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TEST BOOKLET

GENERAL STUDIES (P) 2025 – Test – 4707

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Time Allowed: Two Hours Maximum Marks: 200

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that there is more than one correct response with you consider the best. In any case, choose ONLY ONE response
for each item.

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should hand over to Invigilator only the answer sheet. You are permitted to take away with you the Test Booklet.
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9. Sheet for rough work are appended in the Test Booklet at the end.
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DO NOT OPEN THIS BOOKLET UNTIL YOU ARE ASKED TO DO SO
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1. Consider the following statements regarding 4. In the context of macroeconomics, 'Broad
Regional Rural Banks (RRB): Money' includes which of the following along
1. They are jointly set up by the central with currency in circulation?
government, state government, and a (a) Time deposits held by commercial banks
public sector bank with the state and post offices
government holding majority of stake. (b) Demand deposits held by Banks
2. They are regulated by RBI and
(c) Both (a) and (b)
supervised by state governments.
(d) Cash Reserves of the Banks held with
3. The Priority Sector Lending Target for
RBI
RRB is 90 percent of their Adjusted Net
Bank Credit (ANBC).
5. Under this Public-Private Partnership model,
How many of the above statements are
the cost is completely borne by the
correct?
government. The government invites bids for
(a) Only one
engineering knowledge from private players.
(b) Only two
(c) All three Procurement of raw materials and
(d) None construction costs are met by the government.
The private sector's participation is minimal
2. This concept discusses that taxation and and is limited to the provision of engineering
borrowing are equivalent means of financing expertise.
expenditure. When the government increases Which of the following investment models
spending by borrowing today, which will be has been described the passage given above?
repaid by taxes in the future, it will have the (a) Build Operate and Transfer (BOT)
same impact on the economy as an increase Annuity Model
in government expenditure that is financed by (b) Engineering, Procurement and
a tax increase today. Construction (EPC) Model
Which of the following concepts has been (c) Build Operate and Transfer (BOT) Toll
described by the passage given above? Model
(a) Ricardian equivalence (d) Hybrid Annuity Model (HAM)
(b) Smithian equivalence
(c) Phillip’s equivalence 6. Consider the following statements regarding
(d) Nashian equivalence Treasury Bills (T-bills): O
C
1. They are zero coupon securities that are
S.

3. The output of a Japanese car company located

issued at a discount and redeemed in face
in India would be
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value at maturity.
(a) Included in Japan's gross domestic
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2. These are long term debt instruments

product (GDP) but in India's Gross
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issued for maturities of more than 364

National Product (GNP).
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days.
(b) Included in both Japan's and India's
Which of the statements given above is/are
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gross domestic product (GDP).

corerct?
D

(c) Included in India's gross domestic

(a) 1 only
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product (GDP) but in Japan's Gross

National Product (GNP). 2 (b) 2 only
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(d) Included in both Japan's and India's (c) Both 1 and 2

(d) Neither 1 nor 2
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gross national product (GNP).

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7. Which of the following statements best 9. Consider the following statements regarding
describes the Balance of Payment (BOP) of a Foreign Direct Investment (FDI) and Foreign
country? Portfolio Investment (FPI) in India:
(a) It is a comprehensive record of all
1. Foreign Direct Investment (FDI) is the
economic transactions between
investment through equity instruments by
government of a country and the
a person resident outside India under
governments of rest of the world over a
certain conditions.
specific period.
(b) It is a statistical analysis of a country's 2. FPI often leads to technology transfer,

domestic budget, including government job creation, and infrastructure

expenditures and tax revenues. development in the host country, whereas
(c) It is a measure of a country's net foreign FDI primarily affects the liquidity and
exchange reserves over a specific period. efficiency of financial markets.
(d) It is a systematic record of all
Which of the statements given above is/are
transactions in goods, services and assets
correct?
between residents of a country and the
(a) 1 only
rest of the world over a defined period.
(b) 2 only

8. With reference to MSME categorisation, (c) Both 1 and 2

consider the following statements: (d) Neither 1 nor 2

1. Micro enterprises are those with
investments not more than Rs.1 crore and 10. Consider the following statements regarding
annual turnover not more than Rs. 5
the World Trade Organisation (WTO):
crore.
1. All the United Nations countries are
2. Small enterprises are those with
members of the WTO.
investments not more than Rs. 10 crore
and annual turnover not more than Rs 50
2. The General Council is the highest
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crore. decision-making body of the WTO.
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3. Medium enterprises are those with 3. One of the objectives of the WTO is to
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investments not more than Rs. 100 crore achieve the exchange rate stability in
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and annual turnover not more than Rs. different economies.

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500 crore. How many statements given above are not

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Which of the statements given above is/are

correct?
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correct?
D

(a) Only one

(a) 1 only
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(b) Only two

(b) 1 and 2 only 3
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(c) Only three

(c) 2 and 3 only
(d) None
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(d) 1, 2 and 3
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11. Consider the following statements regarding 14. In the context of the economy, consider the
the agricultural census in India: following statements:
1. In India, it is conducted every 5 years by 1. Gross national product (GNP) is obtained
the Ministry of Agriculture and Farmers by deducting net factor income from
Welfare. abroad from the gross domestic product
2. It is carried out as a Central Sector (GDP).
Scheme. 2. Net national product (NNP) is obtained
3. The first agricultural census in India was by deducting depreciation from gross
carried out during the first five-year plan. national product (GNP).
How many of the statements given above are Which of the statements given above is/are
correct? correct?
(a) Only one (a) 1 only
(b) Only two (b) 2 only
(c) All three (c) Both 1 and 2
(d) None (d) Neither 1 nor 2

12. Consider the following: 15. Consider the following statements regarding
1. Net Income from shipping services Minimum Support Price (MSP):
2. Net Income from tourism 1. MSP aims to protect farmers from market
3. Net Income from banking services fluctuations and thus prevent distress
How many of the above constitute Net Non- sales of crops by farmers.
Factor income in the Balance of Payment? 2. MSP is a legally guaranteed minimum
(a) Only one price offered by the government of India
(b) Only two for some of the food grain and
(c) All three commercial crops.
(d) None Which of the statements given above is/are
correct?
13. Consider the following statements regarding (a) 1 only
the Asian Infrastructure Investment Bank: (b) 2 only
1. It was founded with the purpose to act as (c) Both 1 and 2 O
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an alternative to the World Bank for (d) Neither 1 nor 2
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providing funds to its member countries.

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2. It is headquartered in Beijing. 16. Which of the following bodies/organizations

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3. It has permanent observer status in the was jointly involved in the development of
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deliberations of the United Nations the System of National Accounts (SNA),

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General Assembly. which is used to compile measures of

F

How many of the statements given above are economic activity globally?
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correct? (a) United Nations

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(a) Only one (b) Ministry of Statistics and Programme

(b) Only two 4 Implementation
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(c) All three (c) United States Federal Bank

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(d) None (d) World Economic Forum

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17. In the context of economy, which of the 19. Consider the following pairs:

following statements best describes the term Method Meaning

“Green GDP”? 1. Follow on : A listed company

Public Offer comes out with a
(a) Contribution of the renewable energy
fresh issue of shares
sector in GDP.
2. Preferential : Procedure of bulk
(b) Contribution of biodiversity in economic
issue allotment of fresh
growth.
shares to a specific
(c) Colour-coded method of GDP
group of individuals,
calculation by United Nations.
venture capitalists
(d) GDP calculation after adjusting for etc
environmental damage. 3. Rights Issue : Issue of shares to
existing equity

18. As per "Jobs for Resilience, South Asia shareholders in

Development Update” released by the World proportion to their

Bank, the South Asia region including India existing

shareholding
is not reaping its demographic dividend. In
How many of the pairs given above are
this context consider the following:
correctly matched?
1. Exceptionally low share of women in
(a) Only one
employment
(b) Only two
2. Weak employment trends in non-
(c) All three
agricultural sectors (d) None
3. Employment ratio of the region is

relatively lower than other emerging 20. Consider the following: O

C
economies 1. Increase in Repo rate by the RBI
S.

2. Decrease in direct tax rates

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4. Narrow demographic window, which is

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to exist only till 2035 3. Decrease in export of items such as

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agricultural crops.
How many of the above may be the causes for
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How many of the above will help in

such a trend?
F

controlling the inflation?

D

(a) Only one

(a) Only one
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(b) Only two

5 (b) Only two
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(c) Only three

(c) All three
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(d) All four

(d) None
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21. Consider the following statements regarding 24. Consider the following:
Insurance Sector in India: 1. Gross Fiscal Deficit is obtained by
1. India's insurance penetration is more than excluding both revenue receipts and non-
10 percent of GDP. debt creating capital receipts from total
2. The FDI limit in the insurance sector is at expenditure.
51%. 2. The primary deficit is gross fiscal deficit
3. Insurance density in India is more than minus gross interest liabilities.
20000 rupees.
Which of the statements given above is/are
How many of the above statements are
correct?
correct?
(a) 1 only
(a) Only one
(b) 2 only
(b) Only two
(c) Both 1 and 2
(c) All three
(d) Neither 1 nor 2
(d) None

22. Consider the following statements regarding 25. Consider the following statements about the

the World Bank Group: Sovereign Gold Bonds (SGBs):

1. To join the World Bank Group, a country 1. These are issued by the RBI on behalf of
first needs to become a member of the the government.
International Monetary Fund (IMF). 2. The value of these bonds is tied to the
2. The International Bank for value of gold.
Reconstruction and Development 3. These are traded on both, the Bombay
(IBRD) offers interest-free loans to the Stock Exchange and the National Stock
world’s poorest countries. Exchange.
3. India is a member of all five institutions How many of the above statements
of the World Bank Group. are not correct?
How many of the statements given above are (a) Only one
correct? (b) Only two
(a) Only one
(c) All three
(b) Only two
(d) None
(c) All three
O
C
(d) None
26. Consider the following:
S.

1. Personal Income
23. Consider the following actions of RBI:
E

2. Goods production within the country

1. Decreasing Interest Rates
T

3. Imports from other countries

2. Increasing Reserve requirements
O

3. Selling government bonds 4. Fees on services rendered by the

N

How many of the above are likely actions of government

F

RBI during hawkish/ contractionary How many of the above can be sources of tax
D

monetary policy? revenue to the government?

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(a) Only one (a) Only one

6
(b) Only two (b) Only two
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(c) All three (c) Only three

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(d) None (d) All four

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27. Consider the following statements regarding 30. Which of the following governement body
the National Skill Development Corporation heads the "Indian Historical Records
NSDC: Commission" (IHRC)?
1. It is a not-for-profit public limited (a) Ministry of Education
company, fully owned by the (b) Archaeological Survey of India
government. (c) Indian Council for Cultural Relations
2. Ministry of Skill Development & (d) Union Minister of Culture
Entrepreneurship is the nodal agency.
3. Its main objective is to establish and run 31. Consider the following statements regarding
public institutions related to skill the Special Economic Zone (SEZ):
development. 1. SEZ operate under the provisions of
How many of the above statements are Special Economic Zones Act, 2005.
correct? 2. Both central and state governments have
(a) Only one the power to establish SEZ.
(b) Only two 3. It is deemed to be a foreign territory for
trade operations, duties and tariffs.
(c) All three
How many of the statements given above are
(d) None
correct?
(a) Only one
28. Consider the following statements regarding
(b) Only two
capital markets:
(c) All three
1. They deal in debt as well as equity
(d) None
instruments.
2. Certificate of deposits and commercial
32. Consider the following:
papers are securities traded in the capital
1. Price stability
markets.
2. Economic Growth
3. Public participation is limited in capital
3. Employment generation
markets compared to the money market.
How many of the above are the objectives of
How many of the above statements are
fiscal policy?
correct?
(a) Only one
(a) Only one (b) Only two
(b) Only two
(c) All three
(c) All three
(d) None O
C
(d) None
S.

33. Which of the following is/are forms of narrow

E

29. Consider the following situations: money?

T

1. Decrease of interest rates in India. 1. Currency notes

O

2. Decrease in demand for foreign goods. 2. Demand deposits held by commercial

3. Expectations of future appreciation of
N

banks
foreign currency. 3. Net time deposits of commercial banks
F

How many of the above situations could lead Select the correct answer using the code given
D

to the appreciation of the Indian rupee? below.

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(a) Only one (a) 1 only

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(b) Only two (b) 1 and 2 only
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(c) All three (c) 2 and 3 only

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(d) None (d) 1, 2 and 3

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W

8
W
W
.P
D
F
N
O
T
E
S.
C
O
W

9
W
W
.P
D
F
N
O
T
E
S.
C
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46. Which of the following funds receives the 49. Fair and Remunerative Price (FRP) is a
proceeds from the disinvestment of Central guaranteed price set by the government to
Public Sector Enterprises (CPSEs) in India? ensure fair compensation to farmers for the
cultivation of which of the following crops?
(a) National Investment and Infrastructure
(a) Rice
Fund (NIIF)
(b) Sugarcane
(b) National Development Fund (NDF)
(c) Cotton
(c) National Investment Fund (NIF) (d) Minor Forest Produce
(d) India Infrastructure Project Development
Fund (IIPDF) 50. Prasanta Chandra Mahalanobis, also known
as the architect of Indian Planning, was
47. With With reference to Child Care Leave responsible for formulating which of the
following five-year plans?
(CCL) under Central Civil Services (Leave)
(a) First Five Year Plan
Rules, 1972, consider the following
(b) Sixth Five Year Plan
statements:
(c) Second Five Year Plan
1. Female employees under the age of 18 (d) Fifth Five Year Plan
years are allowed CCL of 1 year to look
after their children. 51. Consider the following situations:
2. There is no age limit in the case of a 1. A decrease in the repo rate leads to a
differently abled child. decrease in the money supply in an
economy.
3. Denying a woman's Child Care Leave is
2. An increase in the repo rate leads to a
a violation of the constitution.
decrease in the prices of goods
How many of the above statements are (Inflation).
correct? Which of the above situations is/are an
(a) Only one Efficient Monetary Policy Transmission in an
(b) Only two economy?
(c) All three (a) 1 only
(d) None (b) 2 only
(c) Both 1 and 2

48. Consider the following statements regarding

(d) Neither 1 nor 2
O
C
the Securities and Exchange Board of India 52. Consider the following:
S.

(SEBI): 1. Increase in agricultural production and

E

1. It is a statutory body. productivity

T

2. It regulates all intermediaries in stock 2. Excessive Usage of Chemicals

O

exchanges like share brokers, 3. Monocropping

N

underwriters and mutual funds. 4. Depletion of Groundwater.

How many of the above were the
F

Which of the statements given above is/are

consequences of the Green Revolution in
D

correct?
India?
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(a) 1 only (a) Only one

(b) 2 only 10
(b) Only two
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(c) Both 1 and 2 (c) Only three

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(d) Neither 1 nor 2 (d) All four

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53. Consider the following statements regarding 57. The term "Doxxing," often mentioned in the
micro-insurance in India: news, is primarily associated with:
1. It aims to promote insurance coverage (a) cybersecurity measures against online
among economically vulnerable sections hacking.
of society. (b) development of encryption technologies
2. It is regulated by the Reserve Bank of
for secure communication.
India (RBI).
(c) legal procedures for copyright
3. Micro insurance can include both general
protection.
insurance policies as well as life
(d) unauthorized sharing of personal or
insurance policies.
private information on the internet.
How many of the above statements are
correct?
(a) Only one 58. The ASPIRE Scheme is primarily associated
(b) Only two with which of the following objectives of the
(c) All three Government of India?
(d) None (a) Skill development centers for rural youth
(b) Technology and incubation centers for
54. When people are employed in a job where fostering entrepreneurship in the agro-
their presence or absence does not make any industry
difference is known as: (c) Registration and recognition of Micro,
(a) Opportunity cost of employment
Small and Medium Enterprises (MSMEs)
(b) Underemployment
(d) Promote public-private partnerships in
(c) Informal employment
infrastructure development
(d) Disguised unemployment

59. Consider the following statements about the

55. Consider the following pairs:
Military Exercise Nations involved Climate Technology Centre and Network
1. Tiger Triumph : India and the US (CTCN):
2. DUSTLIK : India and 1. It was established at the UN Framework
Uzbekistan Convention on Climate Change Paris
3. Lamitiye : India and summit in 2016.
Seychelles
How many of the above pairs are correctly O
2. The main goal of the CTCN is to foster
the transfer of climate technologies for
C
matched? low-carbon and climate-resilient
S.

(a) Only one pair development.

E

(b) Only two pairs

3. CTCN is the implementation arm of the
T

(c) All three pairs

Technology Mechanism of the UN
O

(d) None of the pairs

Framework Convention on Climate
N

Change.
56. Which of the following establishes the
F

How many of the statements given above are

inversely proportional relation between
D

inflation and unemployment rate? correct?

.P

(a) Laffer curve (a) Only one

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(b) Philips curve (b) Only two
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(c) Lorenz curve (c) All three

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(d) Kuznets curve (d) None

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60. Which of the following organizations publish 63. With reference to the Crystal Maze 2,
the World Development Report? consider the following statements:
1. It is an advanced air-launched missile
(a) International Monetary Fund (IMF)
developed by India under Make in India
(b) The World Bank Group initiative.
(c) World Economic Forum (WEF) 2. It is capable of hitting a target over 250
kilometers away.
(d) United Nations Conference on Trade and
3. It is designed to target high-value
Development (UNCTAD) movable and relocatable assets like
fighter aircraft.
61. Consider the following statements regarding How many of the statements given above are
correct?
the 'White label ATMs':
(a) Only one
1. They can accept and service all bank (b) Only two
customers by charging fees. (c) All three
(d) None
2. They are owned and operated by the
National Payments Corporation of India 64. Which of the following reports given below
(NPCI). are published by the International Monetary
Fund (IMF)?
Which of the statements given above is/are
1. World Economic Outlook
correct?
2. Global Economic Prospects report
(a) 1 only 3. The Fiscal Monitor
(b) 2 only Select the correct answer using the code given
below.
(c) Both 1 and 2
(a) 1 and 2 only
(d) Neither 1 nor 2 (b) 2 and 3 only
(c) 1 and 3 only
(d) 1, 2 and 3
62. Which of the following are the changes made
in government budgeting to make it more 65. With reference to the Unified Payment
efficient and effective?
O
Interface (UPI), consider the following
statements:
C
1. Restructuring of Centrally Sponsored
1. The UPI Lite app can only hold a
S.

schemes
maximum of Rs 2000 at a time.
E

2. Merger of Railway and General budget 2. Users are not required to enter their UPI
T

3. Classification into Plan and Non-Plan PIN to confirm UPI Lite payments.
O

3. UPI allows users to deposit cash at Cash

classification
N

Deposit Machines without using a

Select the correct answer using the code given debit/credit card.
F

below. How many of the statements given above are

D

(a) 1 and 2 only correct?

