CSP 2015 Indian Economy Key Test 3 dt. 31.12.2014

CSP 2015 Indian Economy Key Test 3 dt. 31.12.2014

1.	a	11.	c	21.	d	31.	a	41.	d	51.	b
2.	b	12.	d	22.	d	32.	b	42.	c	52.	a
3.	c	13.	c	23.	a	33.	a	43.	c	53.	b
4.	b	14.	b	24.	b	34.	d	44.	b	54.	a
5.	d	15.	a	25.	d	35.	a	45.	c	55.	d
6.	b	16.	d	26.	d	36.	d	46.	a	56.	b
7.	b	17.	c	27.	b	37.	a	47.	c	57.	b
8.	b	18.	c	28.	d	38.	b	48.	d	58.	a
9.	a	19.	b	29.	d	39.	d	49.	b	59.	d
10.	d	20.	d	30.	c	40.	b	50.	d	60.	d

                                              

Explanation:

1. The term Second Green Revolution [SGR] was used by the then PM, Man Mohan Singh in 93rd Science Conference, 2006.  The SGR aims to focus on dry land farming, Small and marginal farmers and to bridge the regional imbalances which the First Green Revolution [FGR] fails to achieve. It seeks to raise food grain production to 400 million tons of by 2020. The term Evergreen Revolution is coined by renowned agricultural scientist, Dr. MS Swaminathan. This concept emphasizes on organic culture or green agriculture with the help of integrated pest management [IPM], integrated nutrient supply and integrated natural resource management. This is to achieve sustainability in agriculture.

8. e-Biz is one of the integrated services projects and part of the 27 Mission Mode Projects (MMPs) under the National E-Governance Plan (NEGP) of the Government of India. E-Biz is being implemented by Infosys Technologies Limited (Infosys) under the guidance and aegis of Department of Industrial Policy and Promotion (DIPP), Ministry of Commerce & Industry, Government of India. The focus of e-Biz is to improve the business environment in the country by enabling fast and efficient access to Government-to-Business (G2B) services through an online portal. This will help in reducing unnecessary delays in various regulatory processes required to start and run businesses. It is GOI initiative and therefore it is not designed on a PPP model.  

9. Soil Health Card Scheme is a scheme launched by the GOI in 2015, under the Ministry of Agriculture. The scheme aims at helping farmers in improving productivity by appropriate use of nutrients or fertilizers. 

Feature of the Soil Health Card

It would contain all basic information and crop-wise recommendations of nutrients or fertilizers required for farms of different soil types. It will carry crop-wise recommendation of fertilizers required for farm lands and other inputs to increase the productivity of individual farmer.
Government's step to issue soil health cards to farmers will ensure that they are aware of the quality of soil and use right fertilizers. Also, the scheme will help in keeping a check on overuse of fertilizers on farm land and will be provided to over 14 crore farmers. Apart from this, the Prime Minister also gave a slogan Swasth Dharaa Khet Haraa (Healthy Earth Green Farm). He also asked states to set up high-powered expert committees on agriculture and asked farmers to take agricultural decisions after getting their soil tested under the Soil Health Card scheme.
Background
The Soil Health Card scheme was announced in the first budget presented by Union Finance Minister Arun Jaitley in July 2014. The finance minister allotted a budget of 100 crore rupees for issuing cards and an additional 56 crore rupees to set up 100 mobile soil testing laboratories across India.

10. Jalyukta Abhiyan is an ambitious program of Chief Minister Devendra Fadnavis that was launched in March 2015. It aims to make 5000 villages free of water scarcity every year and make Maharashtra a drought-free state by 2019. It involves active participation of the peoples from the villages. Under the programme, rainwater will be harvested within the village boundaries, which may help in increasing ground water levels. It will also encourage micro-irrigation systems encouraged for proficient use of water. It is not part of PM Krishi Sanchayee Yojana of Union Govt.

11. The Second Green Revolution is envisaged to start immediately in eastern India including Jharkhand, Bihar, eastern Uttar Pradesh, West Bengal, Odisha and Assam which missed the first GR. The emphasis of SGR is to individual farmer based farming making it would be an inclusive and progressive.

