UPSC IAS Archives

41. Consider the following pairs : Region often in news Country

Consider the following pairs :

Region often in news	Country
1. Chechnya	Russian Federation
2. Darfur	Mali
3. Swat Valley	Iraq

Which of the above pairs is/are correctly matched?

1 only

1 and 2 only

2 and 3 only

1, 2 and 3

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UPSC IAS – 2014

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The question asks which of the given pairs are correctly matched regarding the region and the country they are located in. Let’s examine each pair:
1. Chechnya: This region is a federal subject of Russia, officially known as the Chechen Republic within the Russian Federation. This pair is correctly matched.
2. Darfur: Darfur is a region in western Sudan, Africa. It is not located in Mali, which is a separate country in West Africa. This pair is incorrectly matched.
3. Swat Valley: The Swat Valley is located in the Khyber Pakhtunkhwa province of Pakistan. It is not located in Iraq, which is in the Middle East. This pair is incorrectly matched.

– Chechnya is part of the Russian Federation.
– Darfur is a region in Sudan.
– Swat Valley is in Pakistan.

Knowing the geographical locations of regions frequently mentioned in international news related to conflicts, political issues, or natural disasters is important for competitive exams. Chechnya has been associated with separatist movements and conflict with Russia. Darfur is known for its long-standing conflict and humanitarian crisis in Sudan. The Swat Valley in Pakistan has been affected by insurgency and military operations.

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42. Consider the following countries : 1. Denmark 2. Japan 3. Russian F

Consider the following countries :

1. Denmark

2. Japan

3. Russian Federation

4. United Kingdom

5. United States of America

Which of the above are the members of the ‘Arctic Council’?

1, 2 and 3

2, 3 and 4

1, 4 and 5

1, 3 and 5

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UPSC IAS – 2014

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The correct option is D. Denmark, Russian Federation, and United States of America are members of the ‘Arctic Council’.

The Arctic Council is a high-level intergovernmental forum that provides a mechanism to address issues faced by the Arctic governments and the indigenous people of the Arctic. Its member states are the eight countries that have territory within the Arctic Circle.

The eight member states are: Canada, Denmark (representing Greenland and the Faroe Islands), Finland, Iceland, Norway, Russian Federation, Sweden, and the United States (representing Alaska). From the given options, Denmark (via Greenland), Russian Federation, and United States of America are the members. Japan and the United Kingdom are not Arctic countries and are therefore not members, although they hold observer status along with several other non-Arctic states.

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43. Recently, a series of uprisings of people referred to as ‘Arab Spring’

Recently, a series of uprisings of people referred to as ‘Arab Spring’ originally started from

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Egypt

Lebanon

Syria

Tunisia

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UPSC IAS – 2014

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The correct option is D. The series of uprisings referred to as ‘Arab Spring’ originally started from Tunisia.

The Arab Spring was a series of anti-government protests, uprisings, and armed rebellions that spread across much of the Arab world in the early 2010s. It began in Tunisia on December 18, 2010, following the self-immolation of Mohamed Bouazizi, a street vendor, in protest against police harassment and corruption.

The Tunisian protests led to the overthrow of President Zine El Abidine Ben Ali in January 2011, inspiring similar movements in other Arab countries, including Egypt, Libya, Syria, Yemen, Bahrain, and others. While significant events occurred in Egypt (leading to the fall of Mubarak), Libya (civil war), and Syria (ongoing civil war), the initial spark and successful overthrow of a long-standing regime first occurred in Tunisia.

44. In the context of Indian economy, which of the following is/are the pu

In the context of Indian economy, which of the following is/are the purpose/purposes of ‘Statutory Reserve Requirements’?

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1. To enable the Central Bank to control the amount of advances the banks can create
2. To make the people’s deposits with banks safe and liquid
3. To prevent the commercial banks from making excessive profits
4. To force the banks to have sufficient vault cash to meet their day-to-day requirements

Select the correct answer using the code given below.

1 only

1 and 2 only

2 and 3 only

1, 2, 3 and 4

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UPSC IAS – 2014

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The correct option is B. The purposes of ‘Statutory Reserve Requirements’ (CRR and SLR) include enabling the Central Bank to control the amount of advances banks can create and making people’s deposits with banks safe and liquid.

