10th October 2020, Static Quiz on Indian Economy

Solution: b)
Justification: The real interest rate is the nominal interest rate – inflation rate. For example, if base rates is 5.5% and the CPI inflation rate is 3.4%. Then the real interest rates is said to be 2.1%. A higher real interest rate is good for savers and bad for borrowers. Note, even if nominal interest rates were high e.g. 11%, savers would see a decline in their real value of money if inflation was 12%. This is why the real interest rate is important. Real interest rates can be negative if inflation is higher than nominal interest rates.

Solution: a)
Justification: Statement 1 and 2: It is an end-to-end solution for processing payments, tracking, monitoring, accounting, reconciliation and reporting. It provides the scheme managers a unified platform for tracking releases and monitoring their last mile utilization. Mandatory use of Public Finance Management System (PFMS) will help monitor the flow of funds to beneficiaries of different government welfare schemes. The actual status of utilization of funds by the multiple implementing agencies of the Central and the State Governments can be known.
Statement 3: The Department of Expenditure is administering the PFMS.
It has tremendous potential to improve programme/financial management, reduce the float in the financial systems by enabling ‘just in time’ releases and also the Government borrowings with direct impact on interest costs to the Government.

Solution: c)
Justification: Statement 1: Sanitation, education, drinking water, health etc. come under the category of public goods and services. When provided privately, they often become unaffordable for the poor masses. When they are provided at a lower price, people can afford them and the money that is spare can be spent in the market.
Statement 2: During recession, often the demand for labour goes down and the first ones to be laid off from the job are the contract workers who are usually at the lower rung of the society. If public goods like health, education, drinking water etc. are provided at low cost or free of cost, it gives them a safety net even as they are unemployed. The money saved from spending on these public goods can be used for private consumption

Solution: a)
Justification: Statement 1: It is a RBI conceptualized system driven by National Payments Corporation of India (NPCI). It is a one-stop payment platform for all bills providing an interoperable and accessible “Anytime Anywhere” bill payment service to all customers across India with certainty, reliability and safety of transactions.
Statement 2: BBPS transaction can be initiated through multiple payment channels like Internet, Internet Banking, Mobile, Mobile-Banking, POS (Point of Sale terminal), Mobile Wallets, MPOS (Mobile Point of Sale terminal), Kiosk, ATM, Bank Branch, Agents and Business Correspondents.

Solution: c)
Justification: It aims at simplifying Warehouse Registration Rules, digitizing entire process of registration, monitoring and surveillance as well as creation and management of NWRs in electronic form through two repositories. NWRs are documents issued by warehouses to depositors against commodities deposited in warehouses for which warehouse is bailee. NWRs can be traded, sold, swapped and used as collateral to support borrowing or loans from banks. These receipts were made negotiable under Warehouse (Development and Regulation) Act, 2007 and are regulated by Warehousing Development and Regulatory Authority (WDRA). e-NWR will have no chances of any tempering, mutilation, fudging, loss or damage and also no possibility of any multiple financing. e-NWR will also help to save expenditure in logistics as stocks could be traded through multiple buyers without physical movement and can be even split for partial transfer or withdrawal.

Solution: d)
Justification: Statement 1: It is a trust established by the Department of Commerce, Ministry of Commerce and Industry. Statement 2: IBEF’s primary objective is to promote and create international awareness of the Made in India label in markets overseas and to facilitate dissemination of knowledge of Indian products and services. Towards this objective, IBEF works closely with stakeholders across government and industry Statement 3: This is to promote Indian exports as well as push Make in India campaign. Statement 4: IBEF has undertaken focused branding activities for sectors namely engineering, pharma, plantations (tea, coffee and spices), services, textiles and leather.

Solution: d)
Justification: Statement 1: The summit organized annually since 2010, is the preeminent annual entrepreneurship gathering that convenes over one thousand emerging entrepreneurs, investors, and supporters from around the world. This year marks the first GES held in South Asia, and the event underscores the broad and enduring partnership with India.
Statement 2: The summit of 2017 will focus on four key industry sectors: Energy and Infrastructure, Healthcare and Life Sciences, Financial Technology and Digital Economy, and Media and Entertainment.
 The US and India will co-host the Global Entrepreneurship Summit (GES) in Hyderabad, India.
 GES 2017 will create an environment that empowers innovators, particularly women, to take their ideas to the next level

Solution: a)
Justification: CPC: The US State Department has unveiled its list of countries designated as the worst offenders against religious liberty. These countries are labelled as CPC. A country is labelled as a CPC, by USA, after it engages in “systemic, ongoing, [and] egregious” violations of religious liberty. This declaration is in accordance with the International Religious Freedom Act of 1998. The list includes Burma, China, Eritrea, Iran, North Korea, Sudan, Saudi Arabia, Tajikistan, Turkmenistan, and Uzbekistan. The governments that have been designated as CPCs are subject to ‘Presidential Actions’, such as sanctions, which may include economic or political measures directed against a government to encourage it to improve the state of religious freedom in its country.

Solution: d)
Justification: It was adopted by a Conference of the Food and Agriculture Organization (FAO) in 2001. The Treaty aims at: recognizing the enormous contribution of farmers to the diversity of crops that feed the world; establishing a global system to provide farmers, plant breeders and scientists with access to plant genetic materials; ensuring that recipients share benefits they derive from the use of these genetic materials with the countries where they have been originated.
Statement 1: The Treaty recognizes the enormous contribution farmers have made to the ongoing development of the world’s wealth of plant genetic resources. It calls for protecting the traditional knowledge of these farmers, increasing their participation in national decision-making processes and ensuring that they share in the benefits from the use of these resources
Statement 2 and 3: The Treaty facilitates access to the genetic materials of the 64 crops in the Multilateral System for research, