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Indian Economy

621 questions asked in UPSC Prelims.

2026 · Q25Indian EconomyInfrastructure & Industrymoderate

Consider the following statements with reference to the Sagarmala Programme of the Government of India : I. The Sagarmala Programme seeks to achieve port-led economic growth through cost-effective and sustainable coastal infrastructure. II. The success of the Sagarmala Programme is reflected in significant growth in coastal and inland waterway shipping, along with improved global port rankings. III. Sagarmala 2.0 aims to position India as a global maritime innovation hub aligned with Atmanirbhar Bharat and Viksit Bharat 2047 visions. Which of the following relationships among the above statements is/are correct ? 1. Statement II validates the effectiveness of the strategies envisioned in statement I. 2. Statement III extends the objectives of statement I by embedding them into a future-oriented innovation framework. 3. Statement I contradicts statement III by focusing only on traditional infrastructure instead of modern innovation. Select the answer using the code given below :

  1. (a)1 only
  2. (b)1 and 2
  3. (c)2 and 3
  4. (d)3 only
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Official answer(b) 1 and 2

2026 · Q34Indian EconomyInfrastructure & Industrymoderate

In what way(s) does the Vizhinjam International Seaport represent a structural shift in India's maritime trade and logistics policy ? 1. By functioning exclusively as a domestic cargo hub to reduce reliance on coastal shipping and eliminate the need for foreign collaborations. 2. By focusing primarily on passenger cruise tourism and heritage shipping to increase Kerala's profile as a maritime heritage destination. 3. By leveraging its natural deep draft and strategic location to reduce dependence on foreign trans-shipment ports, enhance revenue retention, and reposition India in regional maritime trade. Select the answer using the code given below :

  1. (a)1 only
  2. (b)1 and 2
  3. (c)2 and 3
  4. (d)3 only
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Official answer(d) 3 only

2026 · Q38Indian EconomyAgriculture & Rural Developmentmoderate

Which among the following is/are the objective(s) of the Rainfed Area Development (RAD) initiative under the National Mission for Sustainable Agriculture (NMSA) ? 1. Encouraging monoculture in rainfed areas 2. Increasing rice cultivation in irrigated regions 3. Enhancing productivity and minimising climatic risks through Integrated Farming Systems (IFS) Select the answer using the code given below :

  1. (a)1 only
  2. (b)1 and 2
  3. (c)2 and 3
  4. (d)3 only
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Official answer(d) 3 only

2026 · Q39Indian EconomyInternational Trade & WTOdifficult

Which of the following is/are the most significant implication(s) of obtaining Oeko-Tex certification for Eri Silk in the global textile industry ? 1. It allows Indian exporters to compete in high-end markets that prioritise chemical-free products. 2. It confirms that Eri Silk meets international safety, environmental, and quality standards, enabling its entry into premium eco-conscious markets. Select the answer using the code given below :

  1. (a)1 only
  2. (b)2 only
  3. (c)Both 1 and 2
  4. (d)Neither 1 nor 2
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Official answer(c) Both 1 and 2

2026 · Q48Indian EconomyInfrastructure & Industrymoderate

Which one of the following pairs of semiconductor plants in India and their locations is not correctly matched ?

  1. (a)CG Power and Industrial Solutions Pvt. Ltd. in partnership with Renesas Electronics and STARS Microelectronics : Gujarat
  2. (b)Tata Semiconductor Assembly and Test Pvt. Ltd. : Assam
  3. (c)HCL-Foxconn Joint Venture India Chip Ltd. : Madhya Pradesh
  4. (d)SicSem Pvt. Ltd. : Odisha
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Official answer(c) HCL-Foxconn Joint Venture India Chip Ltd. : Madhya Pradesh

2026 · Q54Indian EconomyDigital Payments & Financial Inclusionmoderate

Which one of the following best describes the key objective of India’s ‘Open Network for Digital Commerce’ (ONDC) initiative ?

  1. (a)To allow government control over all digital commerce transactions
  2. (b)To replace private e-commerce players
  3. (c)To break the dominance of large e-commerce platforms by enabling interoperability across networks
  4. (d)To mandate UPI-based payments for all online transactions
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Official answer(c) To break the dominance of large e-commerce platforms by enabling interoperability across networks

2026 · Q55Indian EconomyDigital Payments & Financial Inclusionmoderate

Which one of the following statements about Unified Payments Interface (UPI) and Central Bank Digital Currency (Digital Rupee) is not correct ?

