Economics · Banking Financial Awareness

Indian Economy and Policy

1,777 Questions

Indian economy and policy questions cover the structural dynamics and regulatory measures shaping the national market. Topics include foreign direct investment, taxation reforms, and government initiatives for growth. This section is highly relevant for competitive exams requiring economic awareness.

Foreign direct investmentGST impactEconomic reformsTrade policyGovernment economic initiatives

Indian Economy and Policy Questions

Multiple choice history economic system and economic policies american dominance, neo-imperialism and new economic policy insights on lpg changing economic policies

The New Industrial Policy announced on July 24, 1991 contained provisions relating to _________.

  1. industrial licensing

  2. foreign investment

  3. foreign technology policy

  4. all of the above
Reveal answer Fill a bubble to check yourself
D Correct answer
Explanation

On July 24, 1991, Government of India announced its new industrial policy with an aim to correct the distortion and weakness of the Industrial Structure of the country that had developed in 4 decades; raise industrial efficiency to the international level; and accelerate industrial growth. The NIP does away with licensing for all major industries, irrespective of the investment level, proposes liberal foreign investment, dispenses with the Monopolies and Restrictive Trade Practices (MRTP)  clearances but curbs unfair trade practices and emphasis technological up-gradation.

Hence, D is the correct option.

Multiple choice history economic system and economic policies american dominance, neo-imperialism and new economic policy insights on lpg changing economic policies

India has witnessed a number of acute problems immediately prior to implementation of economic reforms in early $1990$'s. Among the following, which one was severe and unmanageable?

  1. Industrial backwardness

  2. Balance of payments crisis

  3. Backwardness of agriculture

  4. Shortage of food grains
Reveal answer Fill a bubble to check yourself
B Correct answer
Explanation

India was facing major BOP deficit issues since $1985$ and had borrowed from international bodies heavily to solve to BOP problem. However, it kept on rising and by the end of 1990 it turned in to serious crisis like situation. The foreign exchange reserves were at an all time low and the IMF refused to provide further assistance.

Multiple choice history economic system and economic policies american dominance, neo-imperialism and new economic policy insights on lpg changing economic policies

Which of the following factors are largely responsible for industrial sickness in India?
$1$. Faulty planning
$2$. Mismanagement
$3$. Inadequate equity capital
$4$. Outdated technology
Select the correct answer using the codes given.

  1. $1, 2$ and $3$
  2. $2, 3$ and $4$
  3. $1, 2$ and $4$
  4. $1, 3$ and $4$
Reveal answer Fill a bubble to check yourself
B Correct answer
Explanation

The factors, which are responsible for industrial sickness in India, are mismanagement, inadequate equity capital and outdated technology.

Multiple choice history economic system and economic policies american dominance, neo-imperialism and new economic policy insights on lpg changing economic policies

Which of the following were short-term measures in the NEP?

  1. Structural reform measures

  2. Stabilisation measures

  3. Both A and B

  4. None
Reveal answer Fill a bubble to check yourself
B Correct answer
Explanation
India agreed to the conditionalities of World Bank and IMF and announced the New Economic Policy (NEP). The NEP consisted of wide ranging economic reforms. This set of policies can broadly be classified into two groups: the  stabilisation measures and the structural reform measures. Stabilisation measures are short term measures, on the other hand, structural reform policies are long-term measures.
Multiple choice history economic system and economic policies american dominance, neo-imperialism and new economic policy insights on lpg changing economic policies

Which policy was announced when India agreed to the conditionalities imposed by IMF and IBRD?

  1. Fiscal policy

  2. New Economic Policy

  3. Exim Policy

  4. None of the above
Reveal answer Fill a bubble to check yourself
B Correct answer
Explanation

In 1991, facing a balance of payments crisis, India sought assistance from the IMF and World Bank. The conditionalities imposed led to the adoption of the New Economic Policy, which introduced liberalisation, privatisation, and globalisation.

Multiple choice history economic system and economic policies american dominance, neo-imperialism and new economic policy insights on lpg changing economic policies

What did NEP focus on?

  1. Create a more competitive environment

  2. Remove barriers to entry

  3. Create employment

  4. Both A and B
Reveal answer Fill a bubble to check yourself
D Correct answer
Explanation
India agreed to the conditionalities of World Bank and IMF and announced the New Economic Policy (NEP). The NEP consisted of wide ranging economic reforms. The thrust of the policies was towards creating a more competitive
environment in the economy and removing the barriers to entry and growth of firms. Creation of employment was not the objective of NEP.
Multiple choice history economic system and economic policies american dominance, neo-imperialism and new economic policy insights on lpg changing economic policies

Which of the following were long-term measures in the NEP?

