investments are preferred over the Capital Inflow. In this context, please consider the following:

1. FDI brings in latest technology

2. FDI does not involve large outflow

3. FDI Improves efficiency of the economy

Which among the above is / are most suitable reasons for the given statement?

A)

Only 1

B)

Only 1 & 3

C)

Only 1 & 2

D)

All 1, 2 & 3

View Solution

51)

Which of the following constitute the Capital Account?

1. Foreign Loan.

2. Foreign Direct Investment.

3. Private Remittances.

4. Portfolio Investment.

Select the correct answer using the codes given below

A)

2 & 4

B)

1 & 3

C)

1 & 2

D)

1, 2 & 4

View Solution

52)

Consider the following:

1. International Bank for Reconstruction and Development (IBRD)

2. International Development Association (IDA)

3. International Finance Corporation (IFC)

4. Multilateral Investment Guarantee Agency (MIGA)

5. International Centre for Settlement of Investment Disputes (ICSID)

Which among the above constitute the World Bank group?

A)

1 2

B)

1 2 3

C)

1 2 3 4

D)

1 2 3 4 5

View Solution

53)

Consider the following statements:

1. The Foreign Exchange Management Act FEMA became an act on the 1st day of June, 2002.

2. It replaced FERA.

3. It made all offenses regarding foreign exchange civil offenses, as opposed to criminal offenses as dictated by FERA.

Which of the statements given above is/are correct?

A)

1 and 2

B)

2 and 3

C)

1 and 3

D)

None

View Solution

54)

Consider the following statements:

1. Kelkar Committee is associated to oil and gas.

2. Kelkar Committee has to prepare a roadmap for enhancing import of oil and gas.

Which of the statements given above is/are correct?

A)

1 only

B)

2 only

C)

1 and 2

D)

None

View Solution

55)

Consider the following statements:

1. The Petrapole-Benapole border checkpoint controls the foreign trade between India and Bangladesh.

2. Petra pole is on Bangladesh side and Benapole is on Indian side.

Which of the statements given above is/are correct?

A)

1 only

B)

2 only

C)

1 and 2

D)

None

View Solution

56)

Which of the following would include Foreign Direct Investment in India?

1. By incorporating a wholly owned subsidiary or company anywhere

2. By acquiring shares in an associated enterprise

3. Through a merger or an acquisition of an unrelated enterprise

4. Participating in an equity joint venture with another investor or enterprise

Select the answer using the codes given below.

A)

1 and 2

B)

2, 3 and 4

C)

1, 3 and 4

D)

1, 2, 3 and 4

View Solution

57)

Consider the following statements:

1. International Monetary Fund (IMF) was initiated in 1944 at the Bretton Woods Conference and formally created in 1945.

2. IMF grants loan to member country and other developing countries.

Which of the statements given above is/are correct?

A)

1 only

B)

2 only

C)

1 and 2

D)

None

View Solution

58)

Consider the following statements regarding the Federation of Indian Export Organisation (FIEO):

1. FIEO was set up in 1965 under the aegis of Ministry of Commerce.

2. It is an apex body of Export Promotion Organisations

3. FIEO renders an integrated package of services to various organizations connected with export promotion.

Which of the statements given above is/are correct?

A)

1 only

B)

2 only

C)

1 and 2

D)

1, 2 and 3

View Solution

59)

Match the following countries with its currencies:

	Country		Currency
I.	US	a.	Yen
II.	China	b.	Dollar
III.	Japan	c.	Pound
IV.	Britain	d.	Yuan

A)

I - b, II - d, III - a, IV - c

B)

I - a, II - d, III - b, IV - c

C)

I - b, II - c, III - a, IV - d

D)

I - a, II - c, III - b, IV - d

View Solution

60)

Which sentence is correct regarding foreign exchange?

I. Foreign exchange reserves in India comprises of 6 elements.

II. Foreign exchange management can be done in three possible ways: Fixed currency regime, floating currency regime and managed exchange rates.

III. Silver is an element of foreign exchange reserve

A)

I & II

B)

Only II

C)

Only III

D)

None of the above

View Solution

61)

Which sentences are correct regarding special drawing rights?