12. Indian agriculture is characterized by small land holdings.

13 and 14. The agricultural crop year in India is from July to June. The Indian cropping season is classified into two main seasons-(i) Kharif and (ii) Rabi based on the monsoon. The kharif cropping season is from July –October during the south-west monsoon and the Rabi cropping season is from October-March (winter). The crops grown between March and June are summer crops. Pakistan and Bangladesh are two other countries that are using the term ‘kharif’ and ‘rabi’ to describe about their cropping patterns. The terms ‘kharif’ and ‘rabi’ originate from Arabic language where Kharif means autumn and Rabi means spring.

The kharif crops include rice, maize, sorghum, pearl millet/bajra, finger millet/ragi (cereals), arhar (pulses), soyabean, groundnut (oilseeds), cotton etc. The rabi crops include wheat, barley, oats (cereals), chickpea/gram (pulses), linseed, mustard (oilseeds) etc.

On the India sub-continent, the crops grown on irrigated lands which do not have to wait for monsoon, in the short duration between Rabi and Kharif crop season, mainly from March to June, are called Zaid crops (also written as Zayad crops). These crops are grown mainly in the summer season during a period called the "Zayad crop season." They require warm dry weather for major growth period and longer day length for flowering. The main produce is seasonal fruits and vegetables.

20. The provisions contained in in the Model APMC Act, 2003 developed by Ministry of Agriculture are as under. 

1.    Direct sale of farm produce to contract farming sponsors

2.    Setting up “Special markets” for “specified agricultural commodities”, mostly perishables

3.    Permitting private persons, farmers and consumers to establish new markets for agricultural produce in any area

4.     Requires a single levy of market fee on the sale of notified agricultural commodities in any market area

5.    Replaces licensing with registrations of market functionaries which would allow them to operate in one or more different market areas;

6.    Establishment of consumers’ and farmers’ markets to facilitate direct sale of agricultural produce to consumers; and

7.    Creation of marketing infrastructure from the revenue earned by the APMC

As stated above, the primary objective of this Act was to allow farmers to sell their produce directly to the consumers or contract farming sponsors.  This was model Act for consumption and action on the part of the states. 

21. Presently, markets in agricultural products are regulated under the Agricultural Produce Market Committee (APMC) Act enacted by State Governments. There are about 2477 principal regulated markets based on geography (the APMCs) and 4843 sub-market yards regulated

by the respective APMCs in India. This Act notifies agricultural commodities produced in the region such as cereals, pulses, edible oilseed, fruits and vegetables and even chicken, goat, sheep, sugar, fish etc., and provides that first sale in these commodities can be conducted only under the aegis of the APMC through the commission agents licensed by the APMCs set up under the Act.

28. Historically, there have been three modes of escape from under-development: geology, geography, and “jeans” (code for low-skilled manufacturing).

1. Using Geology route for bringing the country from the clutches of poverty is exploiting the natural resources and selling them in the international market. Example: West Asia, Botswana and Chile, and further back in time Australia and Canada, exploited their natural resources endowed by geology to improve their standards of living.

2. Some countries such as Barbados, Mauritius, and others in the Caribbean have exploited their geography by developing tourism to achieve high rates of growth.

3. Jeans means using low skilled manufacturing to take the country out of poverty net.  In the early stages of their success, East Asian countries (China, Thailand, Indonesia, Malaysia etc) relied on relatively low-skilled manufacturing, typically textiles and clothing, to motor economic growth and subsequently they diversified into more sophisticated manufacturing but “jeans” offered the vehicle for prosperity early on.

Hence, all the pairs are wrongly matched.

[Additional information: No country has escaped from underdevelopment using relatively skill-intensive activities as the launching pad for sustained growth as India seems to be attempting. Put differently, India seems to have defied its “natural” comparative advantage, which probably lay in the “jeans” mode of escape because of its abundant unskilled and low-skilled labor. The Indian experience, still a work-in-progress, raises the question of whether structural transformation necessarily requires manufacturing to be the engine of growth. But before we compare manufacturing with alternative sectors in terms of their potential for structural transformation, it is worth elaborating on the desirable attributes of such sectors.]

30. The manufacturing units are categorized as registered units and unregistered units in India. The ‘registered units’ are those units registered under Sections 2m (i) and 2m (ii) of the Factories Act, 1948, or under the Bidi and Cigar Workers (Condition of Employment) Act, 1966, i.e. those employing 10 or more workers and using power and 20 or more workers but not using power. Within the manufacturing sector, registered units dominate over the unregistered units in the share of GDP.

