Indian Economy MCQs

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Among the major consuming sectors, fertilizers account for the largest share of natural gas consumption in India. Gas is used extensively in fertilizer plants, especially for ammonia and urea production, making this sector the biggest user. City Gas Distribution is also a major consumer, but its share is lower than fertilizers. Power production and refineries consume significant quantities too, yet they do not exceed the fertilizer sector in overall gas use.

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Printing of currency, also called monetizing the debt, is generally treated as the last resort in deficit financing. It means the government meets its deficit by creating new money, usually through central bank support. This method is avoided as far as possible because it can fuel inflation and weaken macroeconomic stability. Hence, governments prefer borrowing and other non-inflationary sources before resorting to currency creation.

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Under FERA, foreign exchange was not limited to foreign currency notes alone. It also covered financial instruments such as traveler’s cheques, letters of credit and bills of exchange when these were expressed or drawn in Indian currency but made payable in a foreign currency. Since each of the listed instruments fits that description, all three are included. Therefore, the correct answer is all of the above.

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Coal accounted for about 70% of India’s electricity generation in 2025. Coal-based power output was 1,247 TWh in 2025 after a 3.4% decline. Non-fossil sources contributed 25% collectively in FY 2024-25. India added 35 GW solar in 2025, but total renewable generation reached 270 TWh compared to coal’s 1,247 TWh.

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Salem Steel Plant is located in Tamil Nadu. It was established in 1972 and commissioned in 1982. The Second Five Year Plan was from 1956 to 1961. Bhilai, Durgapur, and Rourkela steel plants were constructed during the Second Five Year Plan. Salem Steel Plant was not constructed during that period.

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Thermal power plants in India use large volumes of water mainly for cooling and steam production. The Central Electricity Authority monitors water consumption by thermal power stations annually. Compared to paper, textiles, and engineering, thermal power contributes the highest industrial water use. India’s thermal electricity generation capacity exceeds 230 GW as of 2023, making it the major industrial water consumer.

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Padmanabhaswamy Temple is located in Thiruvananthapuram, Kerala, India. The temple is built in an intricate fusion of the indigenous Kerala style and the Tamil style of architecture.

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Financial inclusion in India refers to providing affordable financial services such as payments, savings, credit, and insurance. The Reserve Bank of India has promoted financial inclusion through initiatives like Jan Dhan Yojana, launched in 2014, to increase banking penetration and usage. Financial inclusion is essential in India’s economic and social policy frameworks as per RBI guidelines and government mandates.

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A centrally planned economy is an economic system in which the state or government makes economic decisions rather than the these being made by the interaction between consumers and businesses.

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The Reserve Bank of India revised the framework for IDF-NBFCs on 18 August 2023 and withdrew the requirement of a sponsor. Under the present rules, an IDF-NBFC does not need to be sponsored by a bank or any other entity. This change was made to simplify regulation and allow IDF-NBFCs greater flexibility in financing infrastructure projects. Therefore, the correct answer is that no sponsor is required.