.P

(a) Only one

(b) 2 and 3 only 12
(b) Only two
W

(c) 1 and 3 only (c) All three

W

(d) 1, 2 and 3 (d) None

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66. Which of the following is not a part of India’s 70. The concept of Buffer stock of grains was
annual budget as mandated by the Fiscal introduced during which of the following
Responsibility and Budget Management Act, five-year plans?
2003? (a) First Five-year plan
(a) Financial Stability Report (b) Third Five-year plan
(b) Medium-term Fiscal Policy Statement (c) Fourth Five-year plan
(c) Fiscal Policy Strategy Statement (d) Eleventh Five-year plan
(d) Macroeconomic Framework Statement

67. Consider the following statements with 71. With reference to the Kalvari Class
reference to National Accounts Statistics: Submarine, consider the following
1. At present, the Central Statistical Office statements:
(CSO) uses 2014-15 as the base year. 1. Kalvari Class submarines feature
2. In calculating the real and nominal GDPs nuclear-powered propulsion systems.
of the current year, the production 2. The Kalvari Class submarines are built as
volume is fixed. a part of the collaboration between India
Which of the statements given above is/are and Russia.
correct? Which of the statements given above is/are
(a) 1 only correct?
(b) 2 only (a) 1 only
(c) Both 1 and 2 (b) 2 only
(d) Neither 1 nor 2
(c) Both 1 and 2
68. Consider the following statements about (d) Neither 1 nor 2
Masala Bonds:
1. Masala bonds are debt instruments issued 72. The term 'Vasuki indicus' is often mentioned
in the Indian capital market. in the news in reference to
2. They aim to raise funds to support private (a) a fossil of a kind of venomous snake
sector infrastructure development found in India.
initiatives in India. (b) a newly discovered amphibian species in
Which of the statements given above is/are the Western Ghats.
correct? (c) a medicinal plant found exclusively in the
(a) 1 only Himalayas.
(b) 2 only
(c) Both 1 and 2
East India. O
(d) an early human species found in North-
C
(d) Neither 1 nor 2
S.

73. Consider the following statements:

69. Consider the following statements:
E

1. Inflationary gap refers to a situation

1. The Drought Prone Area Development
T

where aggregate demand is less than the

Programme (DPAP) was launched during
O

productive capacity of an economy.

the first five-year plan.
N

2. Increase in tax and reduction in transfer

2. The Rolling Plan was implemented after
payments can reduce the inflationary gap.
F

the rejection of the fifth five-year plan.

Which of the statements given above is/are
D

Which of the statements given above is/are

correct? correct?
.P

(a) 1 only (a) 1 only

13
(b) 2 only
W

(b) 2 only
(c) Both 1 and 2 (c) Both 1 and 2
W

(d) Neither 1 nor 2 (d) Neither 1 nor 2

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74. Consider the following foreign Investments: 77. Consider the following statements regarding
1. A foreign manufacturer acquiring an Outcome Budgeting:
interest in an Indian company that 1. It gives project-wise outlays for all
supplies it with the raw materials it needs. ministries against outcomes listed during
2. A foreign company invests in an Indian the year.
business that is unrelated to its core 2. The outcomes are expected results not
business. only in terms of monetary units or
physical infrastructure but also in terms
3. A foreign company establishes the same
of qualitative targets and achievements.
type of business operation in India as it
Which of the statements given above is/are
operates in its home country.
correct?
Which of the above is/are considered as
(a) 1 only
horizontal FDI coming into India?
(b) 2 only
(a) 1 and 3 only (c) Both 1 and 2
(b) 1 only (d) Neither 1 nor 2
(c) 3 only
(d) 1 and 2 only 78. With reference to the Koodiyattam art form,
consider the following statements:
75. Consider the following: 1. It is a Sanskrit theatre tradition of Kerala.
1. Economic growth 2. It is performed by the Chakyar
2. Modernisation community.
3. Self-reliance 3. It has been included in UNESCO's
4. Equity Intangible Cultural Heritage list.
How many of the above were the primary How many of the above statements are
goals of the Five-year Plans in India? correct?
(a) Only one
(a) Only one
(b) Only two
(b) Only two
(c) All three
(c) Only three
(d) None
(d) All four

79. Consider the following statements regarding

76. Recently, AstraZeneca for the first time aviation sector in India:
admitted that its COVID-19 vaccine 1. The civil aviation sector contributes less
(Covishield) had rare side effects including than 3% to the GDP. O
C
Thrombosis with Thrombocytopenia 2. Director General of Civil Aviation
S.

Syndrome (TTS). In this regard, which of the (DGCA) is the regulatory body in the
following statements best describes the term field of civil aviation.
E

'Thrombosis'? 3. Regional Connectivity Scheme-Ude

T

(a) It is a rare condition in which blood clots Desh ka Aam Nagrik (UDAN) will be
O

form in unusual places in the body. applicable on flights which cover

N

(b) It is a condition in which a decrease in distance between 200 km and 1200 km

F

bone density occurs that affects elderly only.

D

populations. How many of the above statements are

correct?
.P

(c) The contraction of muscles in the heart

14 (a) Only one
leads to a heart attack.
W

(b) Only two

(d) It is a condition in which inflammation of
(c) All three
W

the veins is caused by viral infections.

(d) None
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80. With reference to elections in India, consider 84. Consider the following statements regarding
the following: the Asian Development Bank (ADB):
1. Damage to EVMs 1. India is among the top five largest
2. Booth-capturing shareholders of ADB.
3. Natural disasters 2. At present, it has more than 100
How many of the above are valid reasons to
members.
declare a poll at a polling station void by the
3. It provides financing to only public sector
Election Commission of India?
projects and public-private partnership
(a) Only one
projects.
(b) Only two
How many of the statements given above are
(c) All three
(d) None correct?
(a) Only one
81. Recently, the Supreme Court has stayed the (b) Only two
construction of four proposed dams inside (c) All three
Kalesar Wildlife Sanctuary. In this context, in (d) None
which of the following states/union territories
of India the Kalesar Wildlife Sanctuary is 85. Consider the following statements regarding
situated? shipping sector in India:
(a) Punjab 1. Around 95 per cent of India's trade by
(b) Jammu and Kashmir
volume and 68 per cent in terms of value
(c) Haryana
is transported by sea.
(d) Rajasthan
2. Inland Water Transport (IWT) carries
less than 2 percent of India's organized
82. With reference to accounting, consider the
freight traffic.
following variables:
1. Income Which of the statements given above is/are
2. Profits correct?
3. Bank Balance (a) 1 only
4. Equity Shareholdings (b) 2 only
How many of the above are classified as flow (c) Both 1 and 2
variables?
(a) Only one
(d) Neither 1 nor 2
O
C
(b) Only two 86. Consider the following statements regarding
S.

(c) Only three the infrastructure sector of India:

E

(d) All four

1. Indian Railways is the fourth largest
T

network in the world lengthwise.

O

83. Which of the following was the primary

2. National Highways constituted about 10
N

objective of land reforms in India post-

percent of India's total road network.
independence?
F

Which of the statements given above is/are

(a) Redistribution of land to landless farmers
D

(b) Consolidation of fragmented land correct?

.P

holdings to boost the real estate sector (a) 1 only

15
(c) Promotion of the heavy indutries (b) 2 only
W

(d) Privatization of agricultural land to (c) Both 1 and 2

W

encourage commercial cultivation (d) Neither 1 nor 2

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87. Consider the following statements: 90. Consider the following statements:

1. An ad valorem tax is a tax based on the Statement-I: The benefits of public goods are
available to all and not restricted to a
assessed value of an item, such as real
particular consumer class.
estate or personal property.
Statement-II: Public goods are produced
2. The Goods and Services Tax is an ad exclusively by the government.
valorem tax. Which one of the following is correct in
respect of the above statements?
Which of the statements given above is/are
(a) Both Statement-I and Statement-II are
correct?
correct and Statement-II is the correct
(a) 1 only explanation for Statement-I
(b) 2 only (b) Both Statement-I and Statement-II are
(c) Both 1 and 2 correct and Statement-II is not the correct
explanation for Statement-I
(d) Neither 1 nor 2
(c) Statement-I is correct but Statement-II is
incorrect
88. Consider the following statements regarding (d) Statement-I is incorrect but Statement-II
the Financial Intelligence Unit (FIU) of India: is correct

1. It functions under the direct jurisdiction

91. Consider the following:
of the Ministry of Home Affairs.
1. Accepting Demand deposits
2. It is mandatory for banks in India to 2. Remittances Services
furnish monthly cash transaction reports 3. Providing Net Banking and fund transfer
to the FIU on transactions over Rs. 2.5 services
4. Providing Credit cards and loans to
lakh.
unserved and underserved sections
Which of the statements given above is/are
How many of the above services are provided
correct? by Payment Banks in India?
(a) 1 only (a) Only one
O
C
(b) 2 only (b) Only two
S.

(c) Only three

(c) Both 1 and 2
(d) All four
E

(d) Neither 1 nor 2

T

“Regenerative Blue Economy – Mapping the

O

92.
Blue Economy” report sometimes seen in the
N

89. Which one of the following is widely used as

news, was published by:
F

a ripening agent for fruits?

(a) World Bank
D

(a) Methanol
(b) International Union for Conservation of
.P

(b) Ethylene 16 Nature

W

(c) Propyl Alcohol (c) United Nations Environment Program

W

(d) Sodium carbonate (d) World Wide Fund for Nature

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93. Consider the following statements regarding 96. Consider the following statements regarding
Telecom Sector in India: the Goods and Service Tax (GST):
1. India is the world’s second-largest 1. It is a single comprehensive direct tax.

telecommunications market with a 2. It is a destination-based consumption tax

subscriber base of over a billion. applicable throughout the country.

Which of the statements given above is/are
2. Foreign direct investment of up to 74% is
correct?
allowed through the automatic route.
(a) 1 only
3. The 5G network has been rolled out in all
(b) 2 only
28 states and 8 UTs in India.
(c) Both 1 and 2
How many of the above statements are
(d) Neither 1 nor 2
correct?
(a) Only one 97. Consider the following pairs:
(b) Only two Term Meaning
(c) All three 1. Disinflation : Persistent fall in
(d) None prices
2. Deflation : Reduction in rate of
94. With reference to Lok Adalat, consider the inflation
following statements: 3. Reflation : Increase in price

1. It is one of the Alternative Dispute level during

economic recovery
Resolution (ADR) mechanisms.
How many of the pairs given above are
2. It has been granted statutory status under
correctly matched?
the Legal Services Authorities Act, 1987.
(a) Only one pair
3. The persons/members deciding cases in
(b) Only two pairs
the Lok Adalats act in a judicial capacity.
(c) All three pairs
How many of the statements given above are
(d) None of the pairs
correct?
(a) Only one 98. Consider the following pairs: O
C
(b) Only two Harvest Festivals States
S.

(c) All three 1. Bohag Bihu : West Bengal

E

(d) None 2. Puthandu : Tamil Nadu

T

3. Poila Boishak : Chattisgarh

O

95. The recently discovered 5,200-year-old 4. Vishu : Andhra Pradesh

N

Harappan settlement at "Padta Bet" is located How many pairs given above are correctly
F

in which of the following states? matched?

D

(a) Punjab (a) Only one pair

.P

(b) Gujarat 17 (b) Only two pairs

W

(c) Rajasthan (c) Only three pairs

W

(d) Haryana (d) All four pairs

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99. Consider the following statements regarding
Consumer Price Index (CPI):
1. CPI measure changes over time in
general level of prices of goods and
services that households acquire for the
purpose of consumption.
2. All the existing four types of CPI have
been placed at same base year for the sake
of uniformity.
Which of the statements given above is/are
correct?
(a) 1 only
(b) 2 only
(c) Both 1 and 2
(d) Neither 1 nor 2

100. Consider the following statements:

1. Labour force includes all the people in the
working age group of 15 to 59 years.
2. Worker population ratio is defined as the
percentage of employed persons in
population.
3. Unemployment rate is the percentage of
persons unemployed among the persons
in the labour force.
How many of the statements given above are
correct?
(a) Only one
(b) Only two
(c) All three O
C
(d) None
S.
E
T
O
N
F
D
.P

18
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 VISIONIAS
www.visionias.in
ANSWERS & EXPLANATIONS
GENERAL STUDIES (P) TEST – 4707 (2025)

Q 1.D
• The Regional Rural Banks (RRBs):
o The Regional Rural Banks (RRBs) were established in 1975 under the provisions of the Ordinance
promulgated on 26th September 1975 and the Regional Rural Banks Act, 1976.
o The RRBs combine the characteristics of a cooperative in terms of familiarity of rural problems and a
commercial bank in terms of its professionalism and ability to mobilize financial resources.
• Ownership Structure:
o RRBs are tripartite institutions jointly set up by:
o Central Government: Contributes 50% of the initial share capital.
o State Government: Contributes 15% of the initial share capital.
o Sponsor Bank (Public Sector Bank): Contributes 35% of the initial share capital and provides
management expertise.
o Hence statement 1 is not correct.
• Regulation and Supervision:
o RRBs are regulated by the Reserve Bank of India (RBI), the central banking authority in India.
o They are also supervised by the NABARD (National Bank for Agriculture and Rural
Development) at the regional level and by the State Governments at the operational level. Hence
statement 2 is not correct.
• Function and Objectives:
o The primary objective of RRBs is to provide credit and other banking services to the rural population,
particularly farmers, artisans, small entrepreneurs, and rural households.
o They facilitate agricultural and rural development by extending credit for agricultural activities, rural
industries, and other priority sectors.
• Priority Sector Lending Target:
o RRBs are mandated to fulfill a certain percentage of their total lending to priority sectors, as defined
by the RBI.
o As per RBI guidelines, the priority sector lending target for RRBs is currently set at 75% of
their Adjusted Net Bank Credit (ANBC). Hence statement 3 is not correct. O
C
Q 2.A
S.

• The Government finances its Budgetary deficits either by taxation, borrowing or printing money.
E

The borrowing of money gives rise to government debt. This borrowing helps the
government transfer the burden of reduced consumption on future generations. This is because it
T

borrows by issuing bonds to the people living at present but may decide to pay off the bonds years
O

later by raising taxes.

• Traditionally, it has been argued that when a government cuts taxes and runs a budget
N

deficit, consumers respond to their after-tax income by spending more.

F

• A counter argument is that consumers are forward-looking and will base their spending not only on their
D

current income but also on their expected future income. They will understand that borrowing today
means higher taxes in the future. Further, the consumer will be concerned about future
.P

generations because they are the children and grandchildren of the present generation. They would
increase savings now, which will fully offset19 the increased government dissaving so that national savings
W

do not change.
W

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 • David Ricardo, one of the greatest nineteenth century economists, first argued that in the face of high
deficits, people save more. He gave the "Ricardian equivalence" which discusses that taxation and
borrowing are equivalent means of financing expenditure. When the government increases spending
by borrowing today, which will be repaid by taxes in the future, it will have the same impact on the
economy as an increase in government expenditure that is financed by a tax increase today. Hence
option (a) is the correct answer.

Q 3.C
• GDP measures the monetary value of final goods and services—that is, those that are bought by the
final user—produced in a country in a given period (say, a quarter or a year).
o It counts all of the output generated within the borders of a nation.
o GDP is composed of goods and services produced for sale in the market and includes nonmarket
production, such as defense or education services provided by the government.
• An alternative concept, gross national product, or GNP, counts all the output of the residents of a
country. While GDP limits its interpretation of the economy to the geographical borders of the
country, GNP extends it to include the net overseas economic activities performed by its nationals.
Thus the Japanese company's output would be included in India's GDP and Japan's GNP.
• Hence option (c) is the correct answer.

Q 4.C
• Broad money = Narrow money + time deposits held by commercial banks and post office savings
organisation.
• At any point of time, the money held with the public has two most liquid components:
o Currency Component: This consists of all the coins and notes in the circulation.
o Demand Deposit Component: Demand Deposit component is the money of the general public with
the banks, which can be withdrawn by them using cheques, withdrawals, ATMs etc.
• The above two components are of Narrow Money. It is denoted by RBI as M1. It is the most liquid
part of the money supply because the demand deposits can be withdrawn anytime during the banking
hours.
• Time deposits have a fixed maturity period and hence cannot be withdrawn before expiry of this
period.
• M3 or Broad Money is therefore calculated as Narrow Money + Time Deposits of public with
banks. Hence option (c) is the correct answer.
• Broad money does not include the interbank deposits of public with all banks including the cooperative
banks.
• Cash Reserves of the Banks held with RBI is counted under M0 i.e. the monetary base.

Q 5.B
• The Hybrid Annuity Model (HAM) has been introduced by the Government to revive PPP(Public Private
Partnership) in highway construction in India. At present, three different models -PPP Annuity, PPP Toll
and EPC(Engineering, Procurement and Construction) were followed by the government while adopting
private sector participation. HAM is a mix of BOT Annuity and EPC models.
• The Build Operate and Transfer(BOT) Annuity Model: Under this, a developer builds a highway, O
C
operates it for a specified duration and transfers it back to the government. The government starts
S.

payment to the developer after the launch of the commercial operation of the project. Payment will be
made on a six-month basis.
E

• BOT Toll Model: In this toll-based BOT model, a road developer constructs the road and he is allowed to
T

recover his investment through toll collection. This toll collection will be over a long period which is
O

nearly 30 years in most cases. There is no government payment to the developer as he earns his money
invested from tolls.
N

• Engineering, Procurement and Construction (EPC) Model: Under this model, the cost is completely
F

borne by the government. The government invites bids for engineering knowledge from private players.
Procurement of raw materials and construction costs are met by the government. The private sector's
D

participation is minimal and is limited to the provision of engineering expertise. A difficulty of the model
.P

is the high financial burden for the government. Hence, option (b) is the correct answer.
• Features of Hybrid Annunity Model (HAM): 20
W

o As per the design, the government will contribute to 40% of the project cost in the first five years
through annual payments (annuity). The remaining payment will be made based on the assets created
W

and the performance of the developer.

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 o Here, a hybrid annuity means the first 40% payment is made as a fixed amount in five equal
installments whereas the remaining 60% is paid as a variable annuity amount after the completion of
the project depending upon the value of assets created.
o As the government pays only 40%, during the construction stage, the developer should find money for
the remaining amount. Here, he has to raise the remaining 60% in the form of equity or loans.
o There is no toll right for the developer. Under HAM, Revenue collection would be the responsibility
of the National Highways Authority of India (NHAI).
• Advantages of HAM:
o It gives enough liquidity to the developer and the financial risk is shared by the government. While
the private partner continues to bear the construction and maintenance risks as in the case of the BOT
(toll) model, he is required only to partly bear the financing risk. The government’s policy is that the
HAM will be used in stalled projects where other models are not applicable

Q 6.A
• Treasury-Bills are zero coupon government securities that are issued at a discount and redeemed in face
value at maturity. The difference is the interest to the investor. Hence sattement 1 is correct.
• These are issued to address short term receipt-expenditure mismatches under the auction program of the
Government. These are primarily issued in three tenors, 91,182 and 364 day. Hence statement 2 is not
correct.