31. In Indian Economy, the agriculture and un-registered manufacturing are very low productive sectors and they are un-capable of offering transformational changes in Indian              Economy. The Registered manufacturing and service sectors are considered high productive sectors of Indian Economy which can really transform the economy and make the country to travel in high growth trajectory. But, the problem, they require skilled manpower. “Make in India” will not be able to achieve great things unless the man power is skilled and use the skill in high productivity sectors like Services and registered manufacturing. The service sectors require high skilled people and it has no much scope for employing the un-skilled labour.   

34. All the statements are wrong. According to the National Transport Development Policy Committee [NTDPC], the share of freight traffic in India for railways for the fiscal 2011-12 is around 33%, when compared to 57% freight traffic done by road sector. It is further estimated that the freight traffic of railways would be diluted to 25% by 2020. It has been on a declining trend for quite some years due to poor capacity addition and related factors. The share of railways in freight traffic in other countries is Russia [65%], China [51%], Canada [66] and USA [44%]. [Page 93 of Economic Survey, Volume-I] China invests eleven times as much in per-capita terms and underinvestment in the Indian Railways is also indicated by congestion, strained capacity, poor services, and weak financial health.

35. An efficient rail freight network can help industry to transport raw materials at lower costs  and also with associated lower greenhouse gas emissions, comparatively better energy efficiency, and reduced congestion. As compared to road, railways consume 75 to 90 per cent less energy for freight and 5 to 21 per cent less energy for passenger traffic and, typically, the unit cost of rail transport for freight was lower vis-à-vis road transport by about ` 2 per net tonne-kilometer (NTKM) and for passenger by ` 1.6 per passenger-kilometre (PKM) (in the base year

2000)

37. Green Energy Corridor’ project:

The Government plans to launch a Rs.43,000-crore ‘Green Energy Corridor’ project to facilitate the flow of renewable energy into the national grid. The project will be implemented with the assistance of Germany who has promised to provide developmental and technical assistance of €1 billion for the project. The government has taken lessons from the massive power grid failure that hit the North, East and North-East regions of the country on July 30-31 in 2012 which called for attention to strengthen the electricity distribution network in the country.

        The whole project has been divided into two parts: Inter State: To be developed by State utilities Intra State: To be developed by Power Grid Corporation of India (PGCIL) Germany, who has expertise in making smart grids that integrate renewable energy into national grid will be assisting India in this project. The planned transmission system would be made dynamic to handle the variations leading to an integrated grid across the nation. It would overcome the Voltage Fluctuations. The conventional grids face difficulty in absorbing renewable electricity because of its varying voltage and supply. 

39. In India, MSP is the minimum support price announced for 23 agricultural commodities on the basis of recommendations of Commission for Agricultural Costs and Prices [CACP], generally before the crops are sown. In other words, this MSP is a minimum guaranteed price for the produce made by the farmer in India. The Procurement Price is a price at which the Food Corporation of India purchases from the farmers which is generally more than the MSP, unless the farm produce is spoiled due to rains and for some other reasons. The issue price is price at which the food grains or other items made available to public for consumptions under PDS or TPDS. On an average, about 15-16 million tonnes of food grains are issued by the FCI to the States at a uniform Central Issue Price (CIP) which is much less than the economic cost incurred by the Central Government by way of procurement, storage, transport and distribution. The difference between the economic cost and the CIP, called the consumer subsidy, is borne by the Central Government through its annual non-Plan budget. Most of the states pay bonus to the farmers per unit of farm produce over and above the MSP, for example bonus on sugar cane in UP and bonus for raagi given by Karnataka state. Hence, statement 3 only is correct and the first two statements are wrong.

40. A centrally sponsored scheme of MIDH has been launched for the holistic development of horticulture in the country during XII plan. The scheme which is implemented from 2014-15, integrates the ongoing schemes of National Horticulture Mission, Horticulture Mission for North East and Himalayan states, National Bamboo Mission, National Horticultural Board, Coconut Development Board and Central Institute of Horticulture, Nagaland.

