Indian Economy Questions and Answers

Answer: C

It is an enterprise owned jointly by the private and public sectors.

The joint sector, recommended by the Dutt Committee, brings government and private capital and management together in one company, usually with the state holding around 26 per cent. It was intended to combine private efficiency with public accountability.

Answer: D

The NSSO was established in 1950.

Set up on P.C. Mahalanobis's initiative, it conducts nationwide sample surveys on consumption expenditure, employment and other socio-economic subjects, and its rounds are the basis of India's poverty and employment estimates. It became part of the National Statistical Office in 2019.

Answer: B

The co-operative credit societies have a three-tier structure.

Primary agricultural credit societies at village level, central co-operative banks at district level, and a state co-operative bank at the apex. Long-term credit runs through a parallel two-tier structure of land development banks.

Answer: A

Bihar has the lowest per capita income.

Its per capita income is roughly a third of the national average and the lowest among the major states. The reasons include a very high population density, little industry, and the loss of the mineral belt when Jharkhand was carved out in 2000.

Answer: C

India's largest trading partner is the United States.

Bilateral trade in goods and services runs to well over $150 billion a year, and India runs a surplus with the US - unlike its trade with China, where the deficit is large. The US is the biggest single destination for Indian exports.

Answer: B

Central banking functions are performed by the Reserve Bank of India alone.

The RBI issues currency, acts as banker to the government and to the banks, manages the exchange rate and controls credit. The Central Bank of India, the State Bank of India and Punjab National Bank are commercial banks, whatever their names suggest.

Answer: A

The system was abolished on 31 March 1997.

Ad hoc treasury bills let the government finance its deficit automatically by issuing bills to the RBI, which amounted to unlimited monetisation. An agreement between the government and the RBI ended the practice and replaced it with Ways and Means Advances of limited amount and duration.

Answer: D

All of these have happened.

Co-operatives brought rural credit within an organised institutional framework, replaced the moneylender's arbitrary terms with regulated procedures, and lent at rates far below the traditional ones. The movement's weakness has been recovery rather than reach.

Answer: A

The base year was 1993-94.

The Wholesale Price Index series with this base was introduced in 1999, replacing the 1981-82 series. It was later revised to 2004-05 and then to 2011-12, each revision widening the basket to reflect changes in the structure of production.

Answer: D

Regional rural banks were established in 1975.

The first five were set up on 2 October 1975 following the Narasimham Working Group, to combine the local knowledge of a co-operative with the discipline of a commercial bank. Their capital is shared between the Centre, the sponsor bank and the state.