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Editorials Quiz 2021-22
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Introducing yet another ingenious course, InsightsIAS is excited to announce our new initiative QUED – Questions from Editorials. Considering the number of questions that appeared from Editorials in previous year UPSC Prelims Examinations, we feel it is wise for students to cover Editorials from Prelims point of view as well in order to achieve that extra edge. Although, we have covered important editorials separately in our Editorial Section as well as under Secure Initiative, MCQ practice can prove to be crucial for better performance and guaranteed result.
We strongly recommend you at add QUED along with Static Quiz ,Current Affairs Quiz and RTM for your Daily MCQ practice.
We will be posting 5 MCQs at 11am everyday from Monday to Saturday on http://www.insightsonindia.com. QUED will be available under QUIZ menu.
We hope students utilize this initiative to the best of advantage. 🙂
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Question 1 of 5
Consider the following statements regarding coal gasification and its advantage.
- Coal gasification is the process of converting coal into syngas, which is a mixture of hydrogen, carbon monoxide and carbon dioxide.
- Low-grade coal cannot be used in the coal gasification process.
- It reduces dependence on imported Liquified Natural Gas.
Which of the above statements is/are correct?
CorrectSolution: b)
Coal gasification is the process of converting coal into synthesis gas (also called syngas), which is a mixture of hydrogen (H2), carbon monoxide (CO) and carbon dioxide (CO2). The syngas can be used in a variety of applications such as in the production of electricity and making chemical products, such as fertilisers.
According to the International Energy Agency’s Energy Technology Systems Analysis Programme (ETSAP), the coal gasification process holds good potential in the future, with coal being the most abundantly available fossil fuel across the world, and that even low-grade coal can be used in the process.
According to the Ministry of Chemicals and Fertilisers, urea is currently produced using pooled natural gas, which comprises of both domestic natural gas and imported LNG. The usage of locally available coal for making fertilisers would help reduce the import of LNG.
IncorrectSolution: b)
Coal gasification is the process of converting coal into synthesis gas (also called syngas), which is a mixture of hydrogen (H2), carbon monoxide (CO) and carbon dioxide (CO2). The syngas can be used in a variety of applications such as in the production of electricity and making chemical products, such as fertilisers.
According to the International Energy Agency’s Energy Technology Systems Analysis Programme (ETSAP), the coal gasification process holds good potential in the future, with coal being the most abundantly available fossil fuel across the world, and that even low-grade coal can be used in the process.
According to the Ministry of Chemicals and Fertilisers, urea is currently produced using pooled natural gas, which comprises of both domestic natural gas and imported LNG. The usage of locally available coal for making fertilisers would help reduce the import of LNG.
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Question 2 of 5
Consider the following statements.
- The Generalized System of Preferences (GSP) is a preferential tariff system wherein differential tariff could be imposed by a nation on various countries depending upon factors such as whether it is a developed country or a developing country.
- Generalized System of Preferences is outside the purview of WTO.
- India has an untapped export potential in the European Union (EU) and is among the least beneficiaries of the EU’s GSP.
Which of the above statements is/are correct?
CorrectSolution: a)
India has an untapped export potential of $39.9 billion in the EU and Western Europe. The top products with export potential include apparel, gems and jewellery, chemicals, machinery, automobile, pharmaceuticals and plastic. India benefits from tariff preferences under the EU’s Generalized System of Preferences (GSP) for several of these products. In fact, India is among the major beneficiaries of the EU’s GSP, with exports under the GSP valued at nearly $19.4 billion in 2019, accounting for nearly 37% of India’s merchandise exports to the EU.
The Generalized System of Preferences, or GSP, is a preferential tariff system which provides tariff reduction on various products. The concept of GSP is very different from the concept of “most favored nation” (MFN). MFN status provides equal treatment in the case of tariff being imposed by a nation but in case of GSP differential tariff could be imposed by a nation on various countries depending upon factors such as whether it is a developed country or a developing country. Both the rules comes under the purview of WTO.
IncorrectSolution: a)
India has an untapped export potential of $39.9 billion in the EU and Western Europe. The top products with export potential include apparel, gems and jewellery, chemicals, machinery, automobile, pharmaceuticals and plastic. India benefits from tariff preferences under the EU’s Generalized System of Preferences (GSP) for several of these products. In fact, India is among the major beneficiaries of the EU’s GSP, with exports under the GSP valued at nearly $19.4 billion in 2019, accounting for nearly 37% of India’s merchandise exports to the EU.
The Generalized System of Preferences, or GSP, is a preferential tariff system which provides tariff reduction on various products. The concept of GSP is very different from the concept of “most favored nation” (MFN). MFN status provides equal treatment in the case of tariff being imposed by a nation but in case of GSP differential tariff could be imposed by a nation on various countries depending upon factors such as whether it is a developed country or a developing country. Both the rules comes under the purview of WTO.
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Question 3 of 5
Consider the following statements.