Main objectives of the Mission are:

a) Promote holistic growth of horticulture sector, including bamboo and coconut through area based regionally differentiated strategies, which includes research, technology promotion, extension, post-harvest management, processing and marketing, in consonance with comparative advantage of each State/region and its diverse agro-climatic features;

 b) Encourage aggregation of farmers into farmer groups like FIGs/FPOs and FPCs to bring economy of scale and scope.

c) Enhance horticulture production, augment farmers, income and strengthen nutritional security;

 d) Improve productivity by way of quality germplasm, planting material and water use efficiency through Micro Irrigation.

e) Support skill development and create employment generation opportunities for rural youth in horticulture and post-harvest management, especially in the cold chain sector

41 and 42. A commodity market facilitates trading in various commodities. It may be a spot or a derivatives market. In spot market, commodities are bought and sold for immediate delivery, whereas in derivatives market, various financial instruments based on commodities are traded. These financial instruments such as 'futures' are traded in exchanges.

A commodity futures contract is an agreement between two parties to buy or sell the commodity at a future date at today's future price. Futures contracts differ from forward contracts in the sense that they are standardized and exchange traded. In other words, the parties to the contracts do not decide the terms of futures contracts; but they merely accept terms standardized by the Exchange.

There are 24 commodity exchanges in India. There are three national level commodity exchanges to trade in all permitted commodities futures in India, permitted to be set up with the approval of the Forward Markets Commission [FMC].  

They are se are:

1.  National Commodity & Derivative Exchange of India [NCDEX]: This exchange was originally promoted by ICICI Bank, National Stock Exchange (NSE), National Bank for Agriculture and Rural Development (NABARD) and Life Insurance Corporation of India (LIC). Subsequently other institutional shareholders have been added on. NCDEX is popular for trading in agricultural commodities.

2. Multi Commodity Exchange of India [MCX]: This exchange was originally promoted by Financial Technologies Limited, a software company in the capital markets space. Subsequently other institutional shareholders have been added on. MCX is popular for trading in metals and energy contracts.

3. National Multi Commodity Exchange of India [NCDEX]: This exchange was originally promoted by Kailash Gupta, an Ahmedabad based trader, and Central Warehousing Corporation (CWC). Subsequently other institutional shareholders have been added on. NMCE is popular for trading in spices and plantation crops, especially from Kerala, a southern state of India.

In terms of market share, MCX is today the largest commodity futures exchange in India, with a market share of close to 70%. NCDEX follows with a market share of around 25%, leaving the balance 5% for NMCE. 

47. Ans is “c”. Yellow revolution pertains to Oil seed and not to the pulses.

Black Revolution - Petroleum Production: 1970
Blue Revolution - Fish Production: 1960 Father of Blue revolution Prof: Hiralal Chaudhuri.
Brown Revolution - Leather/non-conventional/Cocoa production
Golden Fiber Revolution - Jute Production
Golden Revolution - Fruits/Overall Horticulture development/Honey Production
Green Revolution - Food grains: Father of Green Revolution M.S. Swaminadhan.
Grey Revolution - Fertilizer : 1964
Pink Revolution - Onion production/Pharmaceutical/Prawn production
Red Revolution - Meat & Tomato Production
Round Revolution - Potato
Silver Fiber Revolution - Cotton
Silver Revolution - Egg/Poultry Production
White Revolution (In India: Operation Flood) - Milk/Dairy production : 1970 Father of White revolution Dr. Verghese Kurien

Yellow Revolution - Oil Seeds production: Father of Yellow Revolution Sam Pit Roda
Evergreen Revolution - Overall development of Agriculture.

51. Both the statements are correct. The GOI has removed the last remaining 20 items from the original list of over 800 items reserved for exclusive production by the MSME sector, thus bringing to an end a policy regime being followed since the 1960s to promote and facilitate the small sector, considered a big employment generator. The de-reservation is being done “to encourage greater investment, incorporate better technologies, standard and branch building and enhance competition in Indian and global markets for these products. With this, there are no reserved products for MSME sector in India now. [The 20 items include pickles & chutneys, mustard oil (except solvent extracted), groundnut oil (except solvent extracted), wooden fixtures, exercise books and registers, wax candles, laundry soap, glass bangles, steel almirah, rolling shutters, steel chairs and tables, padlocks, stainless steel and aluminium utensils.]

53 and 54. The oil and gas industry is usually divided into two major sectors: upstream and downstream.

