Friday, 3 July 2015

CSP 2015 Indian Economy Key Test 4 dt. 15.1.2015

CSP 2015 Indian Economy Key Test 4 dt. 15.1.2015
1.
a
21.
a
41.
c
61.
d
81
a
2.
d
22.
a
42.
c
62.
b
82
a
3.
d
23.
b
43.
b
63.
a
83
b
4.
d
24.
c
44.
b
64.
c
84
c
5.
c
25.
b
45.
d
65.
c
85
a
6.
a
26.
c
46.
a
66.
a
86
a
7.
c
27.
d
47.
c
67.
a
87
c
8.
c
28.
b
48.
a
68.
a
88
a
9.
d
29.
d
49.
a
69.
a
89
b
10.
c
30.
d
50.
c
70.
b
90
d
11.
d
31.
b
51.
b
71
b
91
d
12.
a
32.
b
52.
b
72
d
92
b
13.
a
33.
c
53.
a
73
d
93
a
14.
b
34.
b
54.
c
74
d
94
d
15.
c
35.
c
55.
d
75
c
95
c
16.
b
36.
d
56.
a
76
a
96
c
17.
b
37.
d
57.
c
77
a
97
d
18.
a
38.
c
58.
a
78
a
98
d
19.
a
39.
b
59.
c
79
a
99
a
20.
d
40.
a
60.
c
80
b
100
c








101
d
                                              
Explanation:
01. GDP is monetized value of all the goods and services produced by a domestic country in a year. Usually, GDP is expressed as a comparison to the previous quarter or year. For example, if the year-to-year GDP is up 7%, this is thought to mean that the economy has grown by 7% over the last year.
GDP at factor cost [GDP (FC)] means GDP at market prices [GDP (MP)] minus indirect taxes plus subsidies. If the subsidies are more, the difference between the GDP (FC) & GDP (MP) would also be more. Let us take an example. Let us assume, the GDP at MP of India for FY 2013-14 @ 1000. If the indirect taxes are Rs.100 and subsidies are Rs.40. Then the GDP at FC is 1000-100 plus 40, equal to 940. Hence, the GDP at MP always more than GDP at FC.
The GDP is always calculated based on a particular base year to standardize the value of the good and services taking the inflation into consideration and therefore the GDP based on base year calculations always be more than the GDP (FC), but less than the GDP at MP. Hence the option “a” is correct.   

05. The target of FD is generally fixed as a percentage to the GDP. It is 4.1 for the FY 2004-15 and GOI is desired to bring it down to 3% in two years from now. If the mode of estimation of income is changed from GDP at FC to GDP at MP, the total volume of GDP would go up and consequentially, the amount of FD also in quantitative term will increase, though the percentage remain the same. Hence, correct option is “c” that the FD target fixed would go up in quantitative terms.

10. All the three points are the proposed benefits by implementation of GST in India. The GDP of the country is expected to grow by 2% by implementation of the GST. Hence the correct option is “C”.

12. The rates for both Central and states GST will be fixed by the “GST Council” whose members would be state Finance/Revenue Ministers. Its chairman would be the Union Minister for Finance. The GST council fixes the rates including the floor or base rate with bands within which the states have to operate. Hence, statements 1 and 2 are only correct.
13 and 19. Direct tax collections touched Rs 6,95,988/-  crore [Corporate tax 4.28 lakh crores and Personal Income tax of Rs.2.58 crores] during 2014-15 despite difficulties on the economic front, marginally falling short of the target of Rs.7, 05, 000/- crores. 
Indirect taxes- customs duty, Excise duty and Service Tax yielded Rs 5.46 lakh crore during fiscal 2014-15. The quantum wise taxes in India in ascending order are UED, Service Tax, Income Tax and Corporate Tax.

18. The difference between total revenue and total expenditure of the government is termed as fiscal deficit, FD. It is an indication of the total borrowings needed by the government. While calculating the total revenue, borrowings are not included. A mismatch in the expected revenue and expenditure can result in Revenue Deficit [RD]. It arises when the government’s actual net receipts is lower than the projected receipts. On the contrary, if the actual receipts are higher than expected one, it is termed as revenue surplus. The Effective Revenue Deficit is derived by subtracting the value of grants given for creation of capital assets from RD. Hence, the ERD always be less than RD. [ERD=RD minus value of grants given for creation of capital assets]

21. Tax buoyancy is an indicator to measure efficiency & responsiveness of revenue mobilization in response to growth in the Gross domestic product or National income. A tax is said to be buoyant if the tax revenues increase more than proportionately in response to a rise in national income or output.

25, 26 and 27. The money received by the GOI is categorized as Revenue receipts and Capital receipts.