I. It was created in 1980

II. It is also known as "paper gold".

III. Its value is based on a basket of five key international key currencies and SDRs can be exchanged for freely usable currencies

A)

Only II

B)

I & III

C)

II & III

D)

All the above

View Solution

62)

Which of the statement is correct according to Fixed Exchange rates?

1. Fixed rates are currency values which are tied to a precious metal such as gold, or anchored to another currency, like the US Dollar.

II. Under a fixed system, a currency can rise or fall due to changes in demand or supply of currencies on the foreign exchange market.

III. Under this imports and exports can readjust to move the balance of payments back towards a desirable equilibrium.

A)

I & II

B)

I & III

C)

II & III

D)

Only I

View Solution

63)

Why did the fixed exchange rate system collapsed?

1. The buildup of US debts abroad as a result of the need to fund the war in Vietnam

II. Inflation in the USA

III. Growing doubts about the stability of the US

.

A)

Only I

B)

I & II

C)

II & III

D)

All the above

View Solution

64)

Match the following percentage of world trade in different years of India:

	Year		Percentage
I.	1950?s	a.	0.59%
II.	1990?s	b.	2%
III.	2015	c.	1.78%

A)

I - b, II - c, III - a

B)

I - c, II - a, III - b

C)

I - a, II - b, III - c

D)

None of these

View Solution

65)

What are the categories in which India export?

I. Agricultural and Allied Products

II. Mineral Fuel and Lubricants

III. Coal and petroleum

A)

Only II

B)

I & II

C)

Only III

D)

None of the above

View Solution

66)

What are the facts regarding structural change in India?s export since 1991?

I. There are indications that during 1990s some of Indian exports have moved upwards in value addition chain whereby instead of exporting raw materials the country has switched over to export of processed goods.

II. There were significant compositional shift within the major manufactured product groups such as engineering goods chemicals and allied products etc.

A)

Only II

B)

Only I

C)

Both I & II

D)

None of the above

View Solution

67)

Match the following export products of India with the Percentage they constitute:

	Products		Percentage
I.	Petroleum	a.	4%
II.	Gems & Jewellery	b.	7.8%
III.	Transport & Equipment?s	c.	20.4%
IV.	Machinery	d.	16.3%

A)

I - c, II - d, III - b, IV - a

B)

I - a, II - c, III - b, IV - d

C)

I - b, II - a, III - d, IV - c

D)

I - d, II - c, III - a, IV - b

View Solution

68)

Which statements are true regarding India's Import?

I. In 1947-48 the main items of India's imports were machineries, oil, grains, cotton, cutlery, hardware implements, chemicals, etc.

II. They constituted 70% of India's imports

A)

Only II

B)

Only I

C)

Both I & II

D)

None of the above

View Solution

69)

What is meant by term Balance of Payment?

I. Those transactions arising out of exports and imports (the visible items)

II. It is astatistical statement of all transactions made between one particular country and all other countries during a specified period of time

III. This account is the summary of all international trade transactions of the domestic country in one year

A)

I & III

B)

Only I

C)

Only II

D)

None of the above

View Solution

70)

What is meant by term Balance of Trade?

I. Those transactions arising out of exports and imports (the visible items)

II. It is a statistical statement of all transactions made between one particular country and all other countries during a specified period of time

III. This account is the summary of all international trade transactions of the domestic country in one year

A)

I & III

B)

Only I

C)

Only II

D)

None of the above

View Solution

71)

Which statement is correct regarding Current account?

I. Those transactions arising out of exports and imports (the visible items)

II. It is a statistical statement of all transactions made between one particular country and all other countries during a specified period of time

III. This account is the summary of all international trade transactions of the domestic country in one year

A)

I & II

B)

Only I

C)

II & III

D)

Only III

View Solution

72)

Which statement is incorrect regarding balance of payment?

I. BoP compares the dollar difference of the amount of exports and imports, including all financial exports and imports.

II. A negative balance of payments means that more money is flowing out of the country than coming in and vice versa.

III. The balance of payment is maintained by State Bank of India

A)

I & III

B)

Only III

C)

II & III

D)

Only I

View Solution

73)

Match the following current accounts with their examples:

	CA
I.	Visible Trade	a.	Gifts
II.	Invisible Trade	b.	Tea
III.	Unilateral Transfer	c.	Insurance

A)

I ? b II ? c III ? a

B)

I ? a II ? c III ? b

C)

I ? c II ? a III ? b

D)

None of these

View Solution

74)

Which statement is correct regarding capital account?