Q 7.D
• The Balance of Payments (BOP) :
o The Balance of Payments (BOP) of a country is a systematic record of all transactions in goods,
services, and assets (economic transactions) between residents of that country and the rest of the
world over a defined period, typically one year. Hence option (d) is the correct answer.
o It is an essential tool for understanding a country's economic interactions with other nations and
provides valuable insights into its international trade, financial flows, and overall economic health.
• The Balance of Payments comprises three main components:
o Current Account: This includes the trade balance (exports minus imports of goods), the balance of
services (such as tourism, transportation, and financial services), net income (such as interest and
dividends), and net transfers (such as foreign aid and remittances).
o Capital Account: This records transactions involving the purchase and sale of non-financial assets,
such as real estate and patents, as well as financial assets and liabilities, such as foreign direct
investment (FDI), portfolio investment, and loans.
o Financial Account: This tracks changes in a country's holdings of foreign assets and liabilities,
including official reserves, direct investment abroad, portfolio investment, and other investments.
• Explanation of incorrect statements:
o A comprehensive record of all economic transactions between the Government of a country and the
governments of the rest of the world over a specific period: This statement is incorrect because the
Balance of Payments includes transactions not only between governments but also between
residents and non-residents, including private sector entities.
o A statistical analysis of a country's domestic budget, including government expenditures and tax O
C
revenues: This statement is incorrect because the Balance of Payments focuses on international
transactions, whereas a country's domestic budget pertains to its internal fiscal operations and does
S.

not encompass transactions with foreign entities.

o A measure of a country's net foreign exchange reserves over a specific period: This statement is
E

incorrect because while the Balance of Payments does include information on a country's foreign
T

exchange reserves, it also covers a wide range of other economic transactions, including trade,
O

services, and financial flows.

N

Q 8.B
• MSMEs form the backbone of the Indian economy, contributing significantly to employment generation,
F

industrial production, and overall economic growth. These enterprises are engaged in the production,
D

manufacturing, processing, or preservation of goods and commodities.

.P

• Classification of MSMEs:
• MSMEs in India are classified based on their 21 investment in plant and machinery or equipment, along with
W

their annual turnover. The current classification is as follows:

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 o Micro Enterprises: Investment not more than Rs.1 crore and Annual Turnover; not more than Rs. 5
crore. Hence, statement 1 is correct.
o Small Enterprises: Investment not more than Rs.10 crore and Annual Turnover; not more than Rs. 50
crore. Hence, statement 2 is correct.
o Medium Enterprises: Investment not more than Rs.50 crore and Annual Turnover; not more than Rs.
250 crore. Hence, statement 3 is not correct.

Q 9.A
• Foreign investment refers to deploying capital from one country into another, typically to establish a
lasting interest or gain financial returns. It can take various forms, including Foreign Direct
Investment (FDI) and Foreign Portfolio Investment (FPI):
• Foreign Direct Investment (FDI) is the investment through equity instruments by a person resident outside
India (a) in an unlisted Indian company, or (b) in 10 percent or more of the post-issue paid-up equity
capital on a fully diluted basis of a listed Indian company. Hence, statement 1 is correct.
• Foreign Portfolio Investment is any investment made by a person resident outside India in equity
instruments where such investment is (a) less than 10 percent of the post-issue paid-up equity
capital on a fully diluted basis of a listed Indian company or (b) less than 10 percent of the paid-up
value of each series of equity instruments of a listed Indian company.
• Post-issue paid-up equity capital refers to the total amount of equity capital that a company has after it
has issued new shares to investors in a public offering or rights issue. A fully diluted basis means the
total number of shares that would be outstanding if all possible sources of conversion are exercised.
• If an existing investment by a person resident outside India in equity instruments of a listed Indian
company falls below 10 percent of the post-issue paid-up equity capital on a fully diluted basis, the
investment will continue to be treated as FDI.
• FDI usually involves a long-term commitment by the investor, as they seek to establish a lasting presence
in the foreign market. This commitment may include transferring technology, expertise, and resources to
the foreign company to enhance its operations and competitiveness. The objective of FDI is not only to
generate financial returns but also to gain strategic advantages such as market expansion, access to new
technologies, and diversification of business operations across international markets.
• In contrast, FPI typically involves investing in financial assets such as stocks, bonds, and other
securities of foreign companies or governments. Their primary objective is to earn financial returns
through capital appreciation, dividends, or interest payments on their investments. Hence statement
2 is not correct.
Q 10.B
• The Bretton Woods Conference was held in 1944 to establish a new international economic order. The
conference's outcome was the Bretton Woods Agreement, which established the International Monetary
Fund (IMF), the World Bank Group, and GATT (General Agreement on Tariffs and Trade).
• In 1995, the WTO replaced GATT, which had been in existence since 1947, as the organization
overseeing the multilateral trading system. The government that had signed GATT was originally known
as GATT Contracting Parties. Upon signing the new WTO agreements, they officially became known as
WTO members. In 1994, 128 GATT signatories signed the WTO agreement. Later, other parties also
signed the WTO agreement and became its members. The latest addition was to Afghanistan in 2016.O
C
At present, there are 164 WTO members. Apart from these 164 countries, 24 countries as observer
governments are also there. On the other hand, the United Nations has 193 member countries. So, all
S.

the United Nations members are not the members of WTO. Hence statement 1 is not correct.
E

• WTO has four functional major bodies which are Ministerial Conference, the General Council, the
Dispute Settlement Body, and the Trade Policy Review Body. The WTO's highest decision-making
T

body is the Ministerial Conference, which is made up of all the WTO members. The conference meets at
O

least once every two years to provide direction for the organization and can make decisions on all the
N

matters under any of the WTO's multilateral trade agreements.

• The General Council is the WTO's highest-level decision-making body, which meets regularly to
F

carry out the functions of the WTO. It has representatives from all member governments and has the
D

authority to act on behalf of the Ministerial Conference. Hence statement 2 is correct.

• The main objective of the WTO is to provide a platform to member countries to negotiate trade
.P

agreements and lowering trade barriers. It also tried to promote fair competition with transparency and
encourages developments and economic reforms. 22 The mandate of ensuring exchange rate stability is
W

with another Bretton Wood institution which is International Monetary Fund (IMF). Hence
statement 3 is not correct.
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Q 11.B
• The Department of Agriculture and Farmers Welfare, Ministry of Agriculture & Farmers Welfare,
Government of India conducts Agriculture Censuses in India in collaboration with
States/UTs following standard concepts, definitions, and methodology. Agriculture Census in India is
conducted at an interval of five years following the broad guidelines of the decennial World Census of
Agriculture (WCA) evolved by the Food and Agriculture Organization (FAO) of the United
Nations. Hence, statement 1 is correct.
• The Agricultural Census is carried out as a Central Sector Scheme under which 100% financial
assistance is provided to States/Union territories. Hence, statement 2 is correct.
• The first Agriculture Census in India was conducted in 1970-71 during the fourth five-year
plan. The country has conducted ten Agriculture Censuses so far and the present census with the
reference year 2021-22 will be the 11th in the series. The entire Census operation is conducted in three
phases and operational holding is taken as statistical unit at micro level for data collection. Based on the
agriculture census data collected in three phases, the Department brings out three detailed reports
analyzing trends on various parameters at the All India and States/UTs levels. District/Tehsil level reports
are prepared by the respective States/UTs. Hence, statement 3 is not correct.

Q 12.C
• Balance of Payments (BOP) Components:
o The BOP is a comprehensive record of a country's economic transactions with the rest of the world
over a specific period. It's divided into three main accounts:
o Current Account: This account records a country's trade in goods and services, net income, and
unilateral transfers. Here's the breakdown of net income:
▪ Factor Income:
❖ This refers to income earned on factors of production (land, labor, capital) owned by residents
but used abroad. Examples include Profits earned by foreign subsidiaries of domestic
companies, Interest earned on foreign bonds held by domestic residents, and Wages earned by
domestic workers employed abroad (worker remittances).
▪ Non-Factor Income:
❖ This includes income earned from ownership of intangible assets or providing services that
are not directly tied to the production of goods. These are not considered factors of production
in the traditional sense.
❖ Net Non-Factor Income: Net Non-Factor Income is the difference between income received
from providing non-factor services to foreign residents and income paid to foreign residents
for similar services. Example include:
✓ Net Income from Shipping Services: When a domestic shipping company transports
goods for foreign clients, the income earned is not tied to the physical movement of goods
itself. It's a service provided that earns revenue. Hence option 1 is correct.
✓ Net Income from Tourism: Foreign tourists spending money in a country generates
income for that country's businesses. This income is not directly linked to the import or
export of goods but rather a service provided to tourists. Hence option 2 is correct.
✓ Net Income from Banking Services: When a domestic bank offers financial services to
O
foreign clients (e.g., interest on deposits, fees for transactions), the income earned is not
C
related to physical goods or services crossing borders. It's purely a financial
S.

service. Hence option 3 is correct.

Balance of Payment(BOP)
E
T
O
N
F
D
.P

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Q 13.B
• The Asian Infrastructure Investment Bank is a multilateral development bank to foster sustainable
economic development, create wealth and improve infrastructure connectivity in Asia by investing
in infrastructure and other productive sectors. It also helps in promoting regional cooperation and
partnership in addressing developmental challenges. The AIIB is headquartered in Beijing and began
operation in 2016. Hence statement 2 is correct.
• The membership of this bank is open to members of the International Bank for Reconstruction and
Development or the ASEAN Development Bank. It has 109 members worldwide and is capitalized at
USD 100 billion. Its membership is open to both sovereign and non-sovereign entities. But in case of
non-sovereign entity, the inclusion is depended upon the other sovereign members.
• As a multilateral development bank, it focuses on providing investment in infrastructure and other
productive sectors to foster sustainable economic development, create wealth, and improve infrastructure
connectivity. It is working in close cooperation with the International Bank for Reconstruction and
Development (a principal organ of the World Bank Group) to provide financial, technical, and
other assistance to improve the standard of life in developing countries. It helps in reinforcing the
goal of the World Bank rather than working as an alternative to the World Bank. Hence statement
1 is not correct.
• In 2018, AIIB was granted permanent observer status in the deliberations of both the United
Nations General Assembly and the Economic and Social Council. It has strengthened its credibility and
voice at the global level. Hence statement 3 is correct.

Q 14.B
• Gross Domestic Product measures the aggregate production of final goods and services within the
domestic economy during a year. But the whole of it may not accrue to the country's citizens. The
macroeconomic variable that considers such adjustment of foreigners and citizens is known as the Gross
National Product (GNP).
• GNP = GDP + Factor income earned by the domestic factors of production employed in the rest of the
world – Factor income earned by the factors of production of the rest of the world employed in the
domestic economy.
• Hence, GNP = GDP + Net factor income from abroad (Net factor income from abroad = Factor income
earned by the domestic factors of production employed in the rest of the world – Factor income earned by
the factors of production of the rest of the world employed in the domestic economy). Hence statement 1
is not correct.
• A part of the capital gets consumed during the year due to wear and tear, which is called depreciation.
Naturally, depreciation does not become part of anybody’s income. If we deduct depreciation from GNP
the measure of aggregate income that we obtain is called Net National Product (NNP). Thus NNP =
GNP – Depreciation. Hence statement 2 is correct.

Q 15.A
• Minimum Support Price (MSP) is the lowest rate at which government procurement agencies buy
crops from farmers. It shields farmers from market fluctuations, distress sales of crops, and offers
O
stability, and income security. The minimum support prices are announced by the Government of India
C
at the beginning of the sowing season for certain crops on the basis of the recommendations of the
Commission for Agricultural Costs and Prices (CACP). Hence, statement 1 is correct.
S.

• Currently, MSP is announced for 22 crops and FRP for sugarcane. These include:
E

• Kharif Crops: Paddy, Jowar, Bajra, Maize, Ragi, Tur (Arhar), Moong, Urad, Groundnut, Sunflower seed,
T

Soyabean, Sesamum, Niger seed and Cotton.

• Rabi Crops: Wheat, Barley, Gram, Masur (lentil), Rapeseed& mustard and Safflower.
O

• Commercial crops: Jute, Copra, and Sugarcane.

• In addition, MSP for toria and de-husked coconut is also fixed on the basis of MSPs of rapeseed &
N

mustard and copra respectively.

F

• However, as of now MSP isn’t a part of any legal statute and thus, it doesn’t confer any legal
D

guarantee. Hence statement 2 is not correct.

.P

24
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Q 16.A
• The System of National Accounts (SNA) developed by the United Nations is the internationally
agreed standard set of recommendations on compiling economic activity measures. The SNA
describes a coherent, consistent, and integrated set of macroeconomic accounts in the context of
internationally agreed concepts, definitions, classifications, and accounting rules.
• The System of National Accounts 2008 (2008 SNA) is a comprehensive, consistent and flexible set of
macroeconomic accounts to meet the needs of government and private-sector analysts, policy-makers,
and decisions-makers. It was prepared jointly by the International Monetary Fund, the European
Union, the Organization for Economic Co-operation and Development, the United Nations, and the
World Bank. These five organizations constitute the Inter-Secretariat Working Group on National
Accounts (ISWGNA). Hence option (a) is the correct answer.
• In addition, the SNA provides an overview of economic processes, recording how production is
distributed among consumers, businesses, governments, and foreign nations. It shows how income
originating in production, modified by taxes and transfers, flows to these groups and how they allocate
these flows to consumption, saving, and investment. Consequently, the national accounts are one of the
building blocks of macroeconomic statistics, forming a basis for economic analysis and policy
formulation.
• The SNA is intended for use by all countries, having been designed to accommodate the needs of
countries at different stages of economic development. It also provides an overarching framework for
standards in other domains of financial statistics, facilitating the integration of these statistical systems to
achieve consistency with the national accounts.

Q 17.D
• Green GDP is generally used to express GDP after adjusting for environmental damage. The
System of National Accounts (SNA) is an accounting framework for measuring the economic
activities of production, consumption, and accumulation of wealth in an economy during a period of
time. When information on the economy's use of the natural environment is integrated into the system of
national accounts, it becomes green national accounts or environmental accounting.
• The process of environmental accounting involves three steps, viz. Physical accounting, Monetary
valuation, and integration with national Income/wealth Accounts. Physical accounting determines the
state of the resources, types, and extent (qualitative and quantitative) in spatial and temporal terms.
Monetary valuation is done to decide on its tangible and intangible components. Thereafter, the net
change in natural resources in monetary terms is integrated into the Gross Domestic Product to reach the
Green GDP's value.
• The report of the Committee Green National Accounts in India: A Framework, opines that the word green
GDP is a misnomer as it is about the wealth of the nation that one is referring to (not income) while
talking about accretion or depletion of natural resources.
• Hence option (d) is the correct answer.

Q 18.C
• As per "Jobs for Resilience, South Asia Development Update” released by the World Bank, the
South Asia region including India is not reaping its demographic dividend.
O
C
o Demographic dividend is increased economic growth potential that can result when the share of the
working-age population (15 to 64) is larger than non-working-age.
S.

o India is expected to enjoy this window for 37 years starting 2018 and up to 2055.
• Issues in harnessing demographic dividends-
E

o Jobless growth: Employment ratio (employment relative to total working-age population) is only
T

59%(2023) in South Asian countries, lower than in other emerging economies (~70%).
O

o Exceptionally low shares of women in employment.

o Weak employment trends in non-agricultural sectors.
N

o Private investment has slowed and growth is mainly driven by public investment.
F

o Slowing global growth and heightened risks.

• Hence, option (c) is the correct answer.
D
.P

Q 19.C
• The primary market, also known as the new25issue market, is where securities (such as stocks, bonds,
W

or other financial instruments) are issued and sold for the first time by companies or governments
directly to investors.
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 o This market facilitates capital formation by allowing issuers to raise funds for various purposes, such
as financing business expansion, funding new projects, or meeting financial obligations.
• Means of raising funds at Primary Market
o Initial Public Offering (IPO): It is a process when an unlisted company raises funds by offering its
shares to the public and consequently gets listed on a stock exchange.
o Follow on Public Offer (FPO): When a listed company comes out with a fresh issue of shares or
makes an offer for sale to the public to raise funds it is known as FPO. Hence pair 1 is correctly
matched.
▪ Note: It is an issuance of additional shares made by a company after an initial public
offering (IPO).
o Preferential issue: It refers to the procedure of bulk allotment of fresh shares to a specific group
of individuals, venture capitalists, companies, or any other person by any particular company
for fund raising. Hence pair 2 is correctly matched.
▪ Note: The preferential issue is neither a public issue nor a rights issue.
o Rights Issue: Issue of shares to existing Equity shareholders in proportion to their existing
shareholding. Hence pair 3 is correctly matched.
o Private Placement: When a company offers its securities to a small group of investors, it is called
private placement. Such securities may be bonds, stocks or other securities, and the investors can be
both individual and institutional.

Q 20.B
• Measures to control inflation:
o Contractionary monetary policy is now a more popular method of controlling inflation. The goal
of a contractionary policy is to reduce the money supply within an economy by increasing interest
rates. This helps slow economic growth by making credit more expensive, which reduces consumer
and business spending. Increasing the repo rate by the RBI makes loans costlier and in turn it
decreases spending wrestling inflation control. Hence option 1 is correct.
o Fiscal measures can be taken by the government to reduce inflation. It may include increase in
direct taxes, decrease indirect taxes, decrease in government spending through frugal
budgeting, etc. Hence option 2 is not correct.
o The government takes various administrative measures from time to time to control measures. Such
measures can be the banning of exports of certain items such as edible oil, onions, pulses, etc. It
can also strengthen PDS to control leakages. Also, measures to restrict hoarding and speculation
can lead to negating of artificial increases in prices. Hence option 3 is correct.

Q 21.D
• The insurance industry in India has witnessed an impressive growth rate over the last two decades driven
by the greater private sector participation and an improvement in distribution capabilities, along with
substantial improvements in operational efficiencies.
• India has 67 insurers of which 24 are life insurers, 26 are general insurers, 5 are stand-alone health
insurers, and 12 are re-insurers (March 2022)
• Insurance density in India has increased from $11.1 in 2001 to $91 (7559 rupees) in 2021 (Life
O
insurance- $69, Non life insurance – $22). Further, in 2022-23, the insurance density in India incresed
C
from $91 in 2021-22 to $92 in 2022-23. Hence statement 3 is not correct.
S.

