Indian Economy MCQs
Indian Economy Multiple Choice Questions (MCQs) for SSC, State and all One Day Examinations of India. Objective Questions on Indian Economy for competitive examinations.
11. Which state in India is the largest producer of salt?
[A] Kerala
[B] Andhra Pradesh
[C] Gujarat
[D] Maharashtra
Show Answer
Correct Answer: C [Gujarat]
Notes:
Gujarat is the largest producer of salt in India because of its extensive dry coast. Gujarat accounts for 77% of the salt produced in our country. Salt industries of Gujarat are thriving in Surat, Kutch, Bhavnagar, Rajkot, Anand, etc.
12. In which city is Banaras Locomotive Works (BLW) located?
[A] Kanpur
[B] Lucknow
[C] Agra
[D] Varanasi
Show Answer
Correct Answer: D [Varanasi]
Notes:
Banaras Locomotive Works (BLW), formerly known as Diesel Locomotive Works, is located in Varanasi, Uttar Pradesh. BLW was established in 1956. It is the largest locomotive manufacturing facility in India. The unit was renamed BLW in October 2020. BLW manufactures electric locomotives including WAP-7 and WAG-9 models. The factory exports locomotives to countries like Sri Lanka, Myanmar, and Mozambique.
13. Which of the following is also regarded as Disguised unemployment?
[A] Under employment
[B] Frictional unemployment
[C] Seasonal unemployment
[D] Cyclical unemployment
Show Answer
Correct Answer: A [Under employment]
Notes:
Under employment is a condition in which people in labor force are employed at less than full time or require regular job or at jobs inadequate with respect to training or economic need.
14. How much per cent of the total assets of the company should be deployed in the infrastructure loans?
[A] 75%
[B] 60%
[C] 80%
[D] 50%
Show Answer
Correct Answer: A [75%]
Notes:
As per RBI, any non-banking financial company can be registered as an Infrastructure Finance Company, subject to minimum, 75% of the total assets of the company, should be deployed in the infrastructure loans.
15. What is the main aim of India’s 2023 Foreign Trade Policy?
[A] Export promotion and import substitution only
[B] Export promotion, import regulation, and $2 trillion exports by 2030
[C] Import-oriented manufacturing and domestic consumption
[D] None of the above
Show Answer
Correct Answer: B [Export promotion, import regulation, and $2 trillion exports by 2030]
Notes:
India’s Foreign Trade Policy 2023 targets $2 trillion in exports by 2030. The policy emphasizes export promotion, import regulation, sectoral diversification, digitization, and improved infrastructure. Key initiatives include RoDTEP, PM Gati Shakti, and Bharat Trade Net. The policy aims to boost MSME contribution, encourage e-commerce, align with global standards, and promote ease of doing business.
16. Which was the largest part of non-plan expenditure in 1991-92? (UPSC Prelims 1992)
[A] Subsidies on fertilizer
[B] Compensation to banks for loan waiving
[C] Interest payment
[D] Compensation for PSU losses
Show Answer
Correct Answer: C [Interest payment]
Notes:
In 1991-92, interest payments were the largest non-plan expenditure, estimated at Rs. 27,450 crores, surpassing other items like subsidies and compensations. This reflected the high fiscal burden due to accumulated government debt and was a key reason for economic reforms initiated that year.
17. Which among the following is not a sunrise industry?
[A] Information technology
[B] Food Processing
[C] Healthcare
[D] cotton industry
Show Answer
Correct Answer: D [cotton industry]
Notes:
Sunrise industry is a term used for a sector that is just in its infancy but shows promise of a rapid boom. The industry is typically characterized by high growth rates, a high degree of innovation, and generally has plenty of public awareness about the sector, and investors get attracted to its long-term growth prospects.
Except for the cotton industry, all the others are part of the sunrise industry as the cotton industry is not a new industry in India.
18. What is the major challenge hindering India’s economic development in 2026?
[A] High population
[B] Poor infrastructure
[C] Less exports
[D] Market imperfections
Show Answer
Correct Answer: B [Poor infrastructure]
Notes:
Poor infrastructure is the main hindrance to India’s economic growth in 2026, affecting manufacturing (12.5% of GDP), FDI inflow, labor reforms, and land acquisition reforms. Despite growth in GDP and services exports, infrastructure deficits persist as the primary barrier over high population or export volumes.
19. What is the ideal N:P:K ratio for the soil?
[A] 3:2:1
[B] 5:2:1
[C] 8:2:1
[D] 4:2:1
Show Answer
Correct Answer: D [4:2:1]
Notes:
The ideal N(Nitrogen):P(Phosphorous):K(Potassium) ratio. for the top soil is 4:2:1
20. Which oilseeds are used in the Manufacturing of paints?
[A] Linseed
[B] Groundnut
[C] Castor
[D] None of the above
Show Answer
Correct Answer: A [Linseed]
Notes:
Linseed (Alsi in Hindi) has a unique drying property and is suitable for the manufacturing of paints, varnishes, printing ink etc. A small part is used as edible oil also.