I. On the credit side of this account receipt of foreign exchange due to Foreign Direct Investment (FDI) Foreign Capital Investment (FCI) and Foreign Borrowing (FB) is recorded.

II. On the debit side of capital account payment of foreign exchange due to Direct Investment Abroad (DIA) Portfolio Investment Abroad (PIA) and Foreign Lending (FL) is recorded.

A)

Only II

B)

Only I

C)

Both I & II

D)

None of the above

View Solution

75)

Which of the below statements are correct?

I. Reverse account balance makes an adjustment between current account balance and capital account balance.

II. If surplus in the Capital Account is more than deficit in the Current Account, there is net increase in the Forex Reserves of the country at the end of the year.

III. If deficit in the current account is more than surplus in the Capital Account then there is net decrease in Foreign Reserves of the country at the end of the year.

A)

I & II

B)

I & III

C)

Only II

D)

All the above

View Solution

76)

Which statement is correct regarding balance of payment crises?

I. If international reserves of a country are not enough to balance a combined deficit in current and capital account on a sustained basis, then the phenomenon is called a BoP crisis.

II. It can be tackled by exporting more or by limiting imports through tariffs, quotas, etc. Contractionary fiscal and monetary policies can also tackle the crisis through lower import demand with fall in average income levels.

III. Another short term solution is currency devaluation which encourages exports and discourages costlier imports.

A)

Both I & II

B)

Only I

C)

II & III

D)

All the above

View Solution

77)

Which statement is incorrect regarding India's balance of payment?

I. 1994-95 was the year of the acute BOP crisis in India.

II. India then had foreign exchange reserve of mere 3 billion dollar

III. This crisis led to the massive changes in the country's economic policy, popularly known as the Structural Adjustment Program or New Economic Policy (NEP) regime, focusing on liberalization and global ization of the economy.

A)

I & III

B)

I & II

C)

Only III

D)

Only I

View Solution

78)

What conditions are correct that came with the medium term loan given by IMF to India for restructuring of the economy?

I. Government expenditure to be cut by 20% per annum

II. Devaluation of rupee by 22%.

III. Excise duty to be increased by 40% .Q

IV. Custom duty to be cut drastically from the peak of 130% to 30%

A)

II & IV

B)

I & II

C)

III & IV

D)

Only II

View Solution

79)

What are the factors on which import substitution strategy was based on?

I. Non price

II. Physical interventionist policies like licensing. Quotas and other physical restrictions on imports

A)

only II

B)

Only I

C)

Both I & II

D)

None of the above

View Solution

80)

Why there was the need for export promotion in India?

I. Primary products exporting countries have an unfavourable term of trade. The earnings from primary product exports were low and unstable

II. Secondly, the quality of Indian products was not up to the world standards due to which we could not sustain markets.

III. Third, only residue products were mainly exported. The fact that export earnings also contribute to economic development was overlooked.

A)

I & III

B)

II & III

C)

Only III

D)

All the above

View Solution

81)

Which of the below statements are correct regarding exchange trade?

I. The value of rupee was managed by the state bank

II. The strict foreign exchange controls also encouraged hawala trade

III. India followed a strongly inward looking policy, laying stress on import substitution

A)

Only I

B)

Both II & III

C)

Only III

D)

All the above

View Solution

82)

Choose the correct sentence regarding the trade policy:

I. Mahalanobis strategy adopted during the First plan

II. Export increased at an average rate of 29 per cent per annum in dollar terms between 1986 and 1990

III. A combination of factors such as bad policy, weak government and external factors led to the decline of this performance to nine per cent in 1990-91 and 4 per cent in the subsequent years.

A)

Only III

B)

I & II

C)

II & III

D)

All the above

View Solution

83)

What was the main reason of introducing trade reforms in 1991?

I. Make exports competitive

II. Unshackle foreign trade from the clutches of a control regime

III. Allow import of most goods using only tariff as a restraint

A)

I & II

B)

Only II

C)

Only III

D)

All the above

View Solution

84)

What are the key features of trade policy?

