External Sector, Trade and Currency — UPSC Prelims PYQs

Q1. Which of the following is/are the most significant implication(s) of obtaining Oeko-Tex certification for Eri Silk in the global textile industry ?
1. It allows Indian exporters to compete in high-end markets that prioritise chemical-free products.
2. It confirms that Eri Silk meets international safety, environmental, and quality standards, enabling its entry into premium eco-conscious markets.
Select the answer using the code given below : UPSC Prelims 2026

Question 1 optionsA1 onlyB2 onlyCBoth 1 and 2DNeither 1 nor 2
Q2. Consider the following statements :
1.
2. rice and wheat.
Which of the statements given above is/are correct ? UPSC Prelims 2024

Question 2 optionsA1 onlyB2 onlyCBoth 1 and 2DNeither 1 nor 2
Q3. Consider the following statements :
Statement–I : India accounts for 3·2% of global export of goods.
Statement–II : Many local companies and some foreign companies operating in India have taken advantage of India's 'Production-linked Incentive' scheme.
Which one of the following is correct in respect of the above statements? UPSC Prelims 2023

Question 3 optionsABoth Statement–I and Statement–II are correct and Statement–II is the correct explanation for Statement–IBBoth Statement–I and Statement–II are correct and Statement–II is not the correct explanation for Statement–ICStatement–I is correct but Statement–II is incorrectDStatement–I is incorrect but Statement–II is correct
Q4. With reference to the Indian economy, consider the following statements :
1. An increase in Nominal Effective Exchange Rate (NEER) indicates the appreciation of rupee.
2. An increase in the Real Effective Exchange Rate (REER) indicates an improvement in trade competitiveness.
3. An increasing trend in domestic inflation relative to inflation in other countries is likely to cause an increasing divergence between NEER and REER.
Which of the above statements are correct ? UPSC Prelims 2022

Question 4 optionsA1 and 2 onlyB2 and 3 onlyC1 and 3 onlyD1, 2 and 3
Q5. Consider the following :
1. Foreign currency convertible bonds
2. Foreign institutional investment with certain conditions
3. Global depository receipts
4. Non-resident external deposits
Which of the above can be included in Foreign Direct Investments? UPSC Prelims 2021

Question 5 optionsA1, 2 and 3B3 onlyC2 and 4D1 and 4
Q6. Consider the following statements : The effect of devaluation of a currency is that it necessarily
1. improves the competitiveness of the domestic exports in the foreign markets
2. increases the foreign value of domestic currency
3. improves the trade balance
Which of the above statements is/are correct? UPSC Prelims 2021

Question 6 optionsA1 onlyB1 and 2C3 onlyD2 and 3
Q7. If another global financial crisis happens in the near future, which of the following actions/policies are most likely to give some immunity to India ?
1. Not depending on short-term foreign borrowings
2. Opening up to more foreign banks
3. Maintaining full capital account convertibility
Select the correct answer using the code given below : UPSC Prelims 2020

Question 7 optionsA1 onlyB1 and 2 onlyC3 onlyD1, 2 and 3
Q8. With reference to Foreign Direct Investment in India, which one of the following is considered its major characteristic ? UPSC Prelims 2020

Question 8 optionsAIt is the investment through capital instruments essentially in a listed company.BIt is a largely non-debt creating capital flow.CIt is the investment which involves debt-servicing.DIt is the investment made by foreign institutional investors in the Government securities.
Q9. With reference to Trade-Related Investment Measures (TRIMS), which of the following statements is/are correct ?
1. Quantitative restrictions on imports by foreign investors are prohibited.
2. They apply to investment measures related to trade in both goods and services.
3. They are not concerned with the regulation of foreign investment.
Select the correct answer using the code given below : UPSC Prelims 2020

Question 9 optionsA1 and 2 onlyB2 onlyC1 and 3 onlyD1, 2 and 3
Q10. Consider the following statements :
1. The value of Indo-Sri Lanka trade has consistently increased in the last decade.
2. “Textile and textile articles” constitute an important item of trade between India and Bangladesh.
3. In the last five years, Nepal has been the largest trading partner of India in South Asia.
Which of the statements given above is/are correct ? UPSC Prelims 2020

Question 10 optionsA1 and 2 onlyB2 onlyC3 onlyD1, 2 and 3
Q11. Consider the following statements :
1. Most of India’s external debt is owed by governmental entities.
2. All of India’s external debt is denominated in US dollars.
Which of the statements given above is/are correct? UPSC Prelims 2019

Question 11 optionsA1 onlyB2 onlyCBoth 1 and 2DNeither 1 nor 2
Q12. In the context of India, which of the following factors is/are contributor/contributors to reducing the risk of a currency crisis?
1. The foreign currency earnings of India’s IT sector
2. Increasing the government expenditure
3. Remittances from Indians abroad
Select the correct answer using the code given below. UPSC Prelims 2019

Question 12 optionsA1 onlyB1 and 3 onlyC2 onlyD1, 2 and 3
Q13. Among the agricultural commodities imported by India, which one of the following accounts for the highest imports in terms of value in the last five years? UPSC Prelims 2019

Question 13 optionsASpicesBFresh fruitsCPulsesDVegetable oils
Q14. Which one of the following is not the most likely measure the Government/RBI takes to stop the slide of Indian rupee? UPSC Prelims 2019

Question 14 optionsACurbing imports of non-essential goods and promoting exportsBEncouraging Indian borrowers to issue rupee denominated Masala BondsCEasing conditions relating to external commercial borrowingDFollowing an expansionary monetary policy

0 of 14 answered

External Sector, Trade and Currency — UPSC Prelims PYQs

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