  1. (a)UPI is a real-time payment system but Digital Rupee is akin to sovereign paper currency.
  2. (b)In case of UPI, settlement for end users happens instantly as the money gets immediately debited or credited but in case of Digital Rupee, there is no settlement as the wallet balance gets transferred to another wallet.
  3. (c)UPI transactions are recorded by banks and reflected in bank statements but in case of Digital Rupee, no data is captured in bank statements as transactions are from one wallet to another.
  4. (d)In both the cases (UPI and Digital Rupee), the liability lies with the users and their respective banks.
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Official answer(d) In both the cases (UPI and Digital Rupee), the liability lies with the users and their respective banks.

2026 · Q56Indian EconomyFinancial Markets & Capital Marketsdifficult

Which of the following statements about Real-World Assets (RWA) Tokenization are correct ? 1. Tokenization is the process of turning real world assets into digital tokens using blockchain technology. 2. Tokenization of real world assets offers 24 × 7 access, promoting financial inclusion. 3. Tokenization of real world assets will allow the access to high growth investment opportunities for individuals in India. Select the answer using the code given below :

  1. (a)1, 2 and 3
  2. (b)2 and 3 only
  3. (c)1 and 2 only
  4. (d)1 and 3 only
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Official answer(a) 1, 2 and 3

2026 · Q58Indian EconomyBanking & Financial Sectordifficult

Which of the following statements about M1xchange’s role in Micro, Small & Medium Enterprises (MSMEs) financing is/are correct ? 1. M1xchange provides collateral based loans to MSMEs. 2. M1xchange facilitates discounting of invoices and Bills of Exchange for MSMEs. 3. M1xchange functions as a credit rating agency for MSMEs. Select the answer using the code given below :

  1. (a)1, 2 and 3
  2. (b)2 only
  3. (c)2 and 3 only
  4. (d)1 only
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Official answer(b) 2 only

2026 · Q59Indian EconomyFiscal Policy & Budgetmoderate

Which one of the following best describes the ‘Crowding Out Effect’ in the context of fiscal policy ?

  1. (a)A situation where private investment increases due to increased Government spending
  2. (b)A situation where Government borrowing leads to higher interest rates, which reduces private investment
  3. (c)A situation where an increase in taxes leads to increased private sector investment
  4. (d)A situation where Government spending has no impact on aggregate demand
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Official answer(b) A situation where Government borrowing leads to higher interest rates, which reduces private investment

2026 · Q60Indian EconomyInfrastructure & Industrymoderate

Which of the following statements about Rare Earth Elements (REEs) and Critical Minerals is/are correct ? 1. Modern technological innovations including Artificial Intelligence, robotics and space exploration extensively utilise Rare Earth Elements (REEs). 2. China has the highest share in mining of REEs followed by India. 3. The Government of India launched the National Critical Mineral Mission (NCMM) in 2025 to establish a robust framework for self-reliance in the critical mineral sector. 4. Rare Earth Elements are a set of 13 metallic elements. Select the answer using the code given below :

  1. (a)1 and 3 only
  2. (b)3 only
  3. (c)1, 3 and 4
  4. (d)1, 2 and 4
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Official answer(a) 1 and 3 only

2026 · Q61Indian EconomyBanking & Financial Sectordifficult

Which of the following statements about insurance in aviation sector is/are correct ? 1. ‘Aviation Hull Insurance’ covers the physical aircraft, including the body, engine, and on-board equipment. 2. Under the Montreal Convention, adopted in 1999 by over 130 countries, including India, airlines are strictly liable to pay compensation to the family/nominee of every deceased passenger without requiring the family to prove fault. Select the answer using the code given below :

  1. (a)1 only
  2. (b)2 only
  3. (c)Both 1 and 2
  4. (d)Neither 1 nor 2
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Official answer(c) Both 1 and 2

2026 · Q62Indian EconomyFinancial Markets & Capital Marketsmoderate

Which of the following statements about Crowdfunding is/are correct ? 1. Crowdfunding is solicitation of funds (small amount) from multiple investors through a web-based platform or social networking site for a specific project. 2. Small and Medium Enterprises (SMEs) are able to raise funds at lower cost of capital without undergoing rigorous procedures. Select the answer using the code given below :

  1. (a)1 only
  2. (b)2 only
  3. (c)Both 1 and 2
  4. (d)Neither 1 nor 2
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Official answer(c) Both 1 and 2

2026 · Q63Indian EconomyBanking & Financial Sectormoderate

With reference to different Committees in India, consider the following details : Sl. No. | Committee | Objective | Organization under which it was formed 1. | R.N. Malhotra Committee | Comprehensive reforms of Insurance sector in India | Insurance Regulatory and Development Authority of India 2. | L.C. Gupta Committee | Preparing a roadmap for the introduction of derivatives trading in India | Securities and Exchange Board of India 3. | Urjit R. Patel Committee | Preparing a roadmap for reforming bank lending to the Housing sector | Reserve Bank of India 4. | Y.H. Malegam Committee | Preparing a roadmap for reforms in Microfinance sector in India | Reserve Bank of India In which of the above rows are all the details correctly matched ?