I. India to be made a significant participant in world trade by 2025

II. Merchandize exports from India (MEIS) to promote specific services for specific Markets Foreign Trade Policy

III. FTP would reduce export obligations by 50% and give boost to domestic manufacturing

A)

I & II

B)

Only II

C)

II & III

D)

All the above

View Solution

85)

Which is the correct statement according to FTP 15 - 20?

I. FTP 2015-20 introduces two new schemes, namely "Merchandise Exports from India Scheme (MEIS)" and "Services Exports from India Scheme (SEIS)"

II. These schemes (MEIS and SEIS) replace multiple schemes earlier in place, each with different conditions for eligibility and usage.

III. Incentives (MEIS & SEIS) to be available for SEZs also e-Commerce of handicrafts, handlooms, books etc., eligible for benefits of MEIS.

IV. FTP benefits from both MEIS & SEIS will be extended to units located in SEZs.

A)

I & II

B)

II & IV

C)

Only III

D)

All the above

View Solution

86)

Which statement is not correct according to MEIS?

I. Agricultural and village industry products to be supported across the globe at rates of 3 % and 5 % under MEIS.

II. Higher level of support to be provided to processed and packaged agricultural and food items under MEIS.

A)

Only I

B)

Only II

C)

Both I & II

D)

None of the above

View Solution

87)

What are the objectives of SEZ act?

I. Generation of additional economic activity.

II. Promotion of exports of goods & services.

III. Promotion of investment from domestic and foreign sources.

IV. Creation of employment opportunities

A)

I & II

B)

II & IV

C)

Only III

D)

All the above

View Solution

88)

Which points are correct regarding SEZ act?

I. Exemption to SEZ developer and units from Minimum Alternate Tax.

II. Constitution of an authority for each SEZ with a view to providing greater administrative, financial and functional autonomy to these zones.

III. Establishment of designated courts and a single enforcement agency to ensure speedy trial and investigation of offences committed in SEZs.

A)

I & II

B)

Only II

C)

Only III

D)

All the above

View Solution

89)

Consider the following statements:

I. Agriculture, horticulture, poultry, fisheries and dairying have been included in export-oriented units.

II. Export processing zone units have also been allowed to export through trading and star trading houses and can have equipment on lease.

Which of the following statements are true regarding Export Units:

A)

Only II

B)

Only I

C)

Both I & II

D)

None of the above

View Solution

90)

Consider the following statements:

I. These zones were created to develop such an environment in the economy which may provide capability of facing international competition.

II. The Export Processing Zone (EPZs) set up as enclaves, separated from the Domestic Tariff Area by fiscal barriers, were intended to provide a competitive duty free environment for export production

III. There are total 10 EPZs in our country

Which statement is/are correct regarding export processing zone?

A)

Only III

B)

I & II

C)

II & III

D)

All the above

View Solution

91)

Match the States with their cities where there are EPZs in India:

	States		City
I.	Gujarat	a.	Noida
II.	West Bengal	b.	Kandia
III.	U.P West	c.	Faeta (it is a placein Bengal which is mentioned in the chapter)

A)

I - b, II - c, III - a

B)

I - a, II - c, III - b

C)

I - b, II - a, III - c

D)

I - c, II - b, III - a

View Solution

92)

Which statement is correct regarding export oriented units?

I. Since 1981, the Government introduced a complementary plan of EPZ (Now converted into SEZ) scheme for promoting export units.

II. Under this scheme the Government provides various incentives to increases the production capacity of these units so as to increase exports of the country.

III. This scheme offers a wider source of raw materials, hinterland facilities, availability of technological skills, existence of an industrial base and the need for a larger area of land for the project.

A)

Only III

B)

I & II

C)

II & III

D)

All the above

View Solution

93)

Which statement is correct regarding Export houses?

I. To increases the marketable efficiency of exporters, the Government introduced the concept of export houses, trading houses and star trading houses.

II. Those registered exporters who have shown good export performances over past few years have been given the status of export houses, and trading houses.

III. Units having such classification are required to achieve the prescribed average export performance level and earning of foreign exchange.

A)

Only III

B)

I & II

C)

II & III

D)

All the above

View Solution

94)

Which statement is correct regarding EPIP?