Revenue Receipts:

Government receipts which neither (i) create liabilities nor (ii) reduce assets are called revenue receipts. Revenue receipts of the government are divided into two groups, namely, (1) tax revenue and (2) non-tax revenue. Tax revenue consists of proceeds of taxes and other duties levied by the Union government such as income tax, corporate tax, excise duty, customs duty, service tax, etc. Income from sources other than taxes is called non-tax revenue. It arises on account of administrative function of the government. These are incomes which the government gets in the form of interest, dividend, profit, fees, fines and external grants
Components or sources of revenue receipts: 

1. Tax Revenue:

Tax revenue comes from two sources, direct and indirect.

 Direct Taxes:
The Taxes whose burden falls directly on the Tax payers/persons are called “Direct Taxes”. Person may a natural person (human beings), non-natural persons like Hindu Undivided Family (HUF), a Partnership Firm, a company etc.
They are Corporate tax [CT], Personal Income Tax [IT], Securities transactions tax, [STT] etc., Income-tax is a tax on the net profit earned in a year in any business or rental income or salary etc. The rate of tax varies for Individuals [you know that tax slabs applicable to individual tax payers and HUF only], firms and companies.
Indirect Taxes:
The taxes in which the burden is passed on to a third party are called “Indirect Taxes”. They are Excise duty, customs duty/import duty, Service Tax, VAT etc. (Value Added Tax (VAT), was earlier known as sales or commercial tax). These taxes are not directly paid by person/s, hence name “indirect taxes”. The rate of tax is common to tax payers but rate of tax varies on the basis of products such as soaps, food items, life saving medicines etc.
Excise duty: It is paid on the production of goods in the factories. When goods are removed from the factory, this tax needs to be paid. 
Eg:  soaps, match boxes, computers, washing machines etc.
Customs duty/import duty:
It is paid on import of goods into the country from outside India. This is to be paid at the time of import.  
Eg:  costly cars, diamonds, petroleum products, gold etc.
Sales Tax: 
It is paid on sale of goods in the market. The levy of sales tax now VAT is in the State List and therefore it is levied by the state governments.  If you buy soap in the market, the price of soap includes an element of indirect tax which the seller/ shop person should pay to the state government.
Value Added Tax:
Value added tax or VAT is an indirect tax, which is imposed on goods and services at each stage of production, starting from raw materials to final product. VAT is levied on the value additions at different stages of production. VAT is widely applied in the European countries. However, now a number of countries across the globe have adopted this tax system, including India w.e.f. 1 April 2005

2.  Non-tax revenue:

Income from sources other than taxes is called non-tax revenue. It arises on account of administrative function of the government. These are incomes which the government gets in the form of interest, dividend, profit, fees, fines and external grants as explained below.
 (i) Interest: It is an important source of Government non-tax revenue. Government receives interest on loans given by it to state governments. Union territory governments, local governments, private enterprises and the people
(ii) Profits and Dividends: The profits earned by the public enterprises which like private enterprises produce and sell goods and services. For instance Nationalized Banks, Industrial Finance Corporation of India, LIC, STC, HMT, MMTC, BHEL, etc. provide profits. Government also gets dividends on investments made by it in various PSBs and PSUs.
(iii) Fees and Fines: Government gets income, though nominal, in the form of different types of fees charged by it, e.g., tuition fees in schools, OPD card fees in hospitals, land registration fees, passport fees, court fees, driving licence fees, import fees, etc. Similarly, government gets income by way of fines and penalties imposed by it on various types of offences committed by the law-breakers.
Forfeitures of basic surety or bond (imposed by courts for non-compliance with orders) and escheat (lapsing of property to state for want of legal heir) are other sources of non-tax revenue. This type of revenue is called administrative revenue since it arises on account of government administrative functions.
(iv) Special Assessment:
When government undertakes development activities like construction of roads, provision of drainage, street lighting in a particular area, the value of nearby property or rental value of houses goes up in the vicinity. Clearly the additional income and profit which the owners of the landed property get is not the result of efforts on their part.
Special assessment is, therefore, like a special tax that government levies in proportion to the benefit accruing to property owners to defray the cost of development. It is a payment made once-for-all by the owners of properties for increase in the value of their properties resulting from development activities of the government.
(v) External grants-in-aid: Government receives financial help from foreign governments and international organizations in the form of grants, donations, gifts and contribution.

Capital Receipts:

Government receipts which either (i) create liabilities (e.g. borrowing) or (ii) reduce assets (e.g. disinvestment) are called capital receipts. Thus when govt. raises funds either by incurring a liability or by disposing off its assets, it is called a capital receipt.

 (i) Recovery of loans and advances:

Loans offered by government to others are government assets because it owns money that it lends. We know that Central Government grants loans to (i) States, Union territories, (ii) public sector enterprises, other parties and (Hi) foreign governments. Recovery of such loans is treated as capital receipts because it causes reduction in assets of the government.