Statutory Reserve Requirements, specifically the Cash Reserve Ratio (CRR) and Statutory Liquidity Ratio (SLR), are monetary policy tools used by the Central Bank (RBI).
1. By requiring banks to hold a portion of their deposits as reserves (cash with RBI for CRR, approved securities for SLR), the RBI limits the amount of funds banks have available for lending, thereby influencing credit creation and controlling the money supply. This directly enables the Central Bank to control the amount of advances banks can create.
2. CRR and SLR ensure that banks maintain a certain percentage of their liabilities in highly liquid assets (cash or approved securities), making a portion of the depositors’ funds safe and available if needed, thus enhancing the safety and liquidity of deposits.

3. Preventing commercial banks from making excessive profits is not the primary objective of reserve requirements. While controlling lending can indirectly impact profitability, the main goals are monetary stability, inflation control, and depositor protection.
4. Reserve requirements mandate holdings with the RBI (CRR) or in specific assets (SLR), not necessarily in the bank’s own vault cash for day-to-day requirements. Banks manage their day-to-day liquidity needs through other means, although reserve requirements do contribute to overall liquidity.

45. What is/are the facility/facilities the beneficiaries can get from the

What is/are the facility/facilities the beneficiaries can get from the services of Business Correspondent (Bank Saathi) in branchless areas?

1. It enables the beneficiaries to draw their subsidies and social security benefits in their villages.
2. It enables the beneficiaries in the rural areas to make deposits and withdrawals.

Select the correct answer using the code given below.

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1 only

2 only

Both 1 and 2

Neither 1 nor 2

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The correct option is C. Both statements 1 and 2 describe facilities that beneficiaries can get from the services of Business Correspondents (Bank Saathi) in branchless areas.

Business Correspondents (BCs), also known as Bank Saathis, are retail agents appointed by banks to provide banking services in remote locations where establishing brick-and-mortar branches is not viable. Their main role is to promote financial inclusion by extending banking services to the underserved population, particularly in rural areas.

1. BCs enable beneficiaries of government schemes, pensions, and other social security benefits to receive their payments conveniently in their villages, often using biometric authentication.
2. BCs provide basic banking services like account opening, cash deposits, cash withdrawals, balance enquiry, and fund transfers through micro-ATMs or other digital devices at or near the customer’s location in rural areas.
Both facilities are core functions aimed at bringing banking services to the doorstep of people in unbanked or underbanked regions.

46. The terms ‘Marginal Standing Facility Rate’ and ‘Net Demand and Time L

The terms ‘Marginal Standing Facility Rate’ and ‘Net Demand and Time Liabilities’, sometimes appearing in news, are used in relation to

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banking operations

communication networking

military strategies

supply and demand of agricultural products

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The correct option is A. The terms ‘Marginal Standing Facility Rate’ and ‘Net Demand and Time Liabilities’ are used in relation to banking operations.

Marginal Standing Facility (MSF) is a facility under which scheduled commercial banks can borrow additional funds overnight from the Reserve Bank of India (RBI) by dipping into their Statutory Liquidity Ratio (SLR) portfolio up to a certain limit. The MSF Rate is the interest rate charged by the RBI for this facility, and it is a key monetary policy tool. Net Demand and Time Liabilities (NDTL) represent the total liabilities of a bank (deposits, borrowings, etc.) minus its deposits with other banks and other approved assets. It is the base on which banks’ reserve requirements like the Cash Reserve Ratio (CRR) and Statutory Liquidity Ratio (SLR) are calculated by the RBI.

Both MSF Rate and NDTL are specific terms used in the context of banking regulations, monetary policy, and the operations conducted by commercial banks under the purview of the central bank (RBI) in India. They are not related to communication networking, military strategies, or supply and demand of agricultural products.

47. With reference to Balance of Payments, which of the following constitu

With reference to Balance of Payments, which of the following constitutes/constitute the Current Account?

1. Balance of trade
2. Foreign assets
3. Balance of invisibles
4. Special Drawing Rights

Select the correct answer using the code given below.

