Expected Questions on Economics 2018 – Part 2 (Set - 1) (Download PDF)

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Credit Lines Pact Signed by Five Banks of BRICS Nations - BRICS Interbank Cooperation Mechanism (ICM) Banks agreed to establish and cooperate on local currency credit lines. Allows 5 banks to extend credit lines in local currencies to: BRICS ICM members, BRICS companies against guarantees of signatory banks.

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Expected Questions on Economics 2018 - UPSC IAS Prelims (Part 2) (In English)

Dr. Manishika Jain discusses Expected Questions on Economics 2018 for IAS Prelims Part 2

  • 👌 These five banks are:

    • Brazilian Development Bank

    • Russia’s Vnesheconom bank

    • Export-Import Bank of India (EXIM)

    • China Development Bank

    • Development Bank of South Africa

Public Sector Banks Allowed to Amalgamate Through Alternative Mechanism (AM)

  • Public Sector Banks can now amalgamate through an Alternative Mechanism (AM).

  • Facilitating consolidation of Nationalized Banks into strong and competitive banks.

Process of Amalgamation:

  • Decision for creating strong and competitive banks.

  • Based solely on commercial considerations.

  • Proposal must start from the Boards of Banks.

  • Proposals from Banks for scheme of amalgamation is to be placed before the Alternative Mechanism (AM).

  • After in-principle approval, Banks to further process as dictated by law and SEBI’s requirements.

India’s Exclusive Rights to Explore Polymetallic Nodules from Central Indian Ocean Seabed Basin

  • India’s exclusive rights to explore polymetallic nodules from seabed in Central Indian Ocean Basin (CIOB) extended by five years.

  • Rights over 75000 sq. km of area in international waters allocated by International Seabed Authority for developmental activities for polymetallic nodules.

  • Estimated polymetallic nodule resource potential is 380 million tons containing:

    • 4.7 million tons of nickel

    • 4.29 million tons of copper

    • 0.55 million tons of cobalt

    • 92.59 million tons of manganese

Textile Industry in India: Institutional Mechanism for Textiles Sector

  • Ministry of Textiles set up institutional mechanisms.

  • To enable textile industry achieve full potential of production, exports and employment.

  • To implement key recommendations emerging from the deliberations at Textiles India Ministry of Textiles.

  • Set up following institutional mechanisms:

  • Knowledge Network Management System on Product Diversification.

  • Inter-Ministerial Synergy Group on Man-Made Fibre (MMF)

  • Task Force on Textiles India

  • Textiles India 2017 held at Gandhinagar, Gujarat from 30th June 2017 to 2nd July 2017.

  • 👌 Largest ever international trade event in Textile Sector.

👌 Renard Series for Currency Denominations

  • Countries use the Renard series for convenient use of currency.

  • The ratio between adjacent denominations of currencies is 1: 2 or 1: 2.5.

  • Denomination should be twice or two and half times of its preceding denomination.

  • Allowing exchange of value ordinarily in a maximum of three denominations.

1 - 2-5 Series- RBS’s Variation on Renard Series

  • To determine Indian currency denominations, RBI follows a variation of the Renard Series.

  • 👌 Called the 1 - 2-5 series where a ‘decade’ or a 1: 10 ratio is covered in 3 steps.

  • First number in the series would be 1, the second would be 2, and the third would be 5.

  • Thus, we have currency notes of 1, 2, 5, 10, 20, 50, 100, 200, 500, 1000……etc.

  • New bright yellow 200-rupee the missing link in the RBI’s modified Renard Series.

👌 1 Billion-1 Billion -1 Billion Vision

  • 1 billion unique Aadhaar numbers linked to 1 billion bank accounts

  • 1 billion mobile phones making India part of financial and digital mainstream.

Impact on Black money: Quantum jump in enforcement actions based on demonetization data

  • Searches 158 % increase in number of searches (from 447 to 1152 groups)

  • 106 % increase in seizures (from Rs. 712 crore to Rs. 1469 crore)

  • 38 % increase in admission of undisclosed income (from Rs. 11, 226 crore to Rs. 1, 54, 96 crore)

Aggregate Measurement of Support (AMS): Joint Proposal by India & China in WTO

Image of Aggregate Measurement of Support

Image of Aggregate Measurement of Support

Image of Aggregate Measurement of Support

  • 👌 India and China jointly asked for elimination of Aggregate Measurement of Support (AMS) or ‘Amber Box’ to the World Trade Organisation (WTO).

  • These are most trade distorting forms of farm subsidies given by developed countries.

  • Important proposal by India and China for upcoming 11th Ministerial Conference of the WTO.

  • To be held in Buenos Aires in December 2017.

  • Counters efforts to remove subsidies of the developing countries.

  • While, letting the developed countries retain their huge farm subsidies.

What Are Micro ATMs, What They Do, and How They Could Help Solve the Cash Crunch

  • Installing ATMs in rural areas is unviable for banks due to:

    • lower number of accounts

    • low volume of transactions

    • low value of transactions

    • high cost of setting up an ATM

  • Micro ATMs provide a one-stop solution bringing secure ATM services to the unbanked rural areas.

  • 👌 Micro ATM however cannot provide ‘anytime’ money.

  • It requires a banking correspondent (an employee) to assist the transaction.

  • Micro ATM will close down if the Banking Correspondent is not available when the account holder requires funds.

Features of Micro ATMs:

  • Portable

  • Ideal for banking outreach initiatives

  • Activated at a fraction of the cost of ATM machines

  • Compatible with regional languages

  • Prints out a receipt

India, Bhutan Signed New Bilateral Trade Agreement

Bilateral trade agreement in New Delhi to improve ease of doing trade.