(ii) Disinvestment:

Government raises funds from disinvestment also. Disinvestment means selling whole or a part of the shares (i.e., equity) of selected public sector enterprises (like Indian Oil Corporation, Steel Authority of India) held by government to private sector. As a result, government assets are reduced. Sometimes, disinvestment is so termed as privatization because it involves transfer of ownership of public sector enterprises to private enterprises.

(iii) Borrowing (domestic and external):

Funds raised by government from borrowing are treated as capital receipts because they create liability of returning loans. These funds are borrowed from (i) open market, (ii) Reserve Bank of India, iii) foreign governments and international organisations. Government resorts to borrowing when its expenditure exceeds its revenue, i.e., when there is fiscal deficit.

(iv) Small savings:

Government receipts also include small savings like Post Office deposits. Public Provident Fund deposits, National Saving Certificate deposits, Kisan Vikas Patras, etc.
 Debt is creating and Non-debt creating capital receipts:
The capital receipts are of two types, (i) Debt creating capital receipts and (ii) Non- debt creating capital receipts Examples of debt creating receipts are—Net borrowing by government at home, loans received from foreign governments, borrowing from RBI. Examples of non-debt capital receipts are—Recovery of loans, proceeds from sale of public enterprises (i.e., disinvestment), etc. These do not give rise to debt.
          In view of the above detailed discussion,  receipts mentioned in the statements, 1 to 3 are revenue in nature and the PPF proceeds used by GOI is a loan and therefore it is a capital receipt in Q.No.25. All are capital receipts in Q.No. 26.  In Q.No. 27, except interest earned/ received by GOI on its investment, all others are capital receipts. 

28. Broadening of tax base is adding the new tax payers in to tax net whereas deepening is making the tax payer to pay more tax by doing investigations and unearthing the extra income.

32. India’s share in global exports and imports has improved from 0.8 and 1% respectively in 2004-05 to 1.7 and 2.5% respectively in 2013-14. Share of Indian Exports to Europe and America have declined over the years from 23.6% and 20.1% respectively in 2004-05 to 18.6 and 17.2% respectively in 2013-14. Conversely, shares of India’s exports to Asia and Africa have increased from 47.9 and 6.7% respectively in 2004-05 to 49.4 and 9.9% in 2013-14 respectively. Hence, statement 1 is not correct.  

33. Fiscal policy is the means by which a government adjusts its spending levels and tax rates to monitor and influence a nation's economy. It is the sister strategy to Monetary Policy. The latter is implemented by RBI which influences a nation's money supply. Measures to control inflation are part of both Monetary Policy and Fiscal policy and hence answer is “c”. [See at the end note given on the “Measures to control Inflation”]

34. Before looking at Current Account Deficit, let us look what current account is?
In the current account, goods, services, income and current transfers are recorded, related to particular period. It is part of the Balance of Payments [The balance of payments (BOP) is the place where countries record their monetary transactions with the rest of the world]
1. Goods - These are movable and physical in nature and in order for a transaction to be recorded under "goods", a change of ownership from/to a resident (of the local country) to/from a non-resident (in a foreign country) has to take place. Movable goods include general merchandise, goods used for processing other goods, and non-monetary gold. An export is marked as a credit (money coming in) and an import is noted as a debit (money going out).
2. Services - These transactions result from an intangible action such as transportation, business services, tourism, royalties or licensing. If money is being paid for a service it is recorded like an import (a debit), and if money is received it is recorded like an export (credit).
3. Income - Income is money going in (credit) or out (debit) of a country from salaries, portfolio investments (in the form of dividends, for example), direct investments or any other type of investment. Together, goods, services and income provide an economy with fuel to function. This means that items under these categories are actual resources that are transferred to and from a country for economic production.
4. Current Transfers - Current transfers are unilateral transfers with nothing received in return. These include workers' remittances, donations, aids and grants, official assistance and pensions. Due to their nature, current transfers are not considered real resources that affect economic production.
          The “Current Account Deficit”, CAD, is a measurement of a country's trade in which the value of goods and services it imports exceeds the value of goods and services it exports. The overseas investment made by Indians is part of capital account of BOP and not part of current account. The CAD will go down if exports exceed imports and the CAD will go up if exports of goods and services are exceeded by imports. Remittances by NRIs is a part of Current Account. Hence, the export and import of merchandise and services and remittances play a role in determining the CAD, but not the overseas investment made by Indias which is part of Capital account. 

36. Proceeds of disinvestment represent capital receipts, but not revenue receipts. Similarly, loans recovered reduce the capital. Hence, it is a capital receipt. The non-tax revenue receipts are interest income earned by GOI on the loans given by it and dividends received from their stake or investment in the PSUs and other organizations.   

38. All the three measures mentioned in the query play a positive role of reducing subsidies and all of them help in reducing FD.