• Insurance penetration in India has been steadily increasing (from 2.7% in 2000 to 4.2% of GDP in
2021). Hence statement 1 is not corerct.
E

• FDI limit in insurance increased from 49% to 74% in Budget 2021. Hence statement 2 is not
T

correct.
O

• India’s share in global life insurance market was 3.23% in 2021.

• The Indian Insurance market is expected to reach $200 Bn by 2027.
N

• Ayushman Bharat PM-JAY is the largest health assurance scheme in the world and is funded by the
F

Government.
D

Q 22.A
.P

• The World Bank was established in 1944 in the Bretton Wood Conference along with IMF and
GATT. The World Bank Group works with 26 developing countries to reduce poverty and increase shared
W

prosperity. It provides financing, policy advice and technical assistance to governments and focuses on
strengthening the private sector in the developing countries.
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 • To become a member of the World Bank, a country must first join the International Monetary
Fund (IMF). Hence statement 1 is correct.
• There are five organizations under the World Bank Group. These are the International Bank for
Reconstruction and Development (IBRD), the International Development Association (IDA), the
International Finance Corporation (IFC), the Multilateral Investment Guarantee Agency (MIGA), and the
International Centre for Settlement of Investment Disputes (ICSID).
o International Bank for Reconstruction and Development (IBRD): It offers assistance to middle-
income and poor, but creditworthy, countries. Before gaining membership in the other four WBG's
affiliates a country must be a member of the IBRD.
o The International Development Association (IDA) offers loans to the world's poorest countries.
These loans come in the form of "credits" and are essentially interest-free. Hence statement 2 is not
correct.
o The International Finance Corporation (IFC) works to promote private sector investments by both
foreign and local investors. The IFC also acts as an investor in capital markets and will help
governments privatize inefficient public enterprises.
o The Multilateral Investment Guarantee Agency (MIGA) supports direct foreign investment into a
country by offering security against the investment in the event of political turmoil.
o The International Centre for Settlement of Investment Disputes (ICSID) facilitates and works
toward a settlement in the event of a dispute between a foreign investor and a local country.
• India is not a member of the International Centre for Settlement of Investment Disputes (ICSID).
Hence statement 3 is not correct.
• The Indian Council for Arbitration in 2000 recommended India to refrain from becoming a
signatory to the ICSID because:
o The convention’s arbitration rules favor developed countries.
o ICSID rewards cannot be reviewed even if it violates India’s public policy.
o A foreign investor may encroach upon India’s sovereign right to regulate through the ICSID
Convention.

Q 23.B
• Monetary Policy: Contractionary and expansionary policies involve modification of the level of money
supply in an economy. An expansionary policy increases the supply of money in an economy. On the
other hand, a contractionary policy decreases the supply of a country’s currency.
o Expansionary Policy
▪ When central banks want to increase the money supply, they do the following:
❖ buy securities in the open market;
❖ reduce the discount rate. Hence option 1 is not correct.
❖ lower the reserve requirements.
o Contractionary Policy
▪ The effects of contractionary policies are the opposite of expansionary policies. They cause a
reduction in bond prices and an increase in interest rates. When the central bank wishes to lower
the money supply, it can do the following:
❖ sell securities(Government Bonds) in the open market; (Hence option 3 is correct)
❖ increase the discount rate; or O
C
❖ increase the reserve requirements of commercial banks. (Hence option 2 is correct)
S.

Q 24.A
• When a government spends more than it collects by way of revenue, it incurs a budget deficit. There are
E

various measures that capture government deficit and they have their own implications for the economy.
T

• Fiscal deficit is the difference between the government’s total expenditure and its total receipts
O

excluding borrowing.
• Gross fiscal deficit = Total expenditure – (Revenue receipts + Non-debt creating capital receipts);
N

where Non-debt creating capital receipts are those receipts which are not borrowings and,
F

therefore, do not give rise to debt. Hence statement 1 is correct.

• The borrowing requirement of the government includes interest obligations on accumulated debt. The goal
D

of measuring primary deficit is to focus on present fiscal imbalances. To obtain an estimate of borrowing
.P

on account of current expenditures exceeding revenues, we need to calculate what has been called the
primary deficit. It is simply the fiscal deficit minus
27 the interest payments.
W

• Gross primary deficit = Gross fiscal deficit – Net interest liabilities; where Net interest liabilities
consist of interest payments minus interest receipts by the government on net domestic lending.
W

Hence, statement 2 is not correct.

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Q 25.D
• The Sovereign Gold Bonds (SGBs) are a kind of government bonds issued by the RBI on behalf of the
Government. The issuance is on payment of rupees but denominated in grams of gold. Hence,
statement 1 is correct.
• The value of these bonds is tied to the value of gold. The redemption value at the time of maturity is not
a fixed sum, rather, the investor gets interest income and the prevailing price of gold. Hence, statement 2
is correct.
• Like G-secs, SGBs are also backed by a sovereign guarantee.
• The introduction of the Sovereign Gold Bonds was announced in the Union Budget 2015-16. Both,
the Bombay Stock Exchange and the National Stock Exchange started trading in sovereign gold
bonds from June 2016 onwards. Hence, statement 3 is correct.

Q 26.C
• Revenue receipts are those receipts that do not lead to a claim on the government. They are therefore
termed non-redeemable. They are divided into tax and non-tax revenues. Tax revenues, an important
component of revenue receipts, have for long been divided into direct taxes (personal income tax)
and firms (corporation tax), and indirect taxes like excise taxes (duties levied on goods produced
within the country), customs duties (taxes imposed on goods imported into and exported out of
India) and service tax. Other direct taxes like wealth tax, gift tax and estate duty (now abolished)
have never brought in a large amount of revenue and thus have been referred to as ‘paper taxes’.
• The redistribution objective is sought to be achieved through progressive income taxation, in which the
higher the income, higher is the tax rate. Firms are taxed on a proportional basis, where the tax rate is a
particular proportion of profits. With respect to excise taxes, necessities of life are exempted or taxed at
low rates, comforts and semi-luxuries are moderately taxed, and luxuries, tobacco and petroleum products
are taxed heavily.
• Non-tax revenue of the central government mainly consists of interest receipts on account of loans
by the central government, dividends and profits on investments made by the government, fees and
other receipts for services rendered by the government. Cash grants-in-aid from foreign countries
and international organizations are also included.
• Hence, option (c) is the correct answer.

Q 27.B
Recently, The mobility of Indian workers to Israel is being facilitated by the NSDC International as part of a
G2G (government-to-government) agreement.
• National Skill Development Corporation (NSDC)- It is a not-for-profit public limited company
incorporated on July 31, 2008, under section 25 of the Companies Act, 1956. NSDC was set up by
Ministry of Finance as a Public Private Partnership (PPP) model.
• NSDC was set up as part of a national skill development mission to fulfill the growing need in India for
skilled manpower across sectors and narrow the existing gap between the demand and supply of skills.
NSDC acts as a catalyst in skill development by providing funding to enterprises, companies, and

O
organizations that provide skill training. It also develops appropriate models to enhance, support, and
coordinate private sector initiatives. The Government of India through the Ministry of Skill
C
Development & Entrepreneurship (MSDE) holds 49% of the share capital of NSDC, while the
private sector has the balance 51% of the share capital. It is not fully owned by the government.
S.

Hence, statement 1 is not correct 2 is correct.

E

• Objective- To contribute significantly to the overall target of skilling up of people in India, mainly by
T

fostering private sector initiatives in skill development programmes and providing funding. Hence,
statement 3 is correct.
O
N

Q 28.A
• Capital markets refer to financial markets where long-term debt or equity-backed securities are bought
F

and sold. These markets facilitate the flow of capital between investors (such as individuals and
D

institutions) and entities that require financing (like corporations and governments).
• Various types of securities traded in capital markets include stocks (equities), bonds (debt
.P

securities), derivatives, and mutual funds. Hence statement 1 is correct.

28
• Key components of capital markets include
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 • Certificate of deposit and commercial papers come under Money Market. Hence statement 2 is not
correct.
o Commercial Paper
▪ Unsecured security.
▪ It is a short-term debt instrument issued by companies to raise funds generally for time period up
to one year.
▪ Issued at discount to their face value.
▪ Maturity: from 14 days to 1 year.
▪ One of most important sources of working capital finance for large firms.
o Certificate of deposit
▪ A Security/Bond which is issued by the Bank to depositors of funds.
▪ Similar to FDs but these are negotiable and tradable in money market.

• Public participation in capital markets is quite extensive, especially when considering the broader
range of investors and investment opportunities available in capital markets compared to the
money market.
o Money market primarily deals with short-term debt instruments and cash equivalents, catering more
to institutional investors, corporations, and financial institutions seeking low-risk investments for
liquidity management. While retail investors can participate in money market instruments like money
market funds, the scope and scale of public participation in capital markets are generally broader and
more inclusive.
• Hence statement 3 is not correct.

Q 29.A
• Exchange Rate Regimes: O
C
o Flexible Exchange Rate (Floating Rate): Market forces of supply and demand determine the exchange
S.

rate.
o Fixed Exchange Rate: The government sets the exchange rate and intervenes in the market to maintain
E

it.
T

o Managed Float: A mix of flexible and fixed exchange rates, with some government intervention.
• Factors Affecting Exchange Rate in a Flexible System:
O

o Demand and Supply of Currencies:

N

▪ An increase in demand for foreign goods (more rupees offered for foreign currency) leads to
depreciation of domestic currency.
F

▪ Decrease in demand for foreign goods (fewer rupees offered for foreign currency) leads to
D

appreciation of domestic currency. Hence option 2 is correct.

o Speculation:
.P

▪ Expectations of future appreciation of29Foreign currency can lead to increased demand for foreign
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currency in the present, causing its appreciation. This leads to the depreciation of Indian
Currency.
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 ▪ Example: If investors expect the pound to appreciate, they will demand more pounds, leading to
its appreciation and depreciation of the Indian Rupee. Hence option 3 is not correct.
o Interest Rates:
▪ High interest rates attract foreign investment, leading to an appreciation of the domestic currency.
▪ Low interest rates discourage foreign investment, leading to the depreciation of the domestic
currency. Hence option 1 is not correct.
▪ Investors move funds to countries with higher interest rates, causing exchange rate movements.
o Income Levels:
▪ An increase in income leads to an increase in consumer spending and imports.
▪ An increase in imports leads to the depreciation of domestic currency.
▪ An increase in exports can offset depreciation if exports grow faster than imports.

Q 30.D
Recently, the Indian Historical Records Commission (IHRC) adopted a New Logo and Motto.
• The new logo signifies the theme and uniqueness of IHRC entirely. The pages in the shape of lotus petals
represent IHRC as the resilient nodal institution for maintaining historical records. The Sarnath pillar in
the middle represents India's glorious past. Brown as the colour theme reinforces the organization's
mission of preserving, studying and honouring India's historical records.
• The motto translates as "Where history is preserved for the future." The motto holds great
significance for the IHRC and its work. The IHRC plays a vital role in identifying, collecting, cataloguing
and maintaining historical documents, manuscripts other sources of historical information. By doing so
the Commission ensures that valuable historical knowledge is conserved for future generations. The
motto, therefore, reflects the Commission's commitment to ensure the safeguarding of historical
documents and making these accessible for the benefit of present and future generations.
• About The Indian Historical Records Commission (IHRC)-
• It is an apex advisory body on archival matters and acts as an all-India forum of creators, custodians and
users of records to advise the Government of India on the management of records and their use for
historical research. Established in 1919, the IHRC is headed by the Union Minister of Culture.
• The IHRC plays a vital role in identifying, collecting, cataloguing and maintaining historical documents,
manuscripts other sources of historical information.
• Hence, option (d) is the correct answer.

Q 31.C
• The Special Economic Zones (SEZs) Policy was announced in April 2000 to overcome the shortcomings
experienced on account of the multiplicity of controls and clearances; the absence of world-class
infrastructure, and an unstable fiscal regime and to attract larger foreign investments in India. This policy
intended to make SEZs an engine for economic growth supported by quality infrastructure complemented
by an attractive fiscal package, both at the Centre and the State level, with the minimum possible
regulations.
• SEZs in India functioned from 1.11.2000 to 09.02.2006 under the provisions of the Foreign Trade Policy
and fiscal incentives were made effective through the provisions of relevant statutes. Special Economic
Zones operate under the provisions of the Special Economic Zones Act which was passed in 2005, and itO
C
came into force along with the SEZ Rules in 2006. Hence, Statement 1 is correct.
• A Special Economic Zone may be established under this Act, either jointly or severally by the
S.

Central Government, State Government, or any person for manufacture of goods or rendering
E

services or for both or as a Free Trade and Warehousing Zone. Hence statement 2 is correct.
• Approval mechanism:
T

o The developer submits the proposal for the establishment of SEZ to the concerned State Government.
O

o The State Government has to forward the proposal with its recommendation within 45 days from the
N

date of receipt of such proposal to the Board of Approval.

o The applicant also has the option to submit the proposal directly to the Board of Approval.
F

• SEZ is a specifically delineated duty-free enclave and is deemed to be a foreign territory for the purpose
D

of trade operations, duties and tariffs. Hence, Statement 3 is correct.

.P

Q 32.C
• According to the International Monetary Fund30(IMF), the fiscal policy is the use of government spending
W

and taxation to influence the economy. Governments typically use fiscal policy to promote strong and
sustainable growth and reduce poverty. The role and objectives of fiscal policy gained prominence during
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 the recent global economic crisis when governments stepped in to support financial systems, jump-start
growth, and mitigate the impact of the crisis on vulnerable groups.
• Objectives of Fiscal Policy in Indian context:
o Economic Growth: Fiscal Policy maintains the economic growth so that the economic goals are
achieved.
o Price Stability: Controls the price level of the country so that when the inflation is too high prices can
be regulated.
o Full employment: It aims to achieve full employment/near-full employment, as a tool to recover from
low economic activity. Hence, option (c) is the correct answer.

Q 33.B
• The total stock of money in circulation among the public at a particular point of time is called
money supply. RBI publishes figures for four alternative measures of money supply, viz. M1, M2, M3
and M4. They are defined as follows
o M1 = CU + DD
o M2 = M1 + Savings deposits with Post Office savings banks
o M3 = M1 + Net time deposits of commercial banks.
o M4 = M3 + Total deposits with Post Office savings organisations (excluding National Savings
Certificates) where, CU is currency (notes plus coins) held by the public and DD is net demand
deposits held by commercial banks. The word ‘net’ implies that only deposits of the public held by
the banks are to be included in money supply.
o The interbank deposits, which a commercial bank holds in other commercial banks, are not to
be regarded as part of money supply. M1 and M2 are known as narrow money. M3 and M4 are
known as broad money. These gradations are in decreasing order of liquidity. M1 is most liquid and
easiest for transactions whereas M4 is least liquid of all.

Q 34.B
• Global Alliance of National Human Rights Institutions (GANHRI)
o This is an independent, non-profit organization comprised of National Human Rights
Institutions (NHRIs) from around the world. Hence, statement 1 is not correct.
o NHRIs are state-funded bodies with a mandate to protect and promote human rights within their
respective countries.
o GANHRI acts as a platform for these institutions to collaborate, share best practices, and advocate for
stronger human rights protections globally.
o Headquarters: Geneva, Switzerland
• Vision: A world where everyone, everywhere, fully enjoys their human rights.
• GANHRI collaborates with the United Nations Development Programme (UNDP) and the Office of
the United Nations High Commissioner for Human Rights (OHCHR).
o GANHRI works closely with various UN agencies, including the Office of the High Commissioner
for Human Rights (OHCHR), the UN Development Program (UNDP), and the UN Global Compact.
• India is also a member. Hence, statement 2 is correct.
o As a member of GANHRI, India's National Human Rights Commission (NHRC) actively participates O
C
in the alliance's activities.
o Benefits for India:
S.

▪ Enhanced credibility: Being part of GANHRI enhances the credibility and international standing
E

of India's NHRC.
▪ Improved human rights protection: The collaboration and support within GANHRI contribute
T

to strengthening human rights protection mechanisms in India.

O

▪ Global impact: India can play a more significant role in shaping global human rights discourse
and initiatives through its involvement in GANHRI.
N

• GANHRI Sub-Committee on Accreditation (SCA) is responsible for evaluating NHRIs against a set
F

of internationally recognized standards known as the 1993 Paris Principles.

o These principles define the key characteristics of effective NHRIs.
D

• Based on its assessment, the SCA assigns one of three accreditation statuses to an NHRI:
.P

o A (Accreditation): Meets all the Paris Principles.

o B (Partial Accreditation): Meets most of the 31 Paris Principles but has minor deficiencies.
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Q 35.A
• Special Drawing Rights(SDR)
o The SDR is an international reserve asset created by the IMF to supplement the official reserves
of its member countries. Hence statement 1 is correct.
o The SDR is not a currency. It is a potential claim on the freely usable currencies of IMF members. As
such, SDRs can provide a country with liquidity.
o The value of the SDR is based on a basket of five major currencies - the US $, Euro, Chinese
renminbi (RMB), Japanese yen, and the British pound sterling. Hence statement 2 is not correct.
o The SDRs are allocated to the member countries in proportion to their quota subscriptions.
o SDRs being costless as it is just book entry in the Special Drawing Account of the IMF, are often
called paper gold.

Q 36.C
• Cost-push inflation is the decrease in the aggregate supply of goods and services stemming from an
increase in the cost of production. Cost-push inflation means prices have been "pushed up" by
increases in the costs of any of the four factors of production—labor, capital, land, or
entrepreneurship—when companies are already running at full production capacity. Companies
cannot maintain profit margins by producing the same amounts of goods and services when their costs are
higher and their productivity is maximized. The price of raw materials may also cause an increase in
costs. This may occur because of a scarcity of raw materials (Increase in administered prices such as
MSP increase), an increase in the cost of labor to produce the raw materials or an increase in the
cost of importing raw materials. The government may also increase taxes to cover higher fuel and
energy costs, forcing companies to allocate more resources to paying taxes. Also, hoarding and
speculation due to cartelization can also increase the cost of some inputs leading to inflation. Hence,
option (c) is the correct answer.
• Demand-pull inflation occurs when there is an increase in aggregate demand, categorized by the
four sections of the macroeconomy: households, businesses, governments, and foreign buyers. When
concurrent demand for output exceeds what the economy can produce, the four sectors compete to
purchase a limited amount of goods and services. The increase in aggregate demand that causes demand-
pull inflation can be the result of various economic dynamics. For example, an increase in government
spending can increase aggregate demand, thus raising prices. Another factor can be the depreciation of
local exchange rates, which raises the price of imports and, for foreigners, reduces the price of exports. As
a result, the purchasing of imports decreases while the buying of exports by foreigners increases. This
raises the overall level of aggregate demand, assuming aggregate supply cannot keep up with aggregate
demand as a result of full employment in the economy. Finally, if a government reduces taxes, households
are left with more disposable income in their pockets. This, in turn, leads to an increase in consumer
confidence that spurs consumer spending.
• Structural inflation occurs due to the operation of the structural weaknesses (supply bottlenecks,
lack of infrastructure, etc.) Infrastructure bottlenecks such as lack of proper roads, electricity,
water, etc can cause structural inflation. Apart from these, monsoonal fluctuations, a high number of
middlemen, and cartelization are some of the reasons for structural inflation.
Q 37.C
• National income (NI) can be subdivided into smaller categories which include personal income(PI) which
O
C
is part of the national income received by households.
S.