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1 only

2 and 3

1 and 3

1, 2 and 4

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The correct option is C. The Balance of Trade and Balance of Invisibles constitute the Current Account of the Balance of Payments.

The Balance of Payments (BoP) is a statement of all transactions made between entities in one country and the rest of the world over a specific period. It is divided into two main accounts: the Current Account and the Capital Account. The Current Account records transactions in goods, services, income (like remittances, interest, dividends), and current transfers (like gifts, grants).

1. Balance of Trade: Exports minus imports of *goods* (visible trade). This is a component of the current account.
2. Foreign assets: These relate to investments and reserves, which are recorded in the Capital Account or Financial Account (often considered part of the Capital Account structure).
3. Balance of Invisibles: Exports minus imports of *services* and net income and net transfers. This is a component of the current account.
4. Special Drawing Rights (SDRs): These are reserve assets held by countries with the IMF and changes in SDR holdings are typically recorded in the Capital Account or as part of reserve assets, not current transactions.
Therefore, only 1 and 3 are components of the Current Account.

48. The main objective of the 12th Five-Year Plan is

The main objective of the 12th Five-Year Plan is

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inclusive growth and poverty reduction

inclusive and sustainable growth

sustainable and inclusive growth to reduce unemployment

faster, sustainable and more inclusive growth

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The correct option is D. The main objective of the 12th Five-Year Plan (2012-2017) was ‘Faster, Sustainable and More Inclusive Growth’.

The 12th Five-Year Plan was the last of India’s Five-Year Plans. Its central theme and stated objective were “Faster, Sustainable and More Inclusive Growth”. This expands upon the “Inclusive Growth” objective of the 11th Plan by adding the dimensions of speed and sustainability, recognizing the need for not just equity but also environmental considerations and a higher growth rate to achieve development goals.

The 11th Five-Year Plan (2007-2012) had the objective “Towards Faster and More Inclusive Growth”. The 12th Plan built upon this by emphasizing sustainability alongside speed and inclusiveness.

49. What does venture capital mean?

What does venture capital mean?

A short-term capital provided to industries

A long-term start-up capital provided to new entrepreneurs

Funds provided to industries at times of incurring losses

Funds provided for replacement and renovation of industries

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The correct option is B. Venture capital means a long-term start-up capital provided to new entrepreneurs.

Venture capital is a form of private equity financing that is provided by venture capital firms or funds to start-ups, early-stage, and emerging companies that have been deemed to have high growth potential or which have demonstrated high growth. It is characterized by being a long-term investment, usually in equity, and is provided to fund initial operations or expansions of new ventures.

Venture capital is typically associated with high risk due to the early stage of the companies invested in, but it offers the potential for proportionally high returns if the ventures are successful. It is not short-term capital, nor is it primarily intended for companies already incurring losses (though start-ups often do in their early phase) or for replacement/renovation of established industries.

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50. The sales tax you pay while purchasing a toothpaste is a

The sales tax you pay while purchasing a toothpaste is a

tax imposed by the Central Government

tax imposed by the Central Government but collected by the State Government

tax imposed by the State Government but collected by the Central Government

tax imposed and collected by the State Government

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UPSC IAS – 2014

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The correct option is D. The sales tax you pay while purchasing a toothpaste is a tax imposed and collected by the State Government (in the pre-GST era or as a conceptual understanding).

Prior to the implementation of the Goods and Services Tax (GST) in India, Sales Tax (or Value Added Tax – VAT) on the sale of goods within a state was a state subject. This meant that the power to levy and collect sales tax on intra-state sales rested with the State Government, as per the State List (List II) of the Seventh Schedule of the Constitution of India.

With the advent of GST (implemented from July 1, 2017), most indirect taxes, including Sales Tax/VAT, Central Sales Tax, Service Tax, etc., were subsumed into a single tax. Under GST, tax on an intra-state sale is bifurcated into Central GST (CGST) and State GST (SGST), both levied simultaneously. However, the question refers to “sales tax,” implying the pre-GST regime or a general understanding of the tax on sales, which was a state domain.

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