39. Pumping money into the economy by decreasing taxation and increasing government spending is also known as "pump priming." With more money in the economy and fewer taxes to pay, consumer demand for goods and services increases. This, in turn, rekindles businesses and turns the cycle around from stagnant to active and reduces the overall unemployment levels. This is purely fiscal policy announced in the budget or goes with the decisions of the cabinet or Government. There is no role for the Central Bank in this area and it is not a part of Monetary Policy which controls money supply in the Economy by various quantitative and qualitative measures.
40. An economic theory from the 18th century which is strongly opposed to any government intervention in business affairs. In simple words, it means a “free market economy” where prices of the goods and services are determined by supply and demand of the said good and services. Sometimes referred to as "let it be economics." People who support a laissez faire system are against minimum wages, duties, and any other trade restrictions. Laissez faire is French for "leave alone."
43. Binding tariffs and applying them equally to all trading partners (most-favoured-nation treatment, or MFN) are key to the smooth flow of trade in goods. The WTO agreements uphold the principles, but they also allow exceptions — in some circumstances. Three of these issues are:
1. Actions taken against dumping (selling at an unfairly low price),
2. Subsidies and special “countervailing” duties to offset the subsidies
3. Emergency measures to limit imports temporarily, designed to “safeguard” domestic industries.
Hence, option “b” is correct.

44. The first ever multilateral agreement on any issue under WTO was made  in 9th Ministerial Conference of WTO at Bali in December, 2013 and it was Trade Facilitation Agreement [TFA]  related to Greater transparency and simplification of customs procedures, Use of electronic payments and risk management techniques and Faster clearances at Ports. No agreement was reached on subsidies related to procurement and holding of public stocks for food security at Bali. However, the developing countries, led by India, have linked TFA with the Agreement on Agriculture, where no progress has been made so far. It made developed countries to accept to extend the Peace clause related to agricultural subsidies, related to public stocking meant for food security in developing countries was extended indefinitely or till the permanent solution is found for the issue. Hence, the correct option is “b”.

45. The FDI and investments brought into stock market by FPI is non-debt creating as the investments are brought by foreigners to make profits in India and therefore these instruments are non-debt creators. On the other hand External Commercial Borrowings (ECBs), SDRs and NRI deposits with RBI [different from NRI remittances] are nothing but loans obtained by GOI and they are debt-creating where India has to service these debts. [SDRs or paper gold which can be availed to the extent allowed to a country based on its capital contribution in the time of need, but it is in the nature of a loan and has to be repaid to IMF] 

51. During the year 2014-15 [up to January, 2015], the total coal produced in India is 485 million tons and the coal produced by CIL during the same period was 389 million tons. The balance 96 million tons is produced by other concerns in India. Coal demand is estimated at 685 to 700 million tons during 2014-15 in India and the demand is going to jump in the next few years, driven by Prime Minister Narendra Modi's promise to supply power to all. The balance requirement of about 200 million tons is imported. Hence the correct option is “b”.  

52. Carbon tax is levied on the carbon content of the carbon containing fuels such as coal, petroleum and natural gas. These fuels unlike, non-combustion energy sources such as wind, Solar, hydropower and nuclear, convert hydrocarbons into Co2. This type of tax would affect, directly or indirectly, the  low income groups disproportionately. The regressive impact of carbon taxes could be addressed by using tax revenues to favour low income groups. From the economic perspective, it is a type of pigovian tax as it help to address the problem of emitters of GHG not facing full(social) costs of their actions. India has doubled carbon tax/green energy cess on coal from Rs.50/- to Rs.100/- per ton of coal production in 2014.

53. The recent slump in oil prices has not reduced the cost of the fossil fuels in India. The basic reason is that GOI has increased excise duty on petrol and diesel and therefore almost reduced the under recoveries from the upstream oil and gas companies like ONGC and IOC to zero.

