Indian Economy MCQs

Notes:
The variable reserve ratio device springs from the fact that the central bank, in its capacity as Bankers Bank, must hold a part of the cash reserves of commercial banks. The customary minimum cash reserve ratio is an important limitation on the lending capacity of banks.

Notes:
The Eighth Five-Year Plan (1992-1997) was the first plan implemented after India introduced economic reforms in 1991. The plan focused on indicative planning, market-led economy, liberalization, privatization, and globalization. India’s membership in the World Trade Organization began in January 1995 during this plan. Previous plans were based on centralized state control and public sector dominance.

Notes:
Trade unions are a key feature of the organised sector, providing collective bargaining, better wages, and improved benefits. Their absence would be a disadvantage, not an advantage. Organised sector workers also enjoy fixed working hours, job security, and safer working conditions.

Notes:
The unemployment resulting from industrial reorganization, typically due to technological change, rather than fluctuations in supply or demand.

Notes:
Soil health card is a printed report which contains the nutrient status of soil with respect to 12 nutrients: pH, Electrical Conductivity (EC), Organic Carbon (OC), Nitrogen (N), Phosphorus (P), Potassium (K), Sulphur (S), Zinc (Zn), Boron (B), Iron (Fe), Manganese (Mn), Copper (Cu) of farm holdings. It will be provided for every 3 years.

Notes:
The Food Corporation of India historically borrowed from the National Small Savings Fund (NSSF) to finance food subsidy shortfalls. In the Union Budget 2021-22, the Government of India discontinued NSSF loans to FCI for food subsidy. During 2020-21, the government repaid about Rs 1.5 lakh crore of NSSF loans. Since FY22, FCI receives subsidy via direct budget allocations.

Notes:
On October 24, 2024, the Mudra Yojana maximum loan limit was revised to Rs 20 lakh under the Tarun Plus category. The increase to Rs 20 lakh was announced in the July 2025 budget. The standard Tarun category continues to offer loans up to Rs 10 lakh. The Tarun Plus category is for entrepreneurs with a record of timely repayment under the Tarun category.

Notes:
ASPIRE (A Scheme for Promotion of Innovation, Rural Industries and Entrepreneurship) was launched in 2015 by the Ministry of Micro, Small and Medium Enterprises. The scheme intends to set up Livelihood Business Incubators and Technology Business Incubators, generate employment in agro-rural sectors, promote entrepreneurship, and support creation of micro-enterprises. By 2023, 109 LBIs were approved across India.

Notes:
The government increased the maximum turnover limit for startup recognition under Startup India from ₹100 crore to ₹200 crore in February 2026. Startups must operate as private limited companies, limited liability partnerships, or registered partnerships to qualify. The Startup India initiative was launched in 2016 by the Government of India to support entrepreneurship and innovation across the country.

Notes:
India supplies about 20% of global generic medicines as of 2023, making it the largest supplier worldwide. The Indian pharmaceutical industry consists of over 10,000 manufacturing facilities. India provides around 40% of generic drugs used in the United States and about 33% in the United Kingdom. The sector includes over 3,000 pharmaceutical companies. The country is often called the “pharmacy of the world.”