Tag: international economics

Questions Related to international economics

Select the correct statement/statements using the code given below:
1. Industrial lockouts caused by the striking contractual labour has increased during the last $5$ years, which indicates immediate need of labour reforms in India pending since long.
2. Increasing labour unrest in India is emerging as the main determinant in attracting FDI. 

economics international economics indian economy during reforms liberalization, privatisation and globalisation: an appraisal structural changes in indian economy after liberalization

  1. Only I

  2. Only 2

  3. I and 2

  4. Neither 1 nor 2

Show answer
Correct Option: D
Explanation:

Both the statements are incorrect. The number of strikes and lockouts show a decreasing trend at least in the instances of lockouts, in the country. Labour unrest in India is not seen as a major deterrent in attracting FDI to the country. 

Regional disparity in per capita income in India has increased in the post reform period due to many factors. Which among the following factors has not contributed to the growth in such disparity?

economics international economics indian economy during reforms liberalization, privatisation and globalisation: an appraisal structural changes in indian economy after liberalization

  1. Decline in the share of public investment.

  2. Change in policy regime regulating investment locations.

  3. Poor governance and poor infrastructure.

  4. Allocation of central government funds through the award of finance commission.

Show answer
Correct Option: D

Growth in GDP during reform period was mainly driven by growth in _______.

economics international economics indian economy during reforms liberalization, privatisation and globalisation: an appraisal structural changes in indian economy after liberalization

  1. service sector

  2. agriculture sector

  3. industrial sector

  4. both A and C

Show answer
Correct Option: A
Explanation:

Growth in GDP during reform period was mainly driven by the growth in the service sector. During the reform period, the growth of agriculture and industrial sectors has declined whereas the growth of service sector has gone up.

As a result of foreign investment _____________.

economics international economics indian economy during reforms liberalization, privatisation and globalisation: an appraisal structural changes in indian economy after liberalization

  1. India has seen a tremendous rise in new technology

  2. India is the fifth largest foreign exchange reserve holder in the world

  3. rising prices could not be kept under control

  4. all of the above

Show answer
Correct Option: A
Explanation:
The opening up of the economy has led to rapid increase in foreign direct investment and foreign exchange reserves. At present, India is the sixth largest foreign exchange reserve holder in the world. Rising prices have also been kept under control. and India has seen tremendous rise in new technology.

Foreign investment includes ________.

economics international economics indian economy during reforms liberalization, privatisation and globalisation: an appraisal structural changes in indian economy after liberalization

  1. FDI

  2. FII

  3. both A and B

  4. none of the above

Show answer
Correct Option: C
Explanation:
The foreign investment includes foreign direct investment and foreign institutional investment.

Developing countries don't have access to developed countries market because _______.

economics international economics indian economy during reforms liberalization, privatisation and globalisation: an appraisal structural changes in indian economy after liberalization

  1. high non-tariff barriers like quota restriction

  2. inability to produce

  3. lack of labour

  4. none of the above

Show answer
Correct Option: A
Explanation:
A developing country like India still does not have the access to developed countries’ markets because of high non-tariff barriers. For example, although all quota restrictions on exports of textiles and clothing have been removed from India, U.S.A. has not removed their quota restriction on import of textiles from India and China.

Which of the following is true regarding disinvestment?

economics international economics indian economy during reforms liberalization, privatisation and globalisation: an appraisal structural changes in indian economy after liberalization

  1. Assets of PSUs were sold at correct value

  2. Proceeds from disinvestment were used to build social infrastructure

  3. Proceeds from disinvestment were used to offset the shortage of government revenues

  4. There was a substantial loss to the government due to disinvestment

Show answer
Correct Option: C,D
Explanation:
The assets of PSUs have been undervalued and sold to the private sector. This means that there has been a substantial loss to the government. Moreover, the proceeds from disinvestment were used to offset the shortage of government revenues rather than using it for the development of PSUs and building social infrastructure in the country.

Which of the following led to decline in industrial growth?

economics international economics indian economy during reforms liberalization, privatisation and globalisation: an appraisal structural changes in indian economy after liberalization

  1. Decreasing demand of domestic products

  2. Domestic manufacturers were facing competition from imports

  3. Inadequate investment in infrastructure

  4. All of the above

Show answer
Correct Option: D
Explanation:
Industrial growth has recorded a slowdown. This is because of decreasing demand of industrial products due to various reasons such as cheaper imports, inadequate investment in infrastructure etc. Cheaper imports have replaced the demand for domestic goods. Domestic manufacturers are facing competition from imports.

At present, India is the _______ largest foreign exchange reserve holder in the world.

economics international economics indian economy during reforms liberalization, privatisation and globalisation: an appraisal structural changes in indian economy after liberalization

  1. fifth

  2. sixth

  3. seventh

  4. eighth 

Show answer
Correct Option: D
Explanation:
The opening up of the economy has led to rapid increase in foreign direct investment and foreign exchange reserves. At present, India is the sixth largest foreign exchange reserve holder in the world.

Which of the following led to the Sircilla tragedy?

economics international economics indian economy during reforms liberalization, privatisation and globalisation: an appraisal structural changes in indian economy after liberalization

  1. Hike in prices of cloth

  2. Hike in power tariff

  3. Both A and B

  4. Insufficient labour

Show answer
Correct Option: B
Explanation:
As a part of liberalisation, privatisation and globalisation, the government hiked the power tariff. Further, while the power sector reforms have led to hike in tariffs, the power producers have failed in providing quality power to the powerloom industry. Since the wages of the powerloom workers are linked to the production of cloth, power-cut means cut in wages of weavers who were already suffering from hike in tariff. This led to a crisis in the livelihood of the weavers.