58. The Organization of the Petroleum Exporting Countries (OPEC) was founded in Baghdad, Iraq, with the signing of an agreement in September 1960 by five countries namely Islamic Republic of Iran, Iraq, Kuwait, Saudi Arabia and Venezuela. They were to become the Founder Members of the Organization. There are 12 members at present in the organization. They are Algeria, Angola, Ecuador, Iran, Iraq, Kuwait, Libya, Nigeria, Qatar, Saudi Arabia, United Arab Emirates and Venezuela. [The members are represented from the three continents. The Asian members are Iran, Iraq, Kuwait, Qatar, Saudi Arabia and United Arab Emirates [6]; from Africa, the members are Algeria, Angola, Libya and Nigeria [4] and the South American countries are Ecuador and Venezuela [2].]
In accordance with its Statute, the mission of the Organization of the Petroleum Exporting Countries (OPEC) is to coordinate and unify the petroleum policies of its Member Countries and ensure the stabilization of oil markets in order to secure an efficient, economic and regular supply of petroleum to consumers, a steady income to producers and a fair return on capital for those investing in the petroleum industry.
USA has emerged as the largest producer of oil and natural gas  during the year 2014 and it is not a member of OPEC. The United States has overtaken Saudi Arabia as the world's biggest oil producer in 2014 while India has recorded the highest growth in energy consumption among major economies. The US produced 15.9% more oil in 2014 at 11.6 million barrels of oil per day to topple Saudi Arabia's 11.5 million bpd production, according to BP Plc's Statistical Review of World Energy released on Wednesday.   Russia with 10.8 million bpd oil production was placed third. The US surpassed Russia as the world's largest producer of oil and gas, producing 1,250.4 million tons of oil and oil equivalent natural gas in 2014. This compared with Russia's 1,062 million tons of oil equivalent.  While India's oil production declined 1.3% at 895,000 bpd, consumption rose 3% to 3.8 million bpd.   Though India is heavily dependent on imports to meet its oil needs, it is self-sufficient in refining capacity, housing a total capacity of 4.3 million bpd, fourth largest in the world behind the US (17.79 million bpd), China (14.09 million bpd) and Russia (6.3 million bpd) 

 Hence the answer is “a”. 

59. The Trans-Pacific Partnership (TPP) is a proposed regional regulatory and investment treaty. As of 2014, twelve countries throughout the Asia Pacific region have participated in negotiations on the TPP: Australia, Brunei, Canada, Chile, Japan, Malaysia, Mexico, New Zealand, Peru, Singapore, the USA and Vietnam. The proposed agreement began in 2005 as the Trans-Pacific Strategic Economic Partnership Agreement (TPSEP or P4). Participating countries set the goal of wrapping up negotiations in 2012, but contentious issues such as agriculture, intellectual property, and services and investments have caused negotiations to continue into the present, with the last round meeting in Ottawa from 3–12 July 2014. Implementation of the TPP is one of the primary goals of the trade agenda of the Obama administration in the United States of America. [If it comes into reality, it may benefit Vietnam to compete with India in apparel exports and may affect India’s prospects in this area. You know that in FTA, there would not be customs duties against the Vietnam’s apparel whereas the same would be levied on Indian goods and thereby making them less competitive in the international market] 
Regional Comprehensive Economic Partnership (RCEP) is a proposed Free Trade Agreement (FTA) between the ten member states of the Association of South East Asian Nations (ASEAN)[ Brunei, Myanmar, Cambodia, Indonesia, Laos, Malaysia, the Philippines, Singapore, Thailand and Vietnam]  and the six states with which ASEAN has existing FTAs, Australia, China, India, Japan, South Korea and New Zealand. RCEP negotiations were formally launched in November 2012 at the ASEAN Summit in Cambodia
 India and China are not a part of the negotiations going on to start TPP, but both are part of RCEP.

61. Mercosur [Literal meaning Southern Common Market) is a sub-regional bloc comprising Argentina, Brazil, Paraguay, Uruguay and Venezuela. Its associate countries are Chile, Bolivia, Colombia, Ecuador and Peru. Its purpose is to promote free trade and the fluid movement of goods, people, and currency.

62. The Pay Commissions are created once in every 10 years to review of the existing costs, inflation and other impact costs and make suitable revisions to the salary structure of central government employees.. The Pay Commission is created by the resolution of the cabinet and notified by the Government. Hence, they are neither constitutional nor statutory [Created by an act of Parliament].

The Seventh Pay Commission:

On 24 February 2014, the Government of India issued a Gazette notification announcing the formation of the Seventh Central Pay Commission with Justice A.K.Mathur as the Chairman, Vivek Rae – Member (full time), Dr. Rathin Roy – Member (part time), and Meena Agarwal – Secretary. The Seventh Pay Commission had to submit its recommendations within 18 months (expected by August 2015) and the same is to be implemented from 1 January 2016.
The ‘Terms of Reference’ was to examine, review, evolve and recommend changes regarding the emoluments structure comprising pay, allowances, facilities and benefits – in cash or kind. The Commission has been asked to examine the existing scheme of bonus and its bearing on productivity and performance, examine the incentive scheme to reward performance, productivity and integrity, and examine the pension scheme along with other retirement benefits that will impact:
ü  Central Government employees – industrial and non-industrial
ü  Personnel belonging to All India Services
ü  Personnel of the Union Territories
ü  Officers and employees of the Indian Audit and Accounts Department
ü  Members of regulatory bodies (excluding RBI) set up under Acts of Parliament
ü  Officers and employees of the Supreme Court
ü  All employees of Defence Forces
The Commission is mandated to make recommendations based on current:
ü  Pay structure, associated benefits and existing retirement benefits.
ü  Economic conditions prevailing in the country and fiscal prudence.
ü  Adequacy of resources to meet various welfare measures and developmental expenditures.
ü  Impact on State Government finances as most states adopt recommendations made by the Commission with some revisions as per their priority.
ü  Best global practices and adopt the same.