I. EPIP was introduced in 1996

II. It is sponsored by centre

III. It provides 80% grant to the state

A)

II & III

B)

Only I

C)

I & II

D)

All the above

View Solution

95)

Match the area with the state where there are EPIPs in India:

	Column I		Column II
I.	Rajasthan	a.	Amingaon
II.	Maharashtra	b.	Sitapura
III.	Kerala	c.	Ambarnath
IV.	Assam	d.	Kakkinad

A)

I - b, II - c, III - d, IV - a

B)

I - a, II - c, III - d, IV - b

C)

I - d, II - c, III - b, IV - a

D)

I - c, II - b, III - a, IV - d

View Solution

96)

Which statement is correct regarding FDI?

I. FDI is a non-debt capital flow, is a leading source of external financing, especially for the developing economies.

II. It not only brings in capital and technical know- how but also increases the competitiveness of the economy.

III. Overall it supplements domestic investment, much required for sustaining the high growth rate of the country.

IV. Since 2000, significant changes have been made in the FDI policy regime by the government to ensure that India becomes an increasingly attractive and investor-friendly destination.

A)

I & II

B)

II & III

C)

Only IV

D)

All the above

View Solution

97)

Are the statements given below the subset of the third category of FDI?

I. It consists of sectors where automatic approval is granted for FDI (often foreign equity participation less than 100 per cent)

II. It consists of sectors where prior approval from the Foreign Investment Approval Board (FIPB) is required

A)

Only I

B)

Only II

C)

Both I & II

D)

Neither I & II

View Solution

98)

What are the sectors with 100% FDI?

I. Agriculture

II. Advertising

III. Air transport service

IV. Drugs and pharmaceuticals

A)

I & II

B)

II & IV

C)

Only III

D)

All the above

View Solution

99)

Match the following sectors with the percentage of FDI:

	Sectors		Percentage
I.	Private sector banking	a.	49%
II.	Defence	b.	20%
III.	Print media	c.	74%
IV.	Public sector banks	d.	26%

A)

I - c, II - a, III - d, IV - b

B)

I - d, II - a, III - c, IV - b

C)

I - a, II - a, III - c, IV - b

D)

I - c, II - d, III - a, IV - b

View Solution

100)

Foreign exchange reserves of India comprise of which elements?

I. Gold

II. Special Drawing Rights (SDR)

III. Foreign currency assets

IV. Reserve Tranche Position (RTF) in the IMF

A)

I & II

B)

II & III

C)

Only III

D)

All the above

View Solution

101)

Which statement is correct regarding FDI?

I. The success of foreign exchange management by RBI can be seen in the fact that from US

5.8 billion in March 1991 (enough to meet the import requirements for three weeks) the country's reserves have grown to around US

352 billion by December 2015.

II. It is pertinent to note here that some of the increase in the reserve is attributed to the weakness of the dollar in the post-Iraq war scenario.

A)

Only I

B)

Only II

C)

Both I & II

D)

Neither I & II

View Solution

102)

Imports of India are classified into:

I. Petroleum Products

II. Pearls and Precious Stones

III. Iron and Steel

IV. Fertilizers

A)

I & II

B)

Only II

C)

Only IV

D)

All the above

View Solution

103)

Match the following imports of products with the percentage:

	Column I		Percentage
I.	Gold	a.	7.3%
II.	Petroleum	b.	12.7%
III.	Electronic goods	c.	30.7%

A)

I - b, II - c, III - a

B)

I - a, II - c, III - b

C)

I - c, II - b, III - a

D)

I - b, II - a, III - c

View Solution

104)

Which of the following is/are not FDI policy change(s) after 2010?

1. Permission of 100 percent FDI in automotive sector.

2. Permitting foreign airlines to make FDI up to 49 percent

3. Permission of up to 51 percent FDI under the government approval route in multi-brand retailing, subject to specified conditions

4. Amendment of policy on FDI in single-brand product retail trading for aligning with global practices

Select the correct answer using the code given below:

A)

1 only

B)

2 and 4 only

C)

1 and 2 only

D)

1, 2 and 3 only

View Solution

UPSC Economics Business and Foreign Trade / व्यापार और विदेश व्यापार Question Bank

done Foreign Trade and Investment in India Total Questions - 104

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Foreign Trade and Investment in India Total Questions - 104