  1. Structural reform measures

  2. Stabilisation measures

  3. Both A and B

  4. None
Reveal answer Fill a bubble to check yourself
A Correct answer
Explanation

India agreed to the conditionalities of World Bank and IMF and announced the New Economic Policy (NEP). The NEP consisted of wide ranging economic reforms. This set of policies can broadly be classified into two groups: the  stabilisation measures and the structural reform measures. Stabilisation measures are short term measures, on the other hand, structural reform policies are long-term measures.

Multiple choice history economic system and economic policies american dominance, neo-imperialism and new economic policy insights on lpg changing economic policies

 _______ is/are the ways towards liberalization.

  1. Privatisation

  2. Liberalize economic policies.

  3. Financial sector reforms.

  4. All of the above
Reveal answer Fill a bubble to check yourself
D Correct answer
Explanation
Ways towards liberalization are:
1) Privatization: It refers to the sale or transfer of public assets to the private ownership.
2) Liberalize economic policies: Restriction from economic policies were abolished and liberalized in the global arena with the global market orientation.
3) Financial sector reforms: Financial sector was reformed in favor of liberalization.
Multiple choice history economic system and economic policies american dominance, neo-imperialism and new economic policy insights on lpg changing economic policies

Which one of the following is not a element of Industrial policy of India since 1991 ?

  1. Removal of entry barriers

  2. Reservation of areas reserved exclusively for the public sector

  3. Public sector monopoly for power development

  4. Liberalisation for foreign investment policy
Reveal answer Fill a bubble to check yourself
C Correct answer
Explanation

Removal of entry barriers , public sector monopoly for power development and liberation of foreign investment policy were the main elements of industrial policy of India since 1991.

Multiple choice indian land resources land resources of karnataka land utilisation, its pattern and crops of karnataka geography

Land reforms programme in India has aimed at

  1. Fragmentation of holdings

  2. Subdivision of holdings

  3. Consolidation of holdings

  4. Collection of holdings
Reveal answer Fill a bubble to check yourself
C Correct answer
Explanation

Land reforms programme in India has aimed at Consolidation of holdings.
The foremost important objective of land reforms in India is to make provision for more rational use of scarce land resources. It can be done by changing the conditions of holdings, ceilings on land holdings. This helps cultivation process in a most economical manner without any wastage of land, labour and capital.

Multiple choice history government, society and culture under the delhi sultanate life under delhi sultanate arab invasions and delhi sultanate royal dynasties of rajasthan and mughals

Which of the following is not one of the features of the economic regulations of Alauddin Khalji?

  1. Use of correct measures

  2. Prices fixed being calculated on the basis of production cost

  3. Total curbing of black marketing

  4. Organisation of separation markets for separate commodities
Reveal answer Fill a bubble to check yourself
D Correct answer
Explanation

Alauddin Khalji was very ambitious and to fulfil his ambition he was in need of a strong army. To manage the expenditure of army, he introduced the market controlling policy. He fixed the prices of goods. He set up a special department Shahna -i-Mandi. This department was responsible to look after royal granary,  This department supervised the market and kept an eye on weight and measures. Nobody was allowed to buy more than half a mound of corn at a time.

Multiple choice history government, society and culture under the delhi sultanate life under delhi sultanate arab invasions and delhi sultanate royal dynasties of rajasthan and mughals

The most important feature in the economic measures pursued by Alauddin Khilji was __________.

  1. Foreign trade

  2. Market control

  3. Minting of new coins

  4. Development of agriculture
Reveal answer Fill a bubble to check yourself
B Correct answer
Explanation

Market Control was one of the most important features of the Alauddin Khilji economic reforms. Under this policy, he fixed the prices for a wide range of goods, including grains, pulses, cloth, cattle, horses etc. Even the prices of slaves were also fixed. 

Multiple choice business organisation and correspondence meaning and factors of business environment dimensions of business environment business environment and its dimensions business environment

Demonetization and GST are examples of changes in ________.

  1. political environment

  2. social environment

  3. technological environment

  4. global environment
Reveal answer Fill a bubble to check yourself
A Correct answer
Explanation

Demonetization and GST are examples of changes in political environment. Political environment of a country gets influenced by the political organizations. Demonetization and GST are classified under political environment since these reforms are taken by the government of India..

Multiple choice civics foreign trade in india the government and economic development indian economy on the eve of independence impact of technology on livelihoods

The goal of making the economy more market-oriented and expanding the role of private and foreign investment is called _________.

  1. globalization

  2. nationalization

  3. liberalization

  4. none of the above
Reveal answer Fill a bubble to check yourself
C Correct answer
Explanation

Economic liberalization of India was initiated in the year 1991. The main goal of liberalization is to make economy more market oriented with expanded role of private and foreign investment. The former prime minister P V Narasimha Rao spearheaded economic liberalization policies in the early 1990s.