68. Loans offered by government to others are government assets because it owns money that it lends. We know that Central Government grants loans to (i) States, Union territories, (ii) public sector enterprises, other parties and foreign governments. This is accounted as capital expenditure. Recovery of such loans is treated as capital receipts because it causes reduction in assets of the government. Whereas part of the defence expenditure is always capital and other part is revenue expenditure. Hence, all the statements are true.

75. FCI comes under the Ministry of Consumer Affairs, Food and Public Distribution. This Ministry also implements Private Entrepreneurs Guarantee (PEG) Scheme for creating additional go-downs for storing the food grains under PPP model; Declaration of MSP [to 25 products or commodities] comes under the Ministry of agriculture and co-operation. The Urea policy and other fertilizer policies and their subsidization fall under the purview of Ministry of Chemicals and Fertilizers.

76. The committee recommended that the amounts to be transferred into the account of female member, not into the account of male head of the family. 

78. DEFINITION of 'Baltic Dry Index - BDI' is a  shipping and trade index created by the London-based Baltic Exchange that measures changes in the cost to transport raw materials such as metals, grains and fossil fuels by sea. The Baltic Exchange directly contacts shipping brokers to assess price levels for a given route, product to transport and time to delivery (speed). 

The Baltic Dry Index is a composite of three sub-indexes that measure different sizes of dry bulk carriers (merchant ships) - Capesize, Supramax and Panamax. Multiple geographic routes are evaluated for each index to give depth to the index's composite measurement. It is also known as the "Dry Bulk Index".

80. Department of AYUSH, Ministry of Health and Family Welfare, Government of India [Now it is a separate Ministry, see the explanation to the question, 90] has launched National AYUSH Mission (NAM) during 12th Plan for implementing through States/UTs. The basic objective of NAM is to promote AYUSH medical systems through cost effective AYUSH services, strengthening of educational systems, facilitate the enforcement of quality control of Ayurveda, Siddha and Unani & Homoeopathy (ASU &H) drugs and sustainable availability of ASU & H raw materials. It envisages flexibility of implementation of the programmes which will lead to substantial participation of the State Governments/UT.

81. The AIIB is scheduled to lend for infrastructure projects in Asian region only, but not in Asia-pacific region. China’s shareholding is 30.34 per cent and it has retained 26.06 per cent of the voting rights with veto powers for certain key decisions. India is its second largest shareholder with a stake of 8.52 per cent and voting share of 7.5 per cent. AIIB is regarded by some as a rival for the IMF, World Bank and Asian Development Bank which have worldwide operations and are mostly dominated by developed countries like the United States.
Unlike, the IMF, World Bank and ADB, the voting shares are based on the size of each member country’s economy and not contribution to the Bank’s authorized capital. UK is the only G7 countries joined this bank. The others are Australia, Bangladesh, Brazil, Cambodia, Finland, France, Germany, Italy, Jordan, Nepal, Netherlands, New Zealand, Norway, Pakistan, Portugal, Republic of Korea [South Korea], Russia, Saudi Arabia, Singapore, Spain, Sri Lanka, Sweden, Switzerland, and the U.K.

82. In 2013, Bangladesh has agreed to allow India to use its Ashuganj port for transporting food grains to the Northeast. India transported 10,000 tonnes of rice for Tripura which would come from Haldia port to Ashuganj port in Brahmanbaria district in Bangladesh and then the grains would reach Agartala by trucks. Hence, answer is “a”.

85. The Programme for International Student Assessment (PISA) is a project of the OECD designed to provide policy-oriented international indicators of the skills and knowledge of 15-year-old students. Three literacy domains are being assessed in PISA: Reading, Mathematics and Science . In each cycle, two-thirds of testing time will be devoted to a major literacy domain. The overall standard of education in India is well below the global standards. Indian students fared badly in PISA.