Aims of Agreement:

  • Cutting down on documentation.

  • Adding additional exit.

  • Entry points for Bhutan’s trade with other countries.

  • Strengthen the relations between the two countries.

Union Government Unveiled UDAN Scheme for Regional Air Connectivity

  • Union ministry launched the regional air connectivity scheme known as UDAN (Ude Desh ka Aam Naagrik) to increase affordability of flying.

  • In January, 2017 this scheme was rolled out for operation for a 10 years.

  • Major stimulus to tourism and employment generation in the hinterland.

  • Reduces travel timings in remote and mountainous regions as well as islands and other areas of the country.

  • Objective of the UDAN scheme: “Ude Desh ka Aam naagrik”

3 Mega Hydro Projects in Himachal Pradesh

  • Prime Minister Narendra Modi inaugurated three hydroelectric projects (HEPs).

  • With a generating capacity of 1, 732 MW in Himachal Pradesh.

  • These 3 power projects use generating equipment supplied.

  • Commissioned by state owned Bharat Heavy Electricals Limited (BHEL).

  • Narendra Modi addressed a rally in Mandi town.

  • This project will collectively play expand the Hydropower sector of Himachal Pradesh.

👌 Three Hydro-Electric Projects:

  • Koldam HEP

  • Parbati HEP

  • Rampur HEP

Importance of Hydro-Projects:

  • Renewable source of energy.

  • Not produce greenhouse gas emission achieving the low carbon path.

  • Hydropower potential of around 1, 45, 000 MW is in India and it has 60 % load factor.

  • Only around 26 % of Hydropower capacity is currently exploited in India.

What is Arbitration, Arbitration & Conciliation Act 1996

  • Justice Srikrishna Committee, a High Level Committee.

  • Reviewing Institutionalization of Arbitration Mechanism submitted its report.

  • The Arbitration and Conciliation Act 1996 regulates domestic arbitration in India.

  • Effective arbitration inspires the confidence of Foreign Investors.

  • Also, increases reliability of the legal system for expeditious, cheaper and flexible dispute resolution.

  • Arbitration is effective and expeditious dispute resolution framework unlike the Court proceedings.

  • Parties submit themselves to Arbitration for faster resolution and disposal of the disputes.

Government Expanding Logistics Data Bank Project to South India

Expand Logistics Data Bank (LDB) project to southern region after covering the western logistics corridor.

Logistics Data Bank (LDB) Project:

  • 👌 Launched at Jawaharlal Nehru Port (JNPT), Mumbai in 2016.

  • Expanded container terminals at Adani Port Special Economic Zone (APSEZ), Mundra and Adani Hazira Port in Gujarat.

  • Made India’s logistics sector more efficient by Information Technology.

  • Every container in the port facility is attached to Radio Frequency Identification Tag (RFID). Then, tracked through RFID readers.

Benefits of the LDB Project:

  • Cut the overall lead time of container movement.

  • Reduced transaction costs incurred by consignees and shippers.

  • Aided importers and exporters in tracking their goods.

  • Major improvement in ‘ease of doing business’ initiative.

  • Will help in boosting India’s foreign trade and ensuring greater transparency.

What Are Anti-Dumping and Countervailing Duties and Difference?

  • Anti-dumping (AD) & Countervailing (CVD) duties enforced to protect local manufactures- they are protectionist.

  • Anti-Dumping:

    • Dumping occurs when foreign manufacturers sell their goods at less than fair market value.

    • Injuring domestic industry potentially putting it out of business.

  • Countervailing:

    • Similar to Anti-dumping with one significant difference - countervailing Duties (CVD) established.

    • When a foreign government provides assistance and subsidies to local exporting manufacturers such as tax breaks enabling foreign exporter to sell goods cheaper than domestic manufacturers.

👌 Mechanism of Anti-dumping and Countervailing Duty

  • Imposed under multilateral WTO regime.

  • In India, duties are recommended by the Union Ministry of Commerce (i. e. by DGAD).

  • Imposed by the Union Finance Ministry.

India Imposes Anti-dumping Duty on Some Stainless Steel Imports

  • Union Finance Ministry (Department of Revenue) imposed anti-dumping duty on some cold-rolled flat products of stainless steel rom China, US, South Korea and European Union.

  • To curb the influx of cheaper imports and help local producers.

  • Duty will be in effect till December 2020.

  • It exempts certain grades of stainless steel.

  • However, government allowed import of product as long as end use of the import is in same form.

National Trade Facilitation Action Plan

  • The Union Government released 76-point National Trade Facilitation Action Plan (NTFAP).

  • To be adopted by the National Committee on Trade Facilitation (NCTF).

  • Reflecting commitment to implement the Trade Facilitation Agreement (TFA).

Objectives of National Trade Facilitation Action Plan: Achieve improvement in ease of doing business by:

  • Reduce cargo release time and cost

  • Transparent, and predictable legal regime

  • Move towards paperless regulatory environment

  • Improve investment climate through better infrastructure

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Expected Questions on Economics 2018 - UPSC IAS Prelims (Part 2) (In Hindi)

Dr. Manishika Jain discusses Expected Questions on Economics 2018 for IAS Prelims Part 2

👌 implies important for Objective Questions/MCQ

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📹 implies covered in Videos or Upcoming Videos

- Published/Last Modified on: May 11, 2018

Economy

Monthy-updated, fully-solved, large current affairs-2019 question bank(more than 2000 problems): Quickly cover most-important current-affairs questions with pointwise explanations especially designed for IAS, NTA-NET, Bank-PO and other competetive exams.