  1. (a)2 only
  2. (b)2 and 3
  3. (c)1, 3 and 4
  4. (d)2 and 4
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Official answer(d) 2 and 4

2026 · Q64Indian EconomyBanking & Financial Sectormoderate

Consider the following statements about the Non-Banking Financial Companies (NBFCs) in India : 1. NBFCs cannot accept demand deposits. 2. All the NBFCs operating in India have to be registered with the RBI. 3. NBFCs form part of the payment and settlement system and can issue cheque drawn on itself. 4. Deposit insurance facility of Deposit Insurance and Credit Guarantee Corporation (DICGC) is not available to the depositors of deposit taking NBFCs. Which of the statements given above is/are correct ?

  1. (a)1 and 4
  2. (b)1, 2 and 3
  3. (c)4 only
  4. (d)2, 3 and 4
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Official answer(a) 1 and 4

2026 · Q65Indian EconomyHuman Development, Poverty & Employment Schemesmoderate

Consider the following statements about Multidimensional Poverty Index (MPI) : 1. MPI is calculated using Alkire-Foster methodology. 2. MPI calculated by NITI Aayog has a total of twelve indicators. 3. Maternal Health and Bank Account are common indicators in the MPI of NITI Aayog and MPI of United Nations Development Programme (UNDP). Which of the statements given above is/are correct ?

  1. (a)1 and 2 only
  2. (b)1, 2 and 3
  3. (c)1 and 3 only
  4. (d)2 only
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Official answer(a) 1 and 2 only

2025 · Q3Indian EconomyGovernment Organizationsmoderate

With reference to the Government of India, consider the following information : Organization | Some of its functions | It works under I. Directorate of Enforcement | Enforcement of the Fugitive Economic Offenders Act, 2018 | Internal Security Division–I, Ministry of Home Affairs II. Directorate of Revenue Intelligence | Enforces the Provisions of the Customs Act, 1962 | Department of Revenue, Ministry of Finance III. Directorate General of Systems and Data Management | Carrying out big data analytics to assist tax officers for better policy and nabbing tax evaders | Department of Revenue, Ministry of Finance In how many of the above rows is the information correctly matched?

  1. (a)Only one
  2. (b)Only two
  3. (c)All the three
  4. (d)None
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Official answer(a) Only one

2025 · Q4Indian EconomyInfrastructure & Industryeasy

Consider the following statements : I. The Reserve Bank of India mandates all the listed companies in India to submit a Business Responsibility and Sustainability Report (BRSR). II. In India, a company submitting a BRSR makes disclosures in the report that are largely non-financial in nature. Which of the statements given above is/are correct?

  1. (a)I only
  2. (b)II only
  3. (c)Both I and II
  4. (d)Neither I nor II
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Official answer(b) II only

2025 · Q5Indian EconomyTaxationmoderate

Consider the following statements : Statement I : In India, income from allied agricultural activities like poultry farming and wool rearing in rural areas is exempted from any tax. Statement II : In India, rural agricultural land is not considered a capital asset under the provisions of the Income-tax Act, 1961. Which one of the following is correct in respect of the above statements?

  1. (a)Both Statement I and Statement II are correct and Statement II explains Statement I
  2. (b)Both Statement I and Statement II are correct but Statement II does not explain Statement I
  3. (c)Statement I is correct but Statement II is not correct
  4. (d)Statement I is not correct but Statement II is correct
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Official answer(d) Statement I is not correct but Statement II is correct

2025 · Q6Indian EconomyInfrastructure & Industrymoderate

Consider the following statements : I. India has joined the Minerals Security Partnership as a member. II. India is a resource-rich country in all the 30 critical minerals that it has identified. III. The Parliament in 2023 has amended the Mines and Minerals (Development and Regulation) Act, 1957 empowering the Central Government to exclusively auction mining lease and composite license for certain critical minerals. Which of the statements given above are correct?

  1. (a)I and II only
  2. (b)II and III only
  3. (c)I and III only
  4. (d)I, II and III
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Official answer(c) I and III only