90. The Ministry of AYUSH is formed on 9th November, 2014 for providing more health care to the public, by elevating the Dept. of AYUSH under the Ministry of Health and Family Welfare*.  Skill India Mission is implemented by newly created Ministry of Skill Development and Entrepreneurship. The prestigious Swatchh Bharat Abhiyan is implemented by two Ministries,   the urban component of the mission will be implemented by the Ministry of Urban Development, and the rural component by the Ministry of Drinking Water and Sanitation
*[Going into the history, the Department of Indian Medicine and Homeopathy (IS & H) was created in 1995 and renamed as Department of Ayurveda, Yoga, Naturopathy, Unani, Siddha and Homeopathy (AYUSH) in 2003 with a view to providing focused attention to development of Education and Research in Ayurveda, Naturopathy, Unani, Siddha and Homeopathy systems.]                                  
91. Consequent to the decision of the United Nation on 11th December, 2014 with the support of 177 nations, International Yoga Day is being celebrated on 21st June, 2015. Ministry of Ayurveda, Yoga & Naturopathy,Unani, Siddha and Homoeopathy (AYUSH), Government of India is the Nodal Agency to coordinate various activities for the celebration of International Yoga Day. International Yoga Day, June 21, was declared as the International Day of Yoga by the UN General Assembly on December 11, 2014 and first International Day of Yoga has been observed on 21st June, 2015.
 Yoga is a physical, mental and spiritual practice or discipline that originated in India. The Indian PM, Narendra Modi, in his UN Address suggested the date to be June 21 as the International Day of Yoga as it is the longest day of the year (Summer solstice) in the Northern Hemisphere and has special significance in many parts of the world.  From the perspective of yoga, the Summer Solstice marks the transition to Dakshinayana. The first full moon after Summer Solstice is known as Guru Poornima. Lord Shiva, the first yoga practitioner (Adi Yogi) is said to have begun imparting the knowledge of yoga to the rest of mankind on this day and became the first guru (Adi Guru). Dakshinayana is also considered a time when there is natural support for those pursuing spiritual practices [In CSP 2015, Yoga is important from History and culture point of view also. Try to know different types of Yoga and their proponents]
92. UDAAN is a Special Industry Initiative for Jammu & Kashmir in the nature of partnership between the corporates of India and Ministry of Home Affairs and implemented by National Skill Development Corporation. The programme aims to provide skills training and enhance the employability of unemployed youth of J&K. The Scheme covers graduates, post graduates and three year engineering diploma holders. It has two objectives:
(i) To provide an exposure to the unemployed graduates to the best of Corporate India;
(ii) To provide Corporate India, an exposure to the rich talent pool available in the State.
The Scheme aims to cover 40,000 youth of J&K over a period of five years and Rs. 750 crore has been earmarked for implementation of the scheme over a period of five years to cover other incidental expenses such as travel cost, boarding and lodging, stipend and travel and medical insurance cost for the trainees and administration cost. Further corporates are eligible for partial reimbursement of training expense incurred for the candidates who have been offered jobs.

93. The goal - to cut in half, by 2015, the proportion of people without sustainable access to safe water - has been achieved globally, but the same target for sanitation has been missed by almost 700 million people. Under WASH campaign, Mundla village in Sehore district of Madhya Pradesh has made history by getting the status of OFD [Open Defecation Free] village. All the houses have toilets and most of them use gobar gas for cooking. Mawlynnong in Meghalaya bagged the Asia’s cleanliest village award due to collective efforts and innovation.

95. VKY has been implemented on a pilot project basis in 10 states which have scheduled areas in them and not in all states as stated in the option “c”.

96. By 2020, India would be the youngest nation in the world with the projected average age of 29. This projected average age in 2020 has been already surpassed in states like Kerala [33], Tamil Nadu [31.3], Himachal Pradesh [30.4], Andhra Pradesh [29.3] and West Bengal [29.1]. At present the youngest states are Meghalaya, Arunachal Pradesh, Bihar and Uttar Pradesh. Hence option 1 is only correct and other 2 statements are wrong.  

99. Those subsidies which benefit the rich more than the poor are called as regressive subsidies. Most of the price subsidies are regressive in nature. For instance, in the case of electricity, the bottom quintile of households consumed just 10 per cent of the total subsidy, the top quintile consumed 37 per cent of the total power subsidies of Rs 32,300 crore. Similarly, the poorest 50 per cent households consume only 25 per cent of the LPG subsidy while 51 per cent of subsidized kerosene is consumed by non-poor households and almost 15 per cent of subsidized kerosene is actually consumed by the relatively well-off, i.e., the richest 40 per cent. The total LPG subsidy stood at Rs 23,746 crore, according to government estimates The Economic survey suggested that JAM trinity- Jan Dhan Yojana, Aadhaar number and Mobile numbers required to be used for effective transfer to the intended beneficiaries. All the subsidies mentioned in the query are regressive in nature.