• Further out of NI, which is earned by the firms and government enterprises, a part of profit is not
E

distributed among the factors of production. This is called Undistributed Profits (UP). We have to deduct
UP from NI to arrive at PI, since UP does not accrue to the households.
T

• Similarly, Corporate Tax, which is imposed on the earnings made by the firms, will also have to be
O

deducted from the NI, since it does not accrue to the households. On the other hand, the households do
receive interest payments from private firms or the government on past loans advanced by them. And
N

households may have to pay interests to the firms and the government as well, in case they had borrowed
F

money from either. So, we have to deduct the net interests paid by the households to the firms and
government. The households receive transfer payments from government and firms (pensions,
D

scholarship, prizes, for example) which have to be added to calculate the Personal Income of the
.P

households.
• Thus, Personal Income (PI) = NI – Undistributed 32 profits – Net interest payments made by
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households – Corporate tax + Transfer payments to the households from the government and firms.
• Hence option (c) is the correct answer.
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Q 38.C
• Impact of inflation on various sectors of the economy:
• Reduction of purchasing power: Inflation erodes the value of money, meaning that the same
amount of money buys fewer goods and services over time. This reduces the purchasing power of
wage earners unless their wages increase at the same rate as inflation. Hence option 1 is correct.
• Recession: If inflation spurs consumers to cut spending too much. Less money in the economy means
lower revenues and potentially negative growth for businesses leading to recession.
• Cost of Capital: Interest rates tend to move in the same direction as inflation but with lags, because
interest rates are the primary tool used by central banks to manage inflation. But as inflation rises,
interest rates are increased leading to increase in cost of borrowing. This makes investment costly as
cost of capital raising increases. Hence option 2 is correct.
• Imports: Inflation makes imported goods cheaper and import increases.
• Currency Depreciation: In general, inflation tends to devalue a currency since inflation can be
equated with a decrease in a currency's buying power. As a result, countries experiencing high
inflation tend to also see their currencies weaken relative to other currencies. Hence option 3 is
correct.

Q 39.C
• Recent context- A trial court in Delhi denied interim bail to Bharat Rashtra Samithi (BRS) leader K
Kavitha in the Delhi excise scam case. In doing so, Judge Kaveri Baweja said that the key exception
in the bail provisions of the Prevention of Money Laundering Act (PMLA), which allows bail for
women, is not “obligatory” or “mandatory” for the court to follow.
• The Prevention of Money Laundering Act (PMLA) is a crucial piece of legislation in India enacted in
2002. Its primary goal is to combat money laundering and prevent its use for financing terrorism.
• Objectives of PMLA:
o Prevent and control money laundering.
o Confiscate and seize assets obtained from laundered money.
o Deal with any other issue connected with money laundering in India.
• Bail Provisions under PMLA:
o Unlike the Code of Criminal Procedure (CrPC) where the prosecution bears the burden of
proof, under PMLA, the burden of proving innocence rests on the accused. This makes
obtaining bail significantly more challenging. Hence, statement 1 is correct.
o This refers to the burden of proof placed on the person accused of a crime.
o Essentially, it means the accused is responsible for providing evidence and arguments to support their
claim for bail.
▪ This contrasts with the usual principle in criminal law, where the burden of proof lies with the
prosecution to prove the accused's guilt beyond a reasonable doubt.
• The Enforcement Directorate (ED) is the primary agency responsible for investigating offences
under the Prevention of Money Laundering Act, 2002 (PMLA) in India. Hence, statement 3 is
correct.
o Enforcement Directorate (ED)
O
▪ It is a specialized financial investigation agency responsible for enforcing economic laws and
C
fighting economic crime in India.
▪ It plays a central role in investigating and prosecuting cases under the PMLA.
S.

▪ Powers and Functions of ED under PMLA:

E

❖ Investigation: The ED investigates cases related to money laundering, foreign exchange

T

violations, and other economic offenses.

❖ Attachment of Assets: It has the authority to attach properties and assets believed to be
O

proceeds of crime. Hence, statement 2 is correct.

❖ Arrest and Prosecution: The ED can arrest individuals suspected of money laundering and
N

prosecute them in special PMLA courts.

F

❖ International Cooperation: The agency collaborates with international counterparts to tackle

D

cross-border money laundering activities.

• Preeti Chandra vs Directorate of Enforcement (June 14, 2023):
.P

• This case brought further clarity to the bail provisions under the PMLA.
o The court ruled that while the accused33has the right to seek bail, they must satisfy additional
W

conditions beyond the usual criminal cases.

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 ▪ The key qualifier cannot be a flight risk or pose a risk of tampering with witnesses to be
eligible for bail.
❖ A flight risk refers to the likelihood of a person, typically someone accused of a crime,
attempting to flee the country before their trial begins.

Q 40.C
• Gross Domestic Product measures the aggregate production of final goods and services within the
domestic economy annually. Of the final goods, we can distinguish between consumption goods and
capital goods. Goods like food and clothing and services like recreation that are consumed when
purchased by their ultimate consumers are called consumption goods or consumer goods. On the other
hand, capital goods are tools, implements, and machines used in production. Hence statement 1 is
correct.
• Net Investment = Gross investment – Depreciation. Part of our final output comprising capital goods
constitutes an economy's gross investment. These may be machines, tools, implements, buildings, office
spaces, storehouses, or infrastructure like roads, bridges, airports, or jetties. Deletion, made from the value
of gross investment to accommodate regular wear and tear of capital, is called depreciation.
• The net investment must be distinct from the commonplace notion of investment, which implies using
money to buy physical or financial assets. Thus, using the term investment to denote the purchase of
shares or property or even having an insurance policy has nothing to do with how economists define
investment. Investment for an economist is always capital formation, a gross or net addition to capital
stock. Hence statement 2 is correct.

Q 41.C
• Exchange Traded Currency Derivatives (ETCDs) are financial instruments traded on exchanges
that derive their value from underlying foreign exchange (forex) rates. Statement 1 is correct.
• Features of ETCDs:
o Centralized Trading: Traded on regulated exchanges, providing liquidity and transparency.
o Standardization: Contracts have predefined specifications, such as currency pair, contract size, and
expiration dates.
o Leverage: Allows investors to gain exposure to currency movements with relatively small capital
outlays.
o Hedging: Can be used to protect against potential currency losses in foreign currency exposures.
• The Reserve Bank of India (RBI) has decided to defer the implementation of the revised norms for
ETCDs.
o In January this year, the RBI released a new framework for hedging of foreign exchange risks, which
was to be implemented from April 5, 2024.
▪ The new norm allowed users to take positions (long or short) in the foreign exchange derivatives
market, without having to establish the existence of underlying exposure, up to a single limit of
$100 million equivalent across all currency pairs involving the rupee, put together, and combined
across all recognized stock exchanges.
o The RBI deferred the implementation of ETCD regulations until May 3, 2024, due to investor
concerns. O
C
o The deferment provides parties involved additional time to comply with the updated guidelines.
• Currency derivatives are financial instruments that derive their value from the underlying asset,
S.

which is a currency.
o Currency derivatives can be broadly categorized into two primary types:
E

▪ Futures contracts:
T

❖ Futures contracts establish a legally binding agreement to buy or sell a predetermined amount
O

of a specific currency at a specified exchange rate on a predetermined future date.

▪ Options contracts:
N

❖ Options contracts grant the buyer the right, but not the obligation, to buy or sell a specified
F

amount of a currency at a predetermined price on or before a specific future date, for which a
premium is paid upfront by the buyer to the seller.
D

• Exchange Traded Currency Derivatives (ETCDs) represent a specialized subset of currency

.P

derivatives designed for trading on a regulated stock exchange.

• Regulation: 34
W

o SEBI is the primary regulator for the securities market in India. It governs the listing, trading, and
clearing of ETCDs on stock exchanges.
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 o RBI can aslo establishes guidelines and oversees the overall framework for ETCDs.
o Hence, Statement 2 is correct.

Q 42.B
• Wholesale Price Index (WPI) measures the average change in the prices of commodities for bulk sale at
the level of early stage of transactions. The index basket of the WPI covers commodities falling under the
three major groups namely Primary Articles, Fuel and Power and Manufactured products.
• The prices tracked are ex-factory price for manufactured products, mandi price for agricultural
commodities and ex-mines prices for minerals. Weights given to each commodity covered in the
WPI basket is based on the value of production adjusted for net imports. WPI basket does not cover
services. Hence, statement 1 is not correct.
• The base year for the WPI is 2011-12. It is estimated by the office of the Economic Advisor under
the Ministry of Commerce and Industry. Indirect taxes are not included in estimating WPI. Also, it
does not account for the products of the unorganized sector of India. Hence, statements 2 and 3 are
correct.

Q 43.A
• The National Sample Survey Office (NSSO) is the principal source of data on employment/
unemployment. NSSO uses three different concepts to capture unemployment data:
o Usual Status Approach: The activity status of a person is determined on the basis of the activities
pursued by the person during the specified reference period. When the activity status is determined on
the basis of the reference period of the last 365 days preceding the date of the survey, it is known as
the usual activity status of the person. It captures long-term unemployment in the economy. Hence,
statement 1 is correct.
o Current weekly status: The activity status determined on the basis of a reference period of the
last 7 days preceding the date of survey is known as the current weekly status (CWS) of the
person. It captures both long-term open chronic unemployment and seasonal unemployment. Hence,
statement 2 is not correct.
o Current Daily Status: Under this approach, unemployment status of a person is measured for
each day in a reference week. A person having no gainful work even for 1 hour in a day is described
as unemployed for that day.
Q 44.B
• The National Pharmaceutical Pricing Authority (NPPA) is a government regulatory agency in India
responsible for controlling the prices of pharmaceutical drugs.
• Recently, NPPA has increased the price of some antibiotics and painkillers by 0.00551% starting
April 1 2024.
o The NPPA has also revised the ceiling prices of over 800 scheduled drug formulations. India
currently has about 400 essential medicine molecules and 960 formulations.
• NPPA was established by the Government of India in 1997 as an attached office of the Department
of Pharmaceuticals (DoP) under the Ministry of Chemicals & Fertilizers. Hence, statement 1 is
correct.
• The NPPA's primary function is to regulate the prices of pharmaceutical drugs that fall under the O
C
Drugs (Prices Control) Order (DPCO), 2013. Hence, statement 2 is correct.
• Its main goal is to ensure that essential medicines are available to the public at affordable prices while also
S.

allowing fair returns for manufacturers.

E

o Price Fixation:
▪ Essential Medicines: NPPA fixes the ceiling prices of essential medicines listed under the
T

National List of Essential Medicines (NLEM).

O

❖ These are drugs deemed crucial for public health.

▪ Non-Scheduled Drugs: For drugs not under NLEM, NPPA monitors and regulates prices to
N

prevent excessive profiteering.

F

o Price Monitoring: NPPA continuously tracks the prices of both scheduled and non-scheduled drugs
D

to ensure compliance with price regulations.

o Enforcement: The authority has the power to take action against companies that violate pricing
.P

norms, including imposing fines and penalties.

• National List of Essential Medicines (NLEM): 35
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o This list identifies essential medicines crucial for public health needs.
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 o The NLEM is revised periodically to include new drugs and remove outdated ones, ensuring it reflects
current healthcare priorities.
o Criteria for Inclusion: Medicines are included based on factors like disease burden, efficacy, safety,
cost-effectiveness, and public health relevance.
• The NPPA revises the prices of NLEM drugs annually based on the Wholesale Price Index (WPI).
Hence, statement 3 is incorrect.
o WPI reflects the average change in prices of goods at the wholesale level, indicating inflation trends.

Q 45.C
• New Industrial Policy, 1991 was launched on July 24, 1991, with the aim of empowering market forces
enhancing efficiency and addressing distortions and shortcomings in the nation's industrial structure built
over four decades. It aspired to elevate industrial efficiency to global standards and expedite overall
industrial growth through Liberalization, Privatization and Globalization (LPG).
• Features of New Industrial Policy
o De-reservation of the Public Sector: Sectors that were earlier exclusively reserved for the public
sector were reduced. However, the pre-eminent place of public sector in 5 core areas like arms and
ammunition, atomic energy, mineral oils, rail transport and mining was continued. Presently, only two
sectors- Atomic Energy and Railway operations- are reserved exclusively for the public
sector. Hence, statement 1 is correct.
o De-licensing: The Industrial Licensing Policy abolished the industrial licensing given to all industries
except for the 18 industries. There are only 4 industries at present related to security, strategic and
environmental concerns, where an industrial license is currently required-
▪ Electronic aerospace and defence equipment
▪ Specified hazardous chemicals
▪ Industrial explosives
▪ Cigars and cigarettes of tobacco and manufactured tobacco substitutes
o Liberalisation of Foreign Investment: This was the first Industrial policy in which foreign
companies were allowed to have a majority stake in India. In 47 high-priority industries, up to 51% of
FDI was allowed. For export trading houses, FDI up to 74% was allowed. Today, there are numerous
sectors in the economy where the government allows 100% FDI.
o Foreign Technology Agreement: Automatic approvals for technology-related agreements.
o Changes in the Standard for Small Units: The criteria for a tiny unit was changed to a unit having
an investment limit of Less than Rs. 5 Lakh.
o Establishment of National Renewal Fund: As per this policy, the government announced the
establishment of a National Renewal Fund (NRF) to ensure a social safety net for labour.
o Monopolistic and Restrictive Trade Practices (MRTP) Act was amended to remove the threshold
limits of assets in respect of MRTP companies and dominant undertakings. MRTP Act was replaced
by the Competition Act 2002. Hence, statement 2 is correct.

Q 46.C
• Disinvestment means sale or liquidation of assets by the government, usually Central and state
public sector enterprises, projects, or other fixed assets. The proceeds from the disinvestment of
O
C
Central Public Sector Enterprises (CPSEs) in India go to the National Investment Fund (NIF). NIF
in India was created in 2005. The fund aims to utilize these proceeds for various developmental purposes,
S.

including investment in social welfare programs, infrastructure development, recapitalization of public

sector banks, and other strategic initiatives.
E

• The NIF is managed by the Department of Investment and Public Asset Management (DIPAM)
T

under the Ministry of Finance. It operates as a part of the broader framework of disinvestment policies
O

in India, which aims to optimize the allocation of public resources and enhance the efficiency of CPSEs
while promoting economic growth and development. NIF is kept outside the consolidated fund of India
N

and is a reserve fund maintained in the Public Account of India.

• Hence, option (c) is the correct answer.
F
D

Q 47.B
.P

• Recently, a 2-judge bench of the Supreme Court directed the government of Himachal Pradesh to review
36
its policies on Child Care Leave concerning working mothers, especially mothers of children with special
W

needs. Participation of women in the workforce is a constitutional entitlement protected by Article

15 of the Constitution. Denying Women Child Care Leave (CCL) is unconstitutional. Hence,
W

statement 3 is correct.
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 • Child Care Leave (CCL)- Rule 43-C of the Central Civil Services (Leave ) Rules, 1972 provides for not 1
year but 2 years (730 days) of CCL to female employees with children under 18 years of age to look
after their kids. Hence, statement 1 is not correct.
• This leave can be used for any child-related needs like exams or illness.
• There is no age limit in the case of disabled children. Hence, statement 2 is correct.

Q 48.C
• SEBI is a quasi-legislative and quasi-judicial body which can draft regulations, conduct inquiries, pass
rulings and impose penalties.
• The Securities and Exchange Board of India was constituted as a non-statutory body on April 12,
1988 through a resolution of the Government of India.
o The Securities and Exchange Board of India was established as a statutory body in the year 1992 and
the provisions of the Securities and Exchange Board of India Act, 1992 (15 of 1992) came into force
on January 30, 1992. Hence statement 1 is correct.
• Functions of SEBI
o Regulation of capital market (Primary as well as secondary market).
o To register and regulate all intermediaries in stock exchanges like share brokers, underwriters,
Mutual Fund etc. Hence statement 2 is correct.
o To check malpractices in stock exchanges.
o To protect investor's interest and to promote investors education and awareness.
o Regulating substantial acquisition of shares and take over of companies
• All decisions taken by Securities and Exchange Board of India are collectively taken by its Board that
consists of a Chairman and eight other members.
• Securities Appellate Tribunal – SAT has been constituted to protect the interest of entities that feel
aggrieved by any of SEBI’s decision.
o SAT, consisting of a Presiding Officer and two other Members, has the same powers as vested in a
civil court.
• SEBI Chairman has the authority to order "search and seizure operations".
• It also works for promoting and regulating self-regulatory organizations and prohibiting fraudulent and
unfair trade practices relating to securities markets.

Q 49.B
• Fair and Remunerative Price (FRP) is a price set by the government of India to ensure fair
compensation to sugarcane farmers for their produce. It is announced by the Central Government
under the Sugarcane Control Order issued by the Ministry of Consumer Affairs, Food and Public
Distribution.
• The FRP is determined based on the recommendations of the Commission for Agricultural Costs
and Prices (CACP) and takes into account various factors such as the cost of production, fair returns to
farmers, and prevailing market conditions.
• Sugar mills are required to pay sugarcane farmers at least the FRP for their produce. This scheme aims to

O
support sugarcane farmers by providing them with a guaranteed minimum price for their crops, thereby
promoting sugarcane cultivation and ensuring fair income for farmers involved in the sugarcane sector.
C
• Hence, option(b) is the correct answer.
S.

Q 50.C
E

• Many distinguished thinkers contributed to the formulation of our five year plans. Among them,
T

the name of the statistician, Prasanta Chandra Mahalanobis, stands out. Planning, in the real sense
of the term, began with the Second Five Year Plan. The Second Plan, a landmark contribution to
O

development planning in general, laid down the basic ideas regarding goals of Indian planning; this plan
N

was based on the ideas of Mahalanobis. In that sense, he can be regarded as the architect of
Indian planning.
F

• Mahalanobis established the Indian Statistical Institute (ISI) in Calcutta and started a journal, Sankhya,
D

which still serves as a respected forum for statisticians to discuss their ideas. During the second plan
period, Mahalanobis invited many distinguished economists from India and abroad to advise him on
.P

India’s economic development. Among the economists

37 invited by Mahalanobis were those who were very
critical of the socialist principles of the second plan.
W

• Hence option (c) is the correct answer.