- A barrier to trade is a government-imposed restraint on the flow of international goods or services.
- Capping foreign direct investment in sensitive sectors is a major example of trade barrier.
- Unreasonable tax on imports is a trade barrier.
Which of the above statements is/are correct?
CorrectSolution: c)
A barrier to trade is a government-imposed restraint on the flow of international goods or services. The most common barrier to trade is a tariff—a tax on imports. Tariffs raise the price of imported goods relative to domestic goods (goods produced at home).
An import quota is a type of protectionist trade restriction that sets a physical limit on the quantity of a good that can be imported into a country in a given period of time.
FDI is related to the capital sector and overall investment policy of the nation. FDI is not considered a trade component.
Statement 3: Such standards can effectively clog imports from competitor nations, for e.g. China in case of India.
IncorrectSolution: c)
A barrier to trade is a government-imposed restraint on the flow of international goods or services. The most common barrier to trade is a tariff—a tax on imports. Tariffs raise the price of imported goods relative to domestic goods (goods produced at home).
An import quota is a type of protectionist trade restriction that sets a physical limit on the quantity of a good that can be imported into a country in a given period of time.
FDI is related to the capital sector and overall investment policy of the nation. FDI is not considered a trade component.
Statement 3: Such standards can effectively clog imports from competitor nations, for e.g. China in case of India.
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Question 4 of 5
An inverted duty structure for a particular product will tend to discourage its
- Domestic value addition
- Associated Foreign Direct Investment
- Import of finished goods as compared to its raw material
Select the correct answer code:
CorrectSolution: a)
Inverted duty structure is a situation where import duty on finished goods is low compared to the import duty on raw materials that are used in the production of such finished goods.
For example, suppose the tariff (import tax) on the import of tyres is 10% and the tariff on the imports of natural rubber which is used in the production of tyres is 20%; this is a case of inverted duty structure.
When the import duty on raw materials is high, it will be more difficult to produce the concerned good domestically at a competitive price. Several industries depend on imported raw materials and components. High tax on the raw materials compels them to raise price.
The disadvantage of the inverted duty structure increases with the increased use of imported raw materials. An inverted duty structure discourages domestic value addition.
On the other hand, foreign finished goods will be coming at a reduced price because of low tax advantage. In conclusion, manufactured goods by the domestic industry becomes uncompetitive against imported finished goods.
In such a case, even foreign investors would not be interested in setting up a firm for production in the country.
Statement 3: It will be just the opposite.
IncorrectSolution: a)
Inverted duty structure is a situation where import duty on finished goods is low compared to the import duty on raw materials that are used in the production of such finished goods.
For example, suppose the tariff (import tax) on the import of tyres is 10% and the tariff on the imports of natural rubber which is used in the production of tyres is 20%; this is a case of inverted duty structure.
When the import duty on raw materials is high, it will be more difficult to produce the concerned good domestically at a competitive price. Several industries depend on imported raw materials and components. High tax on the raw materials compels them to raise price.
The disadvantage of the inverted duty structure increases with the increased use of imported raw materials. An inverted duty structure discourages domestic value addition.
On the other hand, foreign finished goods will be coming at a reduced price because of low tax advantage. In conclusion, manufactured goods by the domestic industry becomes uncompetitive against imported finished goods.
In such a case, even foreign investors would not be interested in setting up a firm for production in the country.
Statement 3: It will be just the opposite.
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Question 5 of 5
India-EU “Broad Based Trade and Investment Agreement (BTIA)” negotiations cover:
- Trade in Goods and Service
- Sanitary and Phytosanitary Measures
- Government Procurement
- Sustainable Development
Select the correct code:
CorrectSolution: d)
On 28th June 2007, India and the EU began negotiations on a broad-based Bilateral Trade and Investment
Agreement (BTIA) in Brussels, Belgium. It is yet to materialise due to lack of concurrence in areas like automotives and dairy and marine products.
The negotiations cover Trade in Goods, Trade in Services, Investment, Sanitary and Phytosanitary
Measures, Technical Barriers to Trade, Trade Remedies, Rules of Origin, Customs and Trade
Facilitation, Competition, Trade Defence, Government Procurement, Dispute Settlement, Intellectual
Property Rights & Geographical Indications, Sustainable Development.
IncorrectSolution: d)
On 28th June 2007, India and the EU began negotiations on a broad-based Bilateral Trade and Investment
Agreement (BTIA) in Brussels, Belgium. It is yet to materialise due to lack of concurrence in areas like automotives and dairy and marine products.
The negotiations cover Trade in Goods, Trade in Services, Investment, Sanitary and Phytosanitary
Measures, Technical Barriers to Trade, Trade Remedies, Rules of Origin, Customs and Trade
Facilitation, Competition, Trade Defence, Government Procurement, Dispute Settlement, Intellectual
Property Rights & Geographical Indications, Sustainable Development.
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