100. Out of Trans-Pacific Partnership, Trans-Atlantic Trade and Investment Partnership and
Regional Comprehensive Economic Partnership [RCEP], India is seriously engaged in RCEP only. In other two proposed agreements, India’s membership is not considered as India is not washed by the waters of the Pacific Ocean and Atlantic Ocean. Similarly China has been kept of the TPP and TTIP and in fact RCEP is china led regional FTA to counter the TPP.
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33. A note on measures to contain inflation:
As we know Inflation is caused by increase in the number of currency without increasing the amount of stuff. In simple terms, Inflation is MORE money chasing the SAME amount of stuff.
The different methods used to control inflation are known as anti-inflationary measures. These measures attempt mainly at reducing aggregate demand for goods and services on the basic assumption that inflationary rise in prices is due to an excess of demand over a given supply of goods and services. We know that inflation is caused by the failure of aggregate supply to equal the increase in aggregate demand. Inflation can, therefore, be controlled by increasing the supplies and reducing money incomes in order to control aggregate demand.
The various methods to control inflation are given below however the most common ones are Monetary and Fiscal Policies:
1. Monetary Policy
Monetary policy is the policy of the central bank of the country, which is the supreme monetary and banking authority in a country. The central bank may use such methods as the bank rate, open market operations, the reserve ratio and selective controls in order to control the credit creation operation of commercial banks and thus restrict the amounts of bank deposits in the country. This is known as tight money policy. Monetary policy to control inflation is based on the assumption that a rise in prices is due to a larger demand for goods and services, which is the direct result of expansion of bank credit. To the extent this is true, the central bank’s policy will be successful.
Monetary policy may not be effective in controlling inflation, if inflation is due to cost-push factors. Monetary policy can only be helpful in controlling inflation due to demand-pull factors.
The most extreme monetary measure is the issue of new currency in place of the old currency. Under this system, one new note is exchanged for a number of notes of the old currency. The value of bank deposits is also fixed accordingly. Such a measure is adopted when there is an excessive issue of notes and there is hyperinflation in the country. It is very effective measure. But is in-equitable for its hurts the small depositors the most.
Let us see how increasing the rate can help control inflation
A higher interest rate should also lead to higher exchange rate, which helps to reduce inflationary pressure by
§  Making imports cheaper.
§  Reducing demand for exports and
§  Increasing incentive for exporters to cut costs.
2. Fiscal Policy
It is the policy of a government with regard to taxation, expenditure and public borrowing. It has a very important influence on business and economic activity. Taxes determine the size or the volume of disposable income in the hands of the public. The proper tax policy to control inflation will avoid tax cuts, introduce new taxes and raise the rates of existing taxes. The purpose being to reduce the volume of purchasing power in the hands of the public and thus reduces their demand. A precisely similar effect will be achieved if voluntary or compulsory savings are increased. Savings will reduce current demand for goods and thus reduce the inflationary rise in prices.
As an anti-inflationary measure, government expenditure should be reduced. This indicates that demand for goods and services will be further reduced. This policy of increasing public revenue through taxation and decreasing public expenditure is known as surplus budgeting. However, there is one important difficulty is this policy. It may be easy to increase revenue in times of inflation when people have more money income, but difficult to reduce public expenditure.
During war times as well as during a period of development, it is absolutely impossible to reduce the planned expenditure. If the government has already taken up a scheme or a group of schemes, it is ruinous to give them up in the middle. Therefore, public expenditure cannot be used as an anti-inflationary measure. Lastly, public debt, i.e., the debt of the government may be managed in such a way that the supply of money in the country may be controlled.
The government should avoid paying back any of its previous loans during inflation so as to prevent an increase in the circulation of money. Moreover, if the government manages to get a surplus budget, it should be used to cancel public debt held by the central bank. The result will be anti-inflationary since money taken from the public and commercial banks is being cancelled out and is removed from circulation. But the problem is how to get a budget surplus, which is extremely difficult.
3. Price Control and Rationing
This is the most important and effective method available during war and other critical times particularly because both monetary and fiscal policies are more or less useless during this period. Price control implies the establishment to legal upper limits beyond which prices of particular goods should not rise. The purpose of rationing, on the other hand, is to distribute the goods in short supply in an equitable manner among all people, irrespective of their wealth and social status. Price control and rationing generally go together. The chief objection behind use of this method to fight inflation is that they restrict the freedom of the consumers and thus limit their welfare. Besides, its success depends on administrative efficiency, which in many underdeveloped countries is very low.
4. Other Methods
Another important anti-inflationary device is to increase the supply of goods through either increased production or imports. Production may be increased by shifting factors of production from the production of less inflation sensitive goods, which are in comparative abundance to the production of those goods which are in short supply and which are inflation-sensitive. Moreover, shortage of goods internally may be relieved through imports of inflation sensitive goods, either on credit or in exchange for export of luxury goods and other non-essentials.
A word may be added about the measures to control cost-push inflation. It is suggested that wages, salaries and profit margins should be controlled and fixed through a system of income freeze. Business units may particularly welcome wage freeze. However, wage freeze is not so easy or just, unless trade unions agree to the proposal and there is also freezing of prices. At the same time, the Government should not raise the rates of commodity taxes. Thus, it is difficult to control cost push inflation through controlling wages and other incomes. The best method is to bring a rapid increase in production, which will automatically check prices and wages also.
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