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W

38
W
W
.P
D
F
N
O
T
E
S.
C
O
W

39
W
W
.P
D
F
N
O
T
E
S.
C
O
Q 56.B
• The Phillips curve is an economic theory that inflation and unemployment have a stable and inverse
relationship. Developed by William Phillips, it claims that with economic growth comes inflation,
which in turn should lead to more jobs and less unemployment.
• The concept behind the Phillips curve states the change in unemployment within an economy has a
predictable effect on price inflation. The inverse relationship between unemployment and inflation is
depicted as a downward sloping, convex curve, with inflation on the Y-axis and unemployment on the X-
axis. Increasing inflation decreases unemployment, and vice versa. Alternatively, a focus on decreasing
unemployment also increases inflation, and vice versa. Hence, option (b) is the correct answer.
• The Phillips curve was a concept used to guide macroeconomic policy in the 20th century but was called
into question by stagflation in the 1970s.

Q 57.D
• Doxxing refers to the collection of a user’s private information, across multiple platforms (including
social media) by an unauthorized individual, who then publishes the information in an attempt to
shame or embarrass the user. Doxxing may be conducted by researching public databases, hacking, or
through social engineering. The term "doxxing" is derived from the phrase "dropping dox (documents)".
• Doxxing often involves hackers attempting to embarrass or shame individuals by publishing confidential
information, images or videos obtained from their personal accounts. Initially, doxxing was used by
hackers to "out" the identities of fellow bad actors/hackers. However, more recently, it has been used to
attack users with opposing viewpoints.
• Hence option (d) is the correct answer. O
C
S.

Q 58.B
• ASPIRE: A Scheme for Promotion of Innovation, Rural Industries and Entrepreneurship
E

(ASPIRE) aids in setting up a network of technology centres and incubation centres to accelerate
T

entrepreneurship and promote startups for innovation in agro-industry. ASPIRE provides financial
support to set up Livelihood Business Incubators (LBI) or Technology Business Incubator (TBI). Hence
O

option (b) is the correct answer.

N

• The main objectives of the scheme are to:

o Create new jobs and reduce unemployment
F

o Promote entrepreneurship culture in India

D

o Grassroots economic development at the district level

o Facilitate innovative business solutions for unmet social needs
.P

o Promote innovation to further strengthen the

40 competitiveness of the MSME sector
• Eligibility:
W

o Technical/Research Institutes: These institutions, including those specializing in agro-based

W

industries, can partner with ASPIRE to implement business idea incubation and commercialization
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 programs. They act as "knowledge partners" for new and existing technologies with
commercialization potential.
o Existing Incubator Programs: Existing incubation and commercialization schemes run by
organizations like MSME/NSIC/KVIC/Coir Board, other ministries, and even private incubators can
participate in ASPIRE.

Q 59.B
On 19 April 2024, The Climate Technology Centre and Network (CTCN) marks 10 years of technology and
innovation for adaptation, mitigation, and resilience.
• The Climate Technology Centre and Network (CTCN) is the implementation arm of the Technology
Mechanism of the United Nations Framework Convention on Climate Change and is hosted by UNEP.
The Centre promotes the accelerated transfer of environmentally sound technologies for low-carbon and
climate-resilient development at the request of developing countries. Hence statement 3 is correct.
• The CTCN was established in 2014. The CTCN offers solutions for developing countries to overcome
barriers to technology transfer, scaling, and replication. The CTCN works on a demand-driven approach
and supports the first-mile interaction on the country’s access to technology. Hence statement 1 is not
correct.
• The CTCN provides technology solutions, capacity building, and advice on policy, legal, and regulatory
frameworks tailored to the needs of individual countries by harnessing the expertise of a global network of
technology companies and institutions. It promotes accelerated transfer of environmentally sound
technologies for low carbon and climate resilient development at the request of developing
countries. Hence statement 2 is correct.

Q 60.B
• The World Bank Group (WBG) was established in 1944 to rebuild post-World War II Europe
under the International Bank for Reconstruction and Development (IBRD). It aimed to fight poverty
by offering developmental assistance to middle-income and low-income countries. It works with members
so they can meet their development goals, and achieve major, sustainable improvements in standards of
living for their people.
• The World Development Report is an annual report of the World Bank that analyses a specific
aspect of economic development. For instance, 2023 reports talked about migrants, refugees, and
society; 2022 was about finance for an equitable recovery and 2021 explores the tremendous potential of
the changing data landscape to improve the lives of poor people.
• World Development Report 2023: Migrants, Refugee, and Societies –
o About 2.3% of the world’s population live outside their country of nationality. Out of which some
43% live in low and middle-income countries
o It also estimated a 120% income gain for Indians who migrate to another country for work and in the
case of the US the income gain is as high as 500%.
o Some of the top migrant corridors are India-US, India-GCC and Bangladesh-India.
o India have received the highest ever foreign inward remittance of $89 bn in FY2021-22.
o There are four types of migrants – economic migrants with strong skills, refugees with skills in
demand at the destination, distressed migrants, and refugees O
C
Q 61.A
S.

• White Label ATMs (WLAs):

o White Label ATMs (WLAs) are automated teller machines that are owned and operated by non-bank
E

entities known as White Label ATM Operators (WLAOs). These ATMs are set up under the
T

guidelines issued by the Reserve Bank of India (RBI) to enhance the reach of banking services in
O

areas where traditional bank branches may not be feasible or economically viable.
• Key Features of White Label ATMs:
N

o Operated by Non-Bank Entities: Unlike traditional ATMs, which are typically owned and operated
F

by banks, White Label ATMs are operated by non-bank entities. These entities can include
independent ATM deployers, retail companies, technology firms, or other financial service
D

providers. Hence statement 2 is not correct.

.P

o Service All Bank Customers: White Label ATMs are designed to provide banking services to
customers of all banks. This means that 41 customers can use a WLA to perform various transactions,
W

such as cash withdrawals, balance inquiries, fund transfers, and bill payments, regardless of their bank
affiliation. Hence statement 1 is correct.
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 o Charging of Fees: Since White Label ATM Operators invest in setting up and maintaining ATMs,
they charge fees for the services provided. These fees may include transaction charges for cash
withdrawals or balance inquiries, which are typically borne by the ATM user. The fees charged by
WLAs are regulated by the RBI to ensure fairness and transparency.

Q 62.A
• Some of the major changes done in Union budgeting in the last two decades, to make it more efficient are
as follows:
• Rationalization of Centrally Sponsored Schemes (CSS) and expenditure thereon: Budget 2016-17
introduced a new classification system for the Centre’s spending, based on the categorization of CSS,
pruning the existing 66 CSSs to 28, and then further dividing them into three categories—six ‘core of the
core’ schemes, 20 core schemes, and two optional schemes. This system was put in place on the
recommendations of a sub-committee of Chief Ministers formed by Niti Aayog for the rationalization of
the CSS.
• Scrapping of Plan and Non-Plan Classification: The previously exiting Plan and non-plan classification
of expenditure has been done away with from FY 2017-2018 and their place has been now taken by
capital and revenue spending classifications. In 2011, an experts’ committee headed by C. Rangarajan had
proposed that this distinction should be abolished. This move is in line with the scrapping of the Planning
Commission and thereby development based on hitherto existing planning.
• Merging of Railway and General Budget: The 92-year-old practice of presenting separate budgets-
Railway Budget and General Budget has been abolished. It was recommended by Bibek Debroy
Committee on restructuring and reforming railways. This move is being lauded for it will be beneficial for
the economy at large and there will be a positive influence in the development in railways. Hence, option
(a) is the correct answer.

Q 63.B
• “Crystal Maze 2 is an advanced air-launched missile developed by Israel, designed for precision strikes on
high-value targets. This missile is capable of engaging heavily fortified positions from long distances,
ensuring minimal collateral damage. It is renowned for its accuracy and reliability in combat scenarios,
making it a preferred choice for missions requiring surgical precision. Hence statement 1 is not correct.
• The Indian Air Force achieved a significant enhancement in its capabilities by successfully conducting a
test firing of a Crystal Maze 2 air-launched ballistic missile. This missile has the ability to strike targets
located at distances exceeding 250 kilometres. Hence statement 2 is correct.
• The missile’s integration into various platforms enhances its operational flexibility and effectiveness in
diverse combat environments. It is designed to target high-value stationary and relocatable assets, such as
long-range radars and air defense systems, of potential adversaries. It is specifically effective in GPS-
denied environments. Hence statement 3 is correct.

Q 64.C
• The International Monetary Fund, IMF, was established along with the International Bank for
Reconstruction and Development at the Conference of 44 Nations held at Bretton Woods in
1944. The IMF was created to further international monetary cooperation, encouraging the expansion of O
C
trade and economic growth, and discouraging the policy that would harm prosperity.
• The process of monitoring and discussing countries’ economic and financial policies is known as bilateral
S.

surveillance. Regularly—usually once each year—the IMF conducts in depth appraisals of each member
E

country’s economic situation. It also carries out extensive analysis of global and regional economic trends,
known as multilateral surveillance. Its key outputs are three semi-annual publications, the World
T

Economic Outlook, the Global Financial Stability Report, and the Fiscal Monitor. Hence options 1
O

and 3 are correct.

• World Economic Outlook, April 2024: Steady but Slow: Resilience and Divergence –
N

o The world economy to continue growing at 3.2% during 2024 and 2025 at the same pace as in 2023.
F

o The forecast of global growth five years from now at 3.1% is at its lowest in decades.
o Global inflation is forecast to decline steadily from 6.8% in 2023 to 5.9% in 2024 and 4.5% in 2025.
D

o The global economy has been surprisingly resilient despite significant central bank interest rate hikes
.P

to restore price stability.

o Global Financial Stability Report, 2024: The 42 Last Mile: Financial Vulnerabilities and Risks
W

▪ The near-term global financial stability risks have receded amid expectations that global
disinflation is entering its last mile.
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 ▪ It has raised concerns over a growing unregulated private credit market in which non-bank
financial institutions lend to corporate borrowers.
• Fiscal Monitor Report, April 2024: Fiscal Policy in the Great Election Year:
o It highlights the heightened risk to public finances given potential distortions from a record number of
elections this year in the context of elevated public debt, still high-interest rate, and slowing growth
prospects
o It talked about ensuring decisive fiscal consolidation efforts to safeguard sustainable finance while
protecting the most vulnerable.
• Global Economic Prospect Report is released by World Bank. Recently, it was published in January
2024, which predict a slow global growth for the third consecutive year, dropping from 2.6% in 2023 to
2.4% in 2024. Hence option 2 is not correct.

Q 65.C
• Recent context- RBI Introduces Two New UPI Features! From Cash Deposit To PPI Wallet
Interoperability.
• The Unified Payments Interface (UPI) is a revolutionary digital payment system in India.
• It allows users to instantly transfer money between bank accounts through a mobile platform.
• Features of UPI:
o Instantaneous: Money transfers happen in real-time, 24/7.
o Simple & Convenient: No need to remember bank account details or IFSC codes.
o Secure: Transactions are protected by multi-factor authentication and UPI PIN.
o Versatile: Pay for online purchases, bills, recharges, and even at physical stores using QR codes.
o Free to use: Most UPI transactions are free of charge.
• Unified Payments Interface (UPI) Lite
o It is a feature that enhances the capabilities of the UPI platform by introducing an on-device wallet
functionality.
o It is designed to facilitate offline transactions, particularly for small-value payments.
• UPI Lite creates an on-device wallet on the user's smartphone. This wallet stores a small balance of
funds that can be used to make transactions without an active internet connection.
• You can add funds to your UPI Lite wallet from any linked bank account. With UPI Lite, you can
make transactions up to Rs 500 per transaction. In a day, you can add a total of Rs 4000 to your
UPI Lite account. However, note that the UPI Lite app can only hold a maximum of Rs 2000 at a
time. Hence, statement 1 is correct.
o This limit is in place to ensure the security and stability of the system, particularly for users who may
not have access to real-time internet connectivity.
• In traditional UPI transactions, users need to enter their UPI PIN to authorize payments.
o However, for UPI Lite payments, the RBI has waived this requirement to enhance transaction
convenience for small amounts. Hence, statement 2 is correct.
• The National Payments Corporation of India (NPCI) has introduced two new features for the UPI:
o Deposit Cash at Cash Deposit Machines Using UPI:
▪ This feature allows users to deposit cash into their bank accounts using Cash Deposit Machines
(CDMs) without the need for a physical debit card. O
C
▪ Users can simply scan the QR code displayed on the CDM using their UPI app and enter the
S.

amount to be deposited.
▪ The cash is credited to the user's bank account instantly. Hence, statement 3 is correct.
E

o UPI Payments from Prepaid Payment Instruments (PPIs) Using Third-Party Apps:
▪ This feature allows users to make UPI payments using prepaid payment instruments (PPIs) such
T

as prepaid cards, wallets, or gift cards, through third-party apps.

O

▪ Users can link their PPI to the third-party app and initiate UPI payments.
N

Q 66.A
F

• The budget is not merely a statement of receipts and expenditures. Since Independence, with the
D

launching of the Five-Year Plans, it has also become a significant national policy statement. The budget, it
has been argued, reflects and shapes, and is, in turn, shaped by the country’s economic life. Along with
.P

the budget, three policy statements are mandated by the Fiscal Responsibility and Budget
Management Act, 2003 (FRBMA). 43
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o The Medium-term Fiscal Policy Statement sets a three-year rolling target for specific fiscal
indicators and examines whether revenue expenditure can be financed through revenue receipts on a
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 sustainable basis and how productively capital receipts including market borrowings are being
utilized.
o The Fiscal Policy Strategy Statement sets the priorities of the government in the fiscal area,
examining current policies and justifying any deviation in important fiscal measures.
o The Macroeconomic Framework Statement assesses the prospects of the economy with respect to
the GDP growth rate, fiscal balance of the central government and external balance
• The Financial Stability Report is released by the Reserve Bank of India. It is a half-yearly
publication with contributions from all financial sector regulators. Hence, option (a) is the correct
answer.

Q 67.B
• The structure of economic activities changes over time due to changes in the structure of production and
demand in the economy. Therefore, the rebasing exercise is needed after a certain period to account for
these structural changes and to update the prices. The exercise of rebasing national accounts brings up a
fresh lot of information about the changes in the economic structure of the economy, along with switching
over to new base prices. This also helps in judging the size of the economy, correcting biases, and looking
afresh at the relative importance of sectors in the economy. The new series of national accounts by
the Central Statistics Office (CSO) revised the base for National Accounts Statistics to 2011-12 from
2004-05 , last set in January 2010. Along with revising the base, several methodological changes have
also been made. Hence statement 1 is not correct.
• The ratio of nominal and real GDP gives us an idea of how the prices have moved from the base year (the
year whose prices are being used to calculate the real GDP) to the current year. In calculating the real
and nominal GDP of the current year, the production volume is fixed. Therefore, if these measures
differ, it is only due to a change in the price level between the base year and the current year. The ratio of
nominal to real GDP is a well-known index of prices. This is called GDP Deflator. Thus if GDP stands for
nominal GDP and gdp stands for real GDP then, GDP deflator =GDP/gdp . Hence statement 2 is correct.
• Hence option (b) is the correct option.

Q 68.B
• "Masala Bonds" are Indian rupee-denominated debt instruments issued in offshore capital markets.
Hence, statement 1 is not correct.
o These were first issued by the International Finance Corporation (IFC), a member of the World
Bank group.
• They were introduced in the international capital market in November 2014 to raise funds for
supporting private sector infrastructure development initiatives in India. Hence, statement 2 is
correct.
• Further, Masala bonds are also listed on the London Stock Exchange.
• In 2015, RBI put in place a framework for issuance of rupee-denominated bonds overseas within the
overarching External Commercial Borrowing (ECB) policy, in order to facilitate rupee-denominated
borrowing from overseas.

Q 69.B O
C
• GOI launched the Drought Prone Area Development Programme (DPAP) during 1973-74 (Fourth Five
Year Plan: 1969-1974) to address special problems of drought-prone areas. DPAP watershed program was
S.

sponsored by the Ministry of Rural Development, Govt. of India which focuses on harnessing and
E

conserving land and water through various soil and water conservation interventions for increasing and
sustaining the productivity of land and improving the livelihoods of the watershed communities which are
T

mostly agricultural workers and landless agricultural laborers. Hence statement 1 is not correct.
O

• The period of 1975-1977 was a period of instability due to the National Emergency. After the electoral
N

defeat of Congress, the Janata Party government rejected the fifth five-year Plan and introduced the
Rolling Plan. This, in turn, was rejected by the Indian National Congress in 1980 upon Indira Gandhi's re-
F

election. Hence statement 2 is correct.

• Rolling Plan: A rolling plan is one in which the effectiveness of the plan is evaluated annually and a new
D

plan is created the following year based on this evaluation. As a result, throughout this plan, both the
.P

allocation and the targets are updated.

44
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Q 70.C
• Buffer stock refers to a reserve of a commodity that is used to offset price fluctuations and
unforeseen emergencies. Buffer stock is generally maintained for essential commodities and
necessities like food grains, pulses, etc.
• The concept of buffer stock in India was first introduced during the Fourth Five-Year Plan (1969-
74).
• Buffer stock of food grains in the Central Pool is maintained by the Government of India (GOI) /
Central Government for the following purposes:
o To meet the prescribed minimum buffer stock norms for food security.
o To monthly release of food grains for supply through Targeted Public Distribution System (TPDS)
and Other Welfare Schemes (OWS).
• To meet the emergencies arising out of unexpected crop failure, natural disasters, etc., and
• Price stabilization or market intervention to augment supply to help moderate the open market prices.
• Hence, option(c) is the correct answer.

Q 71.D
Recently, Pakistan launched its first Hangor class submarine which is considered a direct counterpart of
India's Kalvari class of submarines. The first Hangor class submarine, built by China for Pakistan, was
launched on April 26 at a Wuhan shipyard. This was the first of eight submarines of this class that the
Pakistan Navy is set to induct into its fleet by 2028.
• The Kalvari Class submarines are diesel-electric attack submarines and not nuclear-powered. They use
conventional diesel-electric propulsion systems, which is typical of the Scorpène class that they are
derived from. Hence statement 1 is not correct.
• The Kalvari Class submarines are built as part of a collaboration between India and France. The
submarines are being constructed by Mazagon Dock Limited in Mumbai with significant technology
transfer and support from the French naval defense and energy company Naval Group (formerly known as
DCNS). Hence statement 2 is not correct.
• The Defence Research and Development Organisation (DRDO) has signed an agreement with the Naval
Group France under which the indigenous Fuel Cell-based Air Independent Propulsion (AIP) system will
soon be fitted on INS Kalvari. An Air Independent Propulsion (AIP) system is a technology used in
submarines to allow them to operate underwater for longer periods without the need to surface or snorkel
for air.
• Project-75 (India), also known as P-75(I), is a military acquisition initiative by the Ministry of Defence
(MoD). Project 75 was initiated to build six diesel-electric attack submarines of the Kalvari class that is
based on the Scorpene class, which are being built at MDL (Mazagon Dock Limited). Project 75 is one of
the largest ‘Make in India’ Projects. Through the P75, India has acquired faster and more significant
absorption of technology and created a tiered industrial ecosystem for submarine construction in India.