Definition of Upstream companies:

The upstream stage of the production process involves searching for and extracting raw materials. In the petroleum industry, locating underground/exploration or underwater oil and gas reserves characterizes the upstream process. Additionally, the upstream process in this industry involves bringing oil and gas to the surface.

Examples. Oil and Natural Gas Corporation of India [ONGC], Indian Oil Corporation [IOC], Reliance and Gujarat State Petroleum Corporation Ltd (GSPC)

[Gujarat State Petroleum Corporation Ltd (GSPC) is an oil and gas exploration company in Gujarat, India. It is India's only State Government-owned oil and Gas Company with the Government of Gujarat holding approximately 95% equity stake. GSPC was incorporated in 1979 as a petrochemical company.]

Definition of Downstream companies:

The downstream stage in the production process involves processing the materials collected during the upstream stage into a finished product. The downstream stage further includes the actual sale of that product to other businesses, governments or private individuals. The type of end user will vary depending on the finished product. Regardless of the industry involved, the downstream process has direct contact with customers through the finished product. In the oil and gas industry, the downstream process consists of converting crude oil into other products/refining and then selling those products to customers. Thus, oil refineries represent structures that operate within the downstream process. However, any kind of plant that processes raw materials may qualify as operating within the downstream stage of production.

Examples: Hindustan Petroleum Corporation Limited [HPCL], Bharat Petroleum Corporation Limited [BPCL] and Indian Oil Corporation [IOL]

[Integrated company: A company that combines both upstream and downstream processes is an integrated company, for example, Reliance Industries and Gas Authority of India Limited [GAIL]. GAIL (India) Limited is the largest state-owned natural gas processing and distribution company in India. It has following business segments: Natural Gas, Liquid Hydrocarbon, Liquefied Petroleum gas Transmission, Petrochemical, City Gas Distribution, Exploration and Production, GAILTEL and Electricity Generation. GAIL has been conferred with the Maharatna status on 1 Feb 2013, by the Government of India.]

55. GAIL has been conferred with the Maharatna status on 1 Feb 2013, by the Government of India. With this, there are total 7 Central Public Sector Enterprises having accorded such status. They are 1. Bharat Heavy Electricals Limited, 2. Coal India Limited, 3. GAIL (India) Limited, 4. Indian Oil Corporation Limited, 5. NTPC Limited, 6. Oil & Natural Gas Corporation Limited and 7. Steel Authority of India Limited. BPCL and HPCL are not accorded Maharatna status. [See the criteria for according Maharatna, Navaratna and Miniratna category-I and II status]

56. The Grid interactive power generated cumulatively under various renewable heads as on 31.3.2015 is 35776 MW or 3.5 GW. They are Wind power [23444], Small Hydro power [4055], bagasse co-generation [3008], Solar Power [3743] and waste to power [115]. [Ministry of New and Renewable Energy]

58. Major suggestions of Ramesh Chand committee are

1.     While calculating the cost of production, two villages should be selected in place of one village from each block

2.     Head of a family engaged in farming should be valued at skilled-wage rates

3.     The interest on working capital should be estimated for whole, not half, of the period of a crop season

4.     The land rental values should be based on actual rates prevailing in the sample villages

5.     Interest and depreciation on fixed capital be projected by raising them at the rate of inflation in construction material

6.     The role of CACP be expanded and it should be renamed as the 'Commission on Agricultural Costs, Prices and Policies'. CACP, based on data collected in the comprehensive scheme to begin with, should put out information on farm incomes for different crop complexes and specific categories of farmers, and make recommendations related to farm incomes and remunerative prices.

60. The objective of the Mega Food Parks Scheme is to provide excellent infrastructure facilities for food processing industries along the value chain from the farm to the market. The scheme was originally launched as the 2008 Food Parks Scheme (FPS). The objective of this scheme was to raise the processing of perishables in the country from the existing 6% to 20% and increase value addition from 20% to 35%. Further, its objective was to increase the share of India in the global food trade from 1.5% to 3% by the year 2015. It will include Creation of infrastructure near the farm, transportation, logistics and centralized processing centers. The main feature of the scheme is a cluster based approach. The scheme will be demand driven; pre-marketed and would facilitate food processing units to meet environmental, safety and social standards. The expected outcome is increased realization for farmers, creation of high quality rural processing infrastructure, reduction in wastage, capacity building of the producers and processors and creation of an efficient supply chain along with significant direct and indirect employment generation.

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