UPSC Indian Economy Test 6 (Old Year Questions)

Ans a
The World Economic Forum (WEF) is a Geneva-based non-profit foundation best known for its annual meeting in Davos, Switzerland which brings together top business leaders, international political leaders, selected intellectuals and journalists to discuss the most pressing issues facing the world including health and the environment. The World Economic Forum was founded in 1971 by Klaus M. Schwab, a business professor in Switzerland.

Ans c
The first telegraph line was opened in 1851 between Kolkata and Diamond Habour. By March 1884, telegraph message could be sent from Agra to Kolkata. The first automatic telephone exchange was commissioned at Shimla in 1913-14. Kandla Free Trade Zone in the first export-processing zone in India that has been set up in the year 1965. Seven other zones were later established in Mumbai, Chennai, Surat, Falta, Kochi, Noida and Vizag.

Ans c
Prior to 1972, there were over 100 Insurance Companies-Indian and foreign. The conditions of service of the employees of these companies were governed by the respective contracts of service between the companies and the employees. On 13th May 1971, the Government of Indian assumed management of these general insurance companies under the General Insurance (Emergency Provisions) Act, 1971. The General Insurance Business (Nationalization) Act, 1972 nationalized general insurance business. State Bank of India (SBI) was nationalized in July 1955 under the SBI Act of 1955. Nationalization of Seven State Banks of India (formed subsidiary) took place on 19th July, 1960. The Banking Regulation Act was passed as the Banking Companies Act 1949 and came into force wef 16.3.49. Subsequently it was changed Banking Regulations Act 1949 wef 01.03.66. The first Indian Prime Minister, Jawaharlal Nehru presented the first five-year plan to the Parliament of India on December 8, 1951

Ans d
Direct tax is a tax or a kind of charge that is imposed directly to taxpayer and cannot be shifted on to others.
Corporation tax,
Income tax,
Securities transaction tax,
Banking Cash Transaction tax,
Fringe Benefit tax,
Wealth tax,
Interest tax,
Gift tax Indirect taxes in 2006-07 (in the order of their collection): (a) Union Excise duty, (b) Custom duty, (c) Service tax

Ans c
The Fifth Five Year Plan of India was chalked out for the period spanning 1974 to 1979 with the objectives of increasing the employment level, reducing poverty, and attaining self-reliance. The Indian Emergency of 25 June 1975 – 21 March 1977 was a 21-month period (during the fifth five year plan period), when President Fakhruddin Ali Ahmed, upon advice by Prime Minister Indira Gandhi, declared a state of emergency under Article 352 of the Constitution of India, effectively bestowing on her the power to rule by decree, suspending elections and civil liberties. On January 23, 1977, Indira Gandhi called fresh elections for March and released all political prisoners. Emergency officially ended on March 23, 1977. The Janata Party’s 295 seats (of a total 542) gave it only a slim majority, but opposition candidates together represented more than two-thirds of the Lok Sabha. Morarji Desai became the first non-Congress Prime Minister of India.

Ans d
Swawlamban (NORAD) Scheme is being implemented by the Department of Women and Child Development, Government of India with partial assistance from Norway since 1982. Its basic objective is to provide training and skill to women to facilitate them obtain employment or self-employment on a sustained basis. The target group under the scheme are the poor and needy women, women from weaker sections of the society, such as Scheduled Castes and Scheduled Tribes, etc. Financial assistance is provided to undertake training programmes for women in both traditional as well as non-traditional trades.

Ans b
Participatory Notes are the instruments issues by SEBI – registered foreign institutions to entities that want to invest in Indian markets but do not want to directly register with the market, resulting in concealment of the investor’s identity.

Ans c
MCA 21: World Bank funded e-governance project to open a chain of 53 front offices of Registrar of Companies where the companies and professionals would be able to file returns and documents in the electronic mode (Ministry of Company Affairs).

Ans a
Contribution of different sectors to the GDP of India – Services – 11.2 Industry – 10 Agriculture – 2.7

Ans c
Vizag steel plant in AP has been conferred the Mini Ratna status. The Union Cabinet approved SAIL (Steel Authority of India Ltd.) to initiate the process of merger of IISCO (Indian Iron and Steel Company) with SAIL offer taking approval of the Board of Industrial and Financial Reconstruction (BIFR)

Ans b
National Housing Bank was set up in 1988 as a wholly owned subsidiary of the RBI, to promote housing finance institutions at local and regional level.

Ans d
Food Grains Production (mt) Rice 89.88 Wheat 71.54 Coarse Cereals 34.67 Pulses 13.92

Ans a
Balance of payments represent a better picture of a country’s economic transactions with the rest of the world than ‘Balance of Trade’ as it includes both visible (balance of trade) and invisible items

Ans c
Drinking Water Supply is one of the six components of Bharat Nirman, which has been conceived as a plan to be implemented in four years from 2005-06 to 2008-09 for building Rural infrastructure. Minimum Wage in relation to any area, means the minimum wage fixed by the State Government under Section 3 of the Minimum Wages Act, 1948 for agricultural labourers as applicable in that area.

Ans c
Fiscal Responsibility and Budget Management Act (FRBMA), 2003 concerns both fiscal and revenue deficit. Under this Act, the Government should annually reduce the revenue deficit by atleast 0.5 percent and fiscal deficit by 0.3 percent beginning with fiscal year 2004-05 to reach targets of 0 percent and 3.5 percent of Revenue and Fiscal deficits respectively by 2008-09.

Ans c
The Federal Bank became a Scheduled commercial bank in 1970. The Corporation bank (1906) and the Vijaya bank were nationalized on 15th April 1980, while the Dena bank (1938) was nationalized in July 1969.

Ans b
Service tax is an indirect tax levied by the Central Government. Direct Taxes: Personal Income Tax, Corporate Income Tax (30%), Securities Transaction Tax, Minimum Alternate Tax (10% o Book profits), Banking Cash Transaction Tax, Gift Tax, Expenditure Tax, Frinz benefit Tax, Wealth Tax. Indirect Taxes: Customs duty (12.5%), Excise duty, Service Tax (12%).

Ans b
Statements 2 and 3 are correct. National Development Council (NDC) is the Supreme decision making body of planning for social and economic development. Secretary of the Planning Commission acts as the Secretary to the NDC and social and economic planning is listed in the Concurrent list.

Ans b
Kelkar Committee, 2002 Report recommended for increasing the exemption limit of personal income to Rs. 1.50 lakh, for widows and senior citizens.

Ans c
The National Housing Bank is wholly owned subsidiary of the RBI and the SIDBI is a subsidiary to IDBI.