Q 72.A
• Researchers at the Indian Institute of Technology (IIT) Roorkee have reported the discovery of

O
fossils of one of the largest snakes that ever existed and likely lived 47 million years ago during a
period called the Middle Eocene.
C
• The fossils were found in Kutch, Gujarat, and the reptile, named Vasuki Indicus, could have been
S.

anywhere between 10 meters and 15 meters long, or as big as a modern-day school bus. This giant serpent
is thought to have been among the most formidable predators from the time of the dinosaurs' extinction 65
E

million years ago to the emergence of Megalodon around 23 million years ago.
• Vasuki, named after the snake king associated with the Hindu deity Shiva, rivals in size another huge
T

prehistoric snake called Titanoboa, whose fossils were discovered in a coal mine in northern Colombia, as
O

announced in 2009. Titanoboa, estimated at 42 feet (13 meters) long and 1.1 metric tons, lived 58-60
N

million years ago. The reticulated python is the longest extant snake, sometimes measuring 20-30 feet (6-
9 meters).
F

• Hence option (a) is the correct answer.

D

Q 73.B
.P

• Inflationary Gap refers to a situation in which Aggregate demand is more than the productive
45
capacity of an economy (aggregate demand at full employment level. An inflationary gap measures
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the difference between the current real GDP and the GDP of an economy operating at full
employment. Hence, statement 1 is not correct.
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 • The inflationary gap represents the point in the business cycle when the economy expands as consumers
purchase more goods and services. As demand increases but production lags, prices rise to restore market
equilibrium.
• The real GDP must be higher than the potential GDP for the gap to be considered inflationary. When the
potential GDP is higher than the real GDP, the gap is instead referred to as a deflationary gap.
• Inflationary gap leads to inflation which can be controlled by reductions in government spending,
tax increases, bond and securities issues, interest rate increases, and transfer payment reductions. A
government may use fiscal policy to help reduce an inflationary gap by decreasing the number of
funds circulating within the economy. Hence, statement 2 is correct.

Q 74.C
• Foreign Direct Investment (FDI)
o Foreign Direct Investment (FDI) refers to the investment made by a foreign entity (individual,
company, or government) in the economy of another country with the aim of establishing business
operations or acquiring lasting interest in enterprises located in that country. There are various types
of FDI, including:
o Horizontal FDI:
▪ Horizontal FDI occurs when a foreign company establishes the same type of business operation in
a host country as it operates in its home country. Hence statement 3 is correct.
▪ This type of investment involves replicating existing business activities or production processes in
the host country.
▪ Example: A foreign automobile manufacturer setting up a manufacturing plant in India to produce
cars, similar to its operations in its home country.
o Vertical FDI:
▪ In a vertical FDI, a business acquires a complementary business in another country. For
example, a U.S. manufacturer might acquire an interest in a foreign company that supplies it with
the raw materials it needs. Hence statement 1 is not correct.
o Conglomerate FDI:
▪ Conglomerate FDI involves foreign investment in businesses that are unrelated to the investor's
core business activities. Hence statement 2 is not correct.
▪ This type of investment typically aims to diversify the investor's portfolio or enter new markets.
▪ Example: A foreign technology company investing in a hotel chain in India or acquiring a stake
in a pharmaceutical company.

Q 75.D
• Five-Year Plans (FYPs) are centralized and integrated national economic programs. Joseph Stalin
implemented the first FYP in the Soviet Union in the late 1920s. After independence, India launched
its First FYP in 1951, under the socialist influence of first Prime Minister Jawaharlal Nehru. The
model of the Indian Economy was premised on the concept of planning based on five-year plans
from 1951-2017.
• The goals of the five-year plans were: growth, modernization, self-reliance, and equity. This does not
O
mean that all the plans have given equal importance to all these goals. Due to limited resources, a choice
C
has to be made in each plan about which of the goals is to be given primary importance. Nevertheless, the
planners have to ensure that, as far as possible, the policies of the plans do not contradict these four goals.
S.

• Growth: It refers to the increase in the country’s capacity to produce the output of goods and
E

services within the country. It implies either a larger stock of productive capital, or a larger size of
supporting services like transport and banking, or an increase in the efficiency of productive capital and
T

services. A good indicator of economic growth is a steady increase in the Gross Domestic Product (GDP).
O

The GDP is the market value of all the final goods and services produced in the country during a year.
• Modernization: The adoption of new technology is called modernization. However, modernization
N

does not refer only to the use of new technology but also to changes in social outlook such as the
F

recognition that women should have the same rights as men.

• Self-reliance: The first seven five-year plans gave importance to self-reliance which means avoiding
D

imports of those goods which could be produced in India itself. This policy was considered a necessity
.P

in order to reduce our dependence on foreign countries, especially for food.

• Equity: Equity refers to fairness or justice 46 in the distribution of resources, opportunities, or
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outcomes among individuals or groups. It is important to ensure that the benefits of economic
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 prosperity reach the poor sections as well instead of being enjoyed only by the rich. So, in addition to
growth, modernization, and self-reliance, equity is also important.
• Hence, option (d) is the correct answer.

Q 76.A
• AstraZeneca recently admitted in a legal filing in the UK that its vaccine can result in a condition
known as thrombosis with thrombocytopenia syndrome (TTS) in rare instances.
• Thrombosis with thrombocytopenia syndrome (TTS) is a rare but serious condition characterized by blood
clot formation (thrombosis) coupled with low platelet counts (thrombocytopenia).
• TTS typically manifests with symptoms such as severe headaches, abdominal pain, leg swelling, shortness
of breath, and neurological deficits. Diagnosis involves blood tests to assess platelet levels and imaging
studies to detect blood clots.
• Treatment for TTS involves a multidisciplinary approach, including hospitalization, anticoagulation
therapy to prevent further clotting and supportive care. Intravenous immunoglobulin (IVIG) and plasma
exchange may also be utilized to stabilize platelet levels and manage immune-mediated reactions.
• Hence option (a) is the correct answer.

Q 77.C
• Outcome budgeting is a budgeting scheme that gives project-wise outlays for all central ministries,
departments and organizations listed against corresponding outcomes (measurable physical targets)
to be achieved during the year. It measures the development outcomes of all government
programmes. Hence, statement 1 is correct.
• Outcome-based performance budgeting symbolizes a shift from traditional budgeting in the sense that it
goes beyond budgeting by inputs (how much can we spend) towards budgeting by measurable outcomes
(what can we achieve with what we spend). It is expected to sharpen the budgetary projections by listing
the projected outcomes under various schemes.
• The outcomes are expected results not only in terms of monetary units or physical infrastructure
but also in terms of qualitative targets and achievements. The first step is defining the desired
outcomes (mostly long-term) for the concerned ministry, department or function. This is followed
by the process of identifying the interventions required for achieving target outcomes. Finally, the
expenditure required for implementing the identified interventions is estimated, which forms a line
item in the budget for that particular year. Hence, statement 2 is correct.

Q 78.C
• In a groundbreaking move, Koodiyattam virtuoso G. Venu defied convention in 2003 by showcasing
Kalidasa's Abhignanasakuntalam, earning global acclaim. Emboldened by this recognition, he embarked
on staging the initial three Acts of Vikramorvasiyam.
• Recently, in a remarkable development, Sooraj Nambiar, renowned unveiled the fourth Act of
Vikramorvasiyam for the very first time in the art form's history. Drawing from over three decades of
immersion in this ancient tradition, Sooraj premiered his production, Unmatha Vikraman, at
Natanakairali, Irinjalakuda, marking a pivotal moment in Koodiyattam's evolution.
• Koothiyattam (Koodiyattam)- O
C
o It represents a synthesis of Sanskrit classicism and reflects the local traditions of Kerala. In its stylized
S.

and codified theatrical language, neta abhinaya (eye expression) and hasta abhinaya (the language of
gestures) are prominent.
E

o They focus on the thoughts and feelings of the main character. Koodiyattam is traditionally performed
T

in theatres called Kuttampalams, which are located in Hindu temples.

o It originated in the 10th century AD in Kerala. It is India’s oldest continuing form of theatre.
O

o Margi Madhu Chakyar is a leading exponent of this art form.

o The architects of Koodiyattam, the Sanskrit theatre tradition that survives only in Kerala, is the
N

Chakyar community for whom the performance of the art form is ‘Kuladharma’ (family
F

duty). Hence, statements 1 and 2 are correct.

D

o While the works of various well-known poets have remained the mainstay of this art form, it is
surprising to note that the Chakyars have been less enthusiastic about the works of Kalidasa, who is
.P

popular across the globe.

o In 2008, Koodiyattam was added to the 47 UNESCO List of Intangible Cultural Heritage. It has
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been designated by UNESCO as a 'Masterpiece of Oral and Intangible Heritage of Humanity'. Hence,
statement 3 is correct.
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Q 79.A
• The civil aviation industry in India has emerged as one of the fastest growing industries in the country
during the last three years and can be broadly classified into scheduled air transport service which
includes domestic and international airlines, non-scheduled air transport service which consists of charter
operators and air taxi operators, air cargo service, which includes air transportation of cargo and mail.
• Currently, the country has 149 operational airports which includes 137 airports, 2 Water aerodromes and 9
Heliports. Among them there are 29 international, 92 domestic, and 10 custom airports. To meet the
growing demand for air travel in India, it has become imperative to increase the capacity of airport
infrastructure.
• India is the third largest domestic market for civil aviation in the world.
• The civil aviation sector contributes to 5% of GDP and 4 million jobs. Hence statement 1 is not
correct.
• Director General of Civil Aviation (DGCA) is the regulatory body in the field of civil aviation under
the Ministry of Civil Aviation. Hence statement 2 is correct.
• RCS - UDAN (Regional Connectivity Scheme - Ude Desh ka Aam Nagrik)
o UDAN will be applicable on flights which cover distance between 200 km and 800 km with no
lower limit set for hilly, remote, island and security sensitive regions. Hence statement 3 is not
correct
o The scheme seeks to reserve a minimum number of UDAN seats i.e. seats at subsidized rates and also
cap the fare for short distance flights.
o The scheme UDAN envisages providing connectivity to un-served and under-served airports of the
country through revival of existing air-strips and airports.
• National Civil Aviation Policy
o India to become 3rd largest civil aviation market by 2022 from 9th.
o Domestic ticketing to grow from 8 Cr in 2015 to 30 Cr by 2022.
o Cargo volumes to increase by 4 times to 10 million tonnes by 2027.
o Ensuring availability of quality certified 3.3 lakh skilled personnel by 2025.

Q 80.C
• India's election laws are governed by the following:
o Representation of the People Act, 1950: Outlines the framework for elections, including eligibility,
voter registration, and candidate nomination.
o Representation of the People Act, 1951: Regulates the conduct of elections, including campaign
financing, use of symbols, and polling procedures.
• The ECI has the power to declare a poll void in instances related to:
o Damage to EVMs.Hence, option 1 is correct.
o Booth-capturing. Hence, option 2 is correct.
o Natural disasters. Hence, option 3 is correct.
• Damage to EVMs:
o Section 58 of the Representation of People Act, 1951 (RPA) empowers the ECI to declare a re-poll
in a polling station if certain specific conditions are met:
▪ Unlawful Removal of EVM: If any unauthorized person has unlawfully taken away any O
C
Electronic Voting Machine (EVM) from the polling station.
▪ Destruction, Loss, Damage, or Tampering of EVM: If any EVM has been accidentally or
S.

intentionally destroyed, lost, damaged, or tampered with before the completion of polling.
E

▪ Mechanical Failure during Vote Recording: If a mechanical failure develops in any EVM
during the recording of votes and it is impossible to continue voting using that machine.
T

• Booth-Capturing:
O

o ECI has the authority to declare a poll void under Section 135A of the Representation of the
N

People Act (RPA) if booth capturing is proven.

o This can happen under the following circumstances:
F

▪ Seizure of a polling station: If a group takes control of a polling station, disrupting the voting
D

process and preventing legitimate voters from exercising their right.

▪ Selective voting: If only a specific group of supporters are allowed to vote, excluding others and
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compromising the fairness of the election.

48
▪ Voter intimidation: If voters are threatened or coerced, preventing them from reaching the
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polling station or voting freely.

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 ▪ Seizure of a counting place: If the counting process is disrupted by forcefully taking control of
the counting center, potentially manipulating the results.
• Natural Disasters
o ECI has the authority to adjourn the poll under specific circumstances outlined in Section 57(1)
of the RPA, 1951. These situations include:
▪ Natural Calamities: Events like floods, severe storms, or earthquakes that disrupt the polling
process and endanger the safety of voters and officials.
• Death of a Candidate
o Under section 52 of RPA (Amended in 1996), ECI has the power for adjournment of Poll. This
section states that if a candidate from a recognized political party dies, the ongoing poll in that
constituency will be adjourned.
o Applicability: This rule applies only under specific conditions:
▪ The deceased candidate must have a valid nomination.
▪ The death must occur after 11:00 AM on the last date for filing nominations but before the
commencement of the poll.

Q 81.C
• Kalesar Wildlife Sanctuary is a protected wildlife reserve located in the eastern part of Yamuna
Nagar district in the Indian state of Haryana. Covering an area of 11,000 acres, it is situated in the
Shivalik foothills of the Himalayas and is home to a variety of flora and fauna. The sanctuary derives its
name from the Kalesar forest, which is a part of the reserve.
• The Kalesar Wildlife Sanctuary is home to many species of animals, including leopards, sambar deer,
barking deer, hyenas, jackals, Indian porcupines, Indian pangolins, and langurs. The sanctuary is also
home to several species of birds, such as the red junglefowl, grey partridge, Indian peafowl, and white-
throated kingfisher.
• In addition to its natural attractions, the Kalesar Wildlife Sanctuary also has historical significance. The
sanctuary houses the Kalesar Fort, which is believed to have been built during the reign of the
Mughal emperor Aurangzeb.
• Hence option (c) is the correct answer.

Q 82.B
• An economic variable is any factor that may help to determine how an economy functions and its impact
on the economy.
• Flows are defined over time. Thus income, outputs or/and profits are concepts that make sense only when
a time-period is specified. These are called flows because they occur in a period of time. Hence option
(b) is the correct answer.
• Stock variables are defined at a particular point of time. Bank Balance is a stock variable while
withdrawals and interests earned are flow variables. Equity shareholding is a stock variable while sale
and purchase of shares are flow variables.

Q 83.A
• At the time of independence, the land tenure system was characterized by intermediaries variously calledO
C
zamindars, jagirdars, etc.) who merely collected rent from the actual tillers of the soil without contributing
towards improvements on the farm. The low productivity of the agricultural sector forced India to import
S.

food from the United States of America (U.S.A.). Equity in agriculture called for land reforms which
E

primarily refer to change in the ownership of landholdings.

• Land reforms in India were initiated to address the unequal distribution of land ownership, with
T

the primary goal of redistributing land to landless farmers to alleviate poverty and promote social
O

justice.
• Land reforms are an integral part of the scheme of agricultural development and rural reconstruction since
N

the inception of economic planning in the country. As put in the words of the Second Five Year Plan, the
F

objective of land reform was to create conditions for evolving as speedily as possible the agrarian
D

economy with high levels of efficiency and productivity and to establish an egalitarian society and
eliminate social inequalities.
.P

• The same objective was repeated in the Fifth Five-Year Plan Draft. The Land Reforms in India aimed at
the redistribution of ownership holdings and49reorganizing operational holdings from the viewpoint of
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optimum utilization of land. It has also aimed at providing security of tenure, fixation of rents, and
conferment of ownership.
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 • The major objectives of the land reform package, as identified in the Eighth Plan, are:
o Restructuring of agrarian relations to achieve an egalitarian structure
o Elimination of exploitation in land relationsActualization of the goal of “land to the tiller”
o Improvement of socio-economic conditions of the rural poor by widening their land base
o Increasing agricultural production and productivity
o Facilitating land-based development of rural poorInfusion of a great measure of equality in local
institutions
• Hence, option(a) is the correct answer.

Q 84.A
• The Asian Development Bank, ADB, is a multilateral development financing institution that was
established in 1996. Its headquarters is in Manila, Philippines.
• The largest shareholders of this bank are Japan and the United States, each with 15.6% of the total share.
The other major shareholders are the People's Republic of China (6.4%), India (6.3%) and Australia
(5.8%). So, India is among the top 5 largest shareholders. Hence statement 1 is correct.
• The membership and the bank is open to members and associate members of the United Nations
Economic Commission for Asia and the Far East and other regional countries and non-regional developed
countries which are members of the United Nations or any of its specialised agencies. At present there
are 68 members including India. Out of 68 members, 49 are from Asia and the Pacific and 19 are from
outside this region. Hence statement 2 is not correct.
• It has the objectives like –
o To promote investment in the region of public and private capital for development purposes. Hence
statement 3 is not correct.
o To provide financial assistance to the developing countries.
o Coordinate with member countries in their developmental policies and plan
o To provide technical assistance for the preparation, financing, and execution of development projects
and programs

Q 85.C
• India is strategically located on the world’s shipping routes with a coastline of approximately 7,517 km.
As of 2021, India owns over 30% global market share in the ship breaking industry and is home to the
largest ship-breaking facility in the world at Alang.
• The Maritime India Vision 2030 has identified over 150 initiatives to boost the Indian maritime sector.
• Around 95 per cent of India's trade by volume and 68 per cent in terms of value is transported by
sea. Hence statement 1 is corerct.
• Inland Water Transport (IWT) carries less than 2 percent of India's organized freight traffic and
negligible passenger traffic. The Inland Waterways Authority of India (IWAI) is mandated to develop and
maintain infrastructure for fairway, navigational aids and terminals. Hence statement 2 is correct.
• Sagar Mala Project
o Focuses on modernizing and developing ports, enhancing port connectivity, supporting coastal
communities and stimulating port-linked industrialization.
o Jal Marg Vikas Project is expected to benefit densely populated states of Uttar Pradesh, Bihar, O
C
Jharkhand and West Bengal through the development of national waterways.
o 14 mega Coastal Economic Zone (CEZs) is proposed to be established.
S.

o Each CEZ will be an agglomeration of coastal districts within a State.

E

o Aims to double the share of water transportation in the modal mix.

o Aims to reduce the logistics costs for foreign and domestic trade, leading to an overall cost savings of
T

INR 35,000 to INR 40,000 Cr annually by 2025.

O
N

Q 86.A
• Railways
F

o India has the 4th largest railway system in the world, behind only US, Russia and China. The
D

Indian Railways consists of a total track length of 126,366 km with 7,335 stations. The railways
operate 13,523 passenger trains and 9,146 freight trains daily. Hence statement 1 is correct.
.P

▪ It is also the largest passenger and fourth largest freight transporting railway system globally.
▪ However, the modal share of railways 50in the transportation of surface freight has declined from
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86.2 per cent in 1950-51 to 33 percent in 2015.

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 o Recent Initiatives
▪ National Rail Plan: To develop infrastructure by 2030 to cater to the traffic requirements up to
2050.
▪ Freight on Priority policy: A customer-centric approach to expand the freight carried from the
traditional segments as well as attracting new customers to its fold.
▪ Dedicated Freight Corridors (DFCs): It will decongest the existing Indian Railway network,
increase the average speed of goods trains from existing 25 to 70 kmph., run heavy haul trains and
reduce the logistic cost of transportation.
▪ Installation of Indigenous Train Collision Avoidance System (TCAS): For increased safety of the
passengers.
▪ Meri Saheli: For focused action on security of women travelling in trains.
▪ Rail Drishti Portal: An information portal that brings key details from various sources on a single
dashboard in order to promote transparency and accountability.
• Roads & Highways
o India has the second largest road network in the world, spanning about 66.71 Lakh km, which
includes national highways, state highways, district roads, and rural roads. This extensive network
ensures connectivity across various regions of the country.
o National Highways (NH) play a very important role in the economic and social development of the
country by enabling efficient movement of freight and passengers and improving access to
market. They account for 2% of the total road network and carry over 40% of total traffic.
Hence statement 2 is not correct.
o Share of transport sector in the GVA for 2021-22 was about 4.5%.
o The Indian Government has been actively investing in the development of road infrastructure. Major
initiatives like the Bharatmala Pariyojana aim to upgrade and expand the road network, including the
construction of expressways, economic corridors, and feeder routes.
o 100% FDI in roads and highways is allowed under automatic route.

Q 87.C
• An ad valorem tax is a tax based on the assessed value of an item, such as real estate or personal
property. The most common ad valorem taxes are property taxes levied on real estate. However, ad
valorem taxes may also extend to a number of tax applications, such as import duty taxes on goods
from abroad. Hence, statement 1 is correct.
• The Latin phrase ad valorem means "according to value." All ad valorem taxes are levied based on the
determined value of the item being taxed. In the most common application of ad valorem taxes, which are
municipal property taxes, the real estate of property owners is periodically assessed by a public tax
assessor to determine its current value. The assessed value of the property is used to compute a tax
annually levied on the property owner by a municipality or other government entity.
• The Goods and Services Tax in India is an ad valorem tax. For example, the rate of GST approved
by the GST Council on access to circus, theatre, Indian classical dance including folk dance and
drama is 18% ad valorem. 28% GST on luxury cars is also ad valorem. Hence, statement 2 is
correct.
O
C
Q 88.D
• The Financial Intelligence Unit - India (FIU-IND) functions under the Ministry of Finance, not the
S.

Ministry of Home Affairs. Financial Intelligence Unit—India (FIU-IND) is an organization under the
Department of Revenue, Government of India which collects financial intelligence about offenses under
E

the Prevention of Money Laundering Act, 2002. It was set up in November 2004 and reports directly to
T

the Economic Intelligence Council (EIC) headed by the finance minister. Hence statement 1 is not
O

correct.
• It is the central national agency responsible for receiving, processing, analyzing, and disseminating
N

information relating to suspect financial transactions. It is mandatory for banks in India to furnish a
F

monthly CTR to the FIU on All transactions over Rs. 10 lakh or its equivalent in foreign currency or a
series of integrally connected transactions that add up to more than Rs. 10 lahks or it's equivalent in
D

foreign currency. Hence statement 2 is not correct.

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• It is also responsible for coordinating and strengthening efforts of national and international intelligence,
investigation, and enforcement agencies in51pursuing global efforts against money laundering and
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financing of terrorism.
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Q 89.B
• Ethylene (H2C=CH2), the simplest of the organic compounds known as alkenes, which contain carbon-
carbon double bonds. It is a colourless, flammable gas that has a sweet taste and odour. Natural sources of
ethylene include both natural gas and petroleum; it is also a naturally occurring hormone in plants, in
which it inhibits growth and promotes leaf fall, and in fruits, in which it promotes ripening.
• About Ethylene
o Colourless, flammable gas having a sweet taste and odour.
o Gaseous plant growth promoter.
o Highly effective in fruit ripening; Enhances respiration rate during ripening of fruits.
o Breaks seed and bud dormancy, initiates germination in peanut seeds, sprouting of potato tubers.
o Promotes root growth and root hair formation.
o Ethephon is the most widely used compound as a source of ethylene. Ethephon in an aqueous solution
is readily absorbed and transported within the plant and releases ethylene slowly.
• FSSAI directions to use Ethylene: Permits Ethylene for artificial ripening provided the concentration does
not exceed 100 ppm (parts per million). Any source of ethylene gas coming in direct contact with fruits is
not permitted.
• Hence option (b) is the correct answer.

Q 90.C
• Allocation Function of Government Budget:
• The government provides certain goods and services which cannot be provided by the market
mechanism i.e. by exchange between individual consumers and producers. Examples of such goods
are national defence, roads, government administration etc. which are referred to as public goods.
• To understand why public goods need to be provided by the government, we must understand the
difference between private goods such as clothes, cars, food items, etc. and public goods. There are two
major differences. One, the benefits of public goods are available to all and are not only restricted to
one particular consumer. For example, if a person eats a chocolate or wears a shirt, these will not be
available to others. It is said that this person’s consumption stands in rival relationship to the consumption
of others. However, if we consider a public park or measures to reduce air pollution, the benefits will be
available to all. One person’s consumption of a good does not reduce the amount available for
consumption for others and so several people can enjoy the benefits, that is, the consumption of many
people is not ‘rivalrous’.
• Two, in case of private goods anyone who does not pay for the goods can be excluded from enjoying its
benefits. If you do not buy a ticket, you will not be allowed to watch a movie at a local cinema
hall. However, in case of public goods, there is no feasible way of excluding anyone from enjoying
the benefits of the good. That is why public goods are called non-excludable. Even if some users do
not pay, it is difficult and sometimes impossible to collect fees for the public good. These nonpaying
users are known as ‘free-riders’. Consumers will not voluntarily pay for what they can get for free
and for which there is no exclusive title to the property being enjoyed. The link between the
producer and consumer which occurs through the payment process is broken and the government
must step in to provide for such goods. Hence, statement I is correct.
• There is, however, a difference between public provision and public production. Public provision O
C
means that they are financed through the budget and can be used without any direct payment.
Public goods may be produced by the government or the private sector. When goods are produced
S.

directly by the government it is called public production. Hence, statement II is not correct.
E

Q 91.C
T

• Payment banks:
O

o Unlike traditional banks, payment banks function under restricted parameters regulated by the
N

Reserve Bank of India (RBI) under specific guidelines.

o A committee headed by Dr. Nachiket Mor recommended setting up of 'Payments Bank' to cater to
F

the lower income groups and small businesses.

• Payment Banks Scope of Activities:
D

o Acceptance of demand deposits, initially restricted to holding a maximum balance of Rs 100,000 per
.P

individual customer now increased to Rs 200,000. Hence option 1 is correct.

o Can issue ATM/debit cards and offer52 other banking services like Net Banking Services and
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third-party Fund Transfers. Hence option 3 is correct.

o Payments and remittance services through various channels. Hence option 2 is correct.
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 o Distribution of non-risk sharing simple financial products like mutual fund units and insurance
products, etc.
o They are only allowed to invest the money received from customers' deposits into government
securities.
o They cannot issue credit cards.
o They are not allowed to give loans. They cannot accept NRI deposits. Hence option 4 is not
correct.
o A payment bank account holder would be able to deposit and withdraw money through any ATM or
other service provider.
o Payments licensees would be granted to mobile firms, supermarket chains, and others to cater to
individuals and small businesses.

Q 92.B
• The International Union for Conservation of Nature (IUCN) has released a report outlining a
roadmap for a Regenerative Blue Economy (RBE). IUCN has developed a framework defining three
types of Blue Economy with RBE at the highest sustainability level. Hence option (b) is the correct
answer.
• Regenerative Blue Economy:
o It is an economic model that combines effective regeneration and protection of the Ocean and marine
and coastal ecosystems with sustainable, low, or no carbon economic activities, and fair prosperity,
now and in the future.
o Founding principles for RBE would include:
o Protection, restoration, resilience, and regeneration of marine and coastal ecosystems, marine
resources, and natural capital as priorities.
o Prioritise inclusion, fairness, solidarity, well-being and resilience of the impacted population.
o Inclusive and participatory governance system with scientific assessments.
o Needs of coastal populations, and indigenous peoples must be taken into account.
o Certain activities are excluded from its scope either due to incompatibility with carbon reduction
objectives such as oil extraction, or threats to marine ecosystems such as deep-sea mining.

O
C
Q 93.B
• India is the world’s second-largest telecommunications market with a subscriber base of 1.16
S.

billion. The overall tele-density in India stands at 90.45%, the rural tele-density being 57.35% and urban
E

tele-density being 160.71 %. Hence statement 1 is correct.

o The number of internet subscribers in the country increased to 881.25 million as of March 2023.
T

o Around 759 million Indians are active internet users and access the internet at least once a month. The
O

active internet user base in India is expected to grow to 900 million by 2025.
• The cabinet allowed 100% foreign direct investment through the automatic route with safeguards.
N

Hence statement 2 is not correct.

F

o The Telecom sector is the 3rd largest sector in terms of FDI inflows, contributing 7.1% of total FDI
D

inflow
• Employment: The sector contributes directly to 2.2 mn employment and indirectly to 1.8 Mn jobs.
.P

• Debt ridden telecom sector: Analysts estimate industry debt at over 73.6 lakh crore. Large debts- telecom
53
sector is under a debt of around Rs. 4 lakh crores because of various investments related and other
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activities.
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 • High Spectrum usage charges (SUC): In India, the SUC charge continues in the range of 3% to 6% of the
revenue (AGR).
• A committee headed by Rajiv Gauba has been setup to help the struggling telecom sector.
• Recent Initiatives
o Bharat Net: To provide network infrastructure with affordable broadband connectivity on a non-
discriminatory basis to all households in the country.
o 5G Rollout: Prime Minister launched the 5G services on 1st Oct 2022. 5G network has been
rolled out in all 28 states and 8 UTs now. This is one of the fastest 5G rollouts in the world.
Hence statement 3 is correct.
o Prime Minister Wi-Fi Access network Interface (PM-WANI) Scheme: It aims to setup Public Wi-Fi
Networks through Public Data Offices (PDOs) spread across length and breadth of the country to
accelerate proliferation of Broadband Internet services.
o Production Linked Incentive (PLI) Scheme: It earmarks INR 12,195 Cr for manufacturing of telecom
and networking products. Further, incentives worth more than INR 4,000 Cr have been earmarked for
the Design Led Manufacturing Scheme of the existing PLI Scheme.

Q 94.B
• Lok Adalat is a unique and effective form of Alternative Dispute Resolution (ADR). Hence,
statement 1 is correct.
o It aims to resolve disputes amicably and expeditiously.
o It is a quasi-judicial forum where both parties to a dispute are brought together to settle their
differences with the assistance of a neutral third party called the Lok Adalat member.
• Lok Adalat is an alternative dispute resolution mechanism in India established under the Legal
Services Authorities Act, 1987. Hence, statement 2 is correct.
• Objectives:
o To provide speedy justice to parties
o To reduce the backlog of cases in courts
o To promote reconciliation and mutual understanding between parties
o To save time and expenses involved in litigation
• Key Features:
o Informal and Non-Adversarial: Proceedings are conducted in a friendly atmosphere without strict
rules of evidence or procedure.
o Quick and Speedy: Disputes are resolved within a short period of time, often on the same day.
o Free or Low Cost: Lok Adalats do not charge any fees or nominal fees are charged.
o Voluntary Participation: Parties are not obligated to participate in Lok Adalat, but it is highly
encouraged.
o Binding and Enforceable: Settlements reached in Lok Adalats are final and binding on the parties.
• The Karnataka High Court recently made a significant ruling, stating that Lok Adalat proceedings
are not judicial in nature. Hence, statement 3 is not correct.
o In Lok Adalats, the persons presiding over and deciding cases are known as Members of the Lok
Adalats.
o Unlike judges in regular courts, Members of Lok Adalats are not vested with judicial powers. O
C
o Instead, they act as statutory conciliators, whose primary role is to facilitate the resolution of
disputes through mediation and negotiation.
S.

o Their focus is on finding amicable solutions that are acceptable to both parties involved in the dispute.
E

o Members of Lok Adalats do not have the power to adjudicate cases or impose judgments.
T

Q 95.B
O

• Padta Bet-
o Archaeological excavation reveals a 5,200-year-old Harappan settlement at Padta Bet in Kachchh,
N

Gujarat. It is near Juna Khatiya, an Early Harappan necropolis (mass burial site).
F

o Evidence of occupation from early Harappan to Late Harappan periods: Pottery includes Ceramic
D

artifacts of novel kinds involving large storage jars, small bowls, and dishes.
o Artefacts, including semi-precious stone beads, made of carnelian and agate, terracotta spindle
.P

whorls, copper, lithic tools, etc.

o Remains of animal bones representing cattle,54 sheep goat and edible shell fragments, thereby indicating
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animal domestication.
o Hence, option (b) is the correct answer.
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Q 96.B
• Goods and Service Tax (GST) is the single comprehensive indirect tax, on the supply of goods and
services, right from the manufacturer/ service provider to the consumer. It is a destination-based
consumption tax with the facility of Input Tax Credit in the supply chain. It is applicable throughout the
country with one rate for one type of goods/service. It has amalgamated a large number of Central and
State taxes and cesses. It has replaced a large number of taxes on goods and services levied on the
production/ sale of goods or provision of service. Hence, statement is 1 not correct and statement 2 is
correct.

Q 97.A
• Important terms regarding inflation:
o Inflation: Inflation is a quantitative measure of how quickly the prices of goods in an economy are
increasing. Inflation occurs when goods and services are in high demand, thus creating a drop in
availability (supply) and a consequential raising of prices.
o Disinflation: It refers to a reduction in the rate of inflation. In disinflation, price levels decrease
without a decrease in National income, output and employment. Disinflation is generally
desirable. Hence, pair 1 is not correctly matched.
o Deflation: It refers to a persistent fall in the price level. It is a situation in which the price level
reduces along with fall in output, employment etc. It leads to recession. Hence, pair 2 is not
correctly matched.
o Reflation: It is a situation when the economy recovers from recession/depression. Price levels
increase along with an increase in output, employment, et during the phase of economic
recovery. Hence, pair 3 is correctly matched.

Q 98.A
• Harvest Festivals in India- India is the land of festivals, a colourful nation with joyous celebrations and
interesting mythological legends. Harvest festivals are those that occur at the time of the main harvest of a
particular region. Each of the 29 states of India celebrates its harvest festival at different times throughout
the year, owing to the diversity in climate and differences in the staple crop of a region. Bihu, Pongal,
Makara Sankranti, Lohri - the names and regions differ, but the significance of each is just one - to be
thankful for the bountiful harvest.
o Rongali/Bohag Bihu- Celebrated in Assam. It is celebrated in the middle of April, it marks the
beginning of the Assamese New Year and the onset of spring. There are 3 Bihu festivals in Assam.
Other two- Kati Bihu and Magh Bihu are celebrated in October and January respectively. It is a 7-day
festival, where the first day is called Goru Bihu followed by Manuh Bihu, Guxai Bihu etc. Hence,
pair 1 is not correctly matched.
o Puthandu - The traditional Tamil New Year is celebrated with a lot of pomp and grandeur. People
visit the temple and then prepare Pongal and Mango Pachadi at home. Hence, pair 2 is correctly
matched.
o Poila Boishak- Poila Boishak marks the start of the fresh Bengali New Year in West Bengal. On
this day, people start the festivities by visiting the temple and offering their puja. Then they prepare
Poila Boishak-special dishes at home which are then relished with friends and family. Hence, pair 3
is not correctly matched. O
C
o Vishu- It signifies the New Year of Kerela. The day starts for people at sunrise by looking at the
S.

Vishu Kani. Vishu Kani is an arrangement of rice, flowers, coins, fruits, books, dhoti, and other things
that is made by the eldest member of the family a day before. Hence, pair 4 is not correctly
E

matched.
T
O

Q 99.A
• Consumer Price Index (CPI):
N

o The Consumer Price Index (CPI) measures the change in the prices of goods and services from
the perspective of the consumer. It measures changes overtime in the general level of prices of
F

goods and services that households acquire for the sake of consumption. Hence, statement 1 is
D

correct.
o As wide disparity in the consumption baskets for different segments of consumers, 4 different CPIs
.P

are adopted by India: 55

W

▪ CPI (Industrial Workers): It is mainly used for determining Dearness Allowance paid to
central/state government employees and workers in the industrial sectors. It is compiled by the
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Labour Bureau with base year of 2016.

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 ▪ CPI (Urban Non-Manual Employees): This depicts the changes in the levels of average retail
prices of goods and services consumed by the urban segment of population . It was used to be
compiled with the base year of 1984-85 but has been discontinued since 2011 because of an
outdated base year and also CPI (urban) is brought out.
▪ CPI (Agricultural Labour): This index is used for revising minimum wages for agricultural
laborers in different states. It is compiled by the Labour Bureau with the base year of 1986-87.
▪ CPI (Rural Worker): It is proposed for determining minimum wages for the government's
rural jobs programme under the Mahatma Gandhi National Rural Employment Guarantee
Act (MGNREGA), though currently CPI-AL is used for determining MGNREGA wages. It
is too compiled by Labour Bureau with the base year of 1983. Hence, statement 2 is not
correct.

Q 100.B
• Key Concepts regarding unemployment calculations:
o Labour force includes people in the working age group 15-59 years who are able and willing to
work. It includes both work force (number of people working) and the unemployed. Hence,
statement 1 is not correct.
o Labour Force Participation Rate (LFPR) is defined as the percentage of persons in labour force (i.e.
working or seeking or available for work)in the population.
o Worker Population Ratio (WPR) is defined as the percentage of employed persons in the
population.
o Unemployment Rate (UR) is defined as the percentage of persons unemployed among the
persons in the labour force. Hence, statements 2 and 3 are correct.

O
C
S.
E
T
O
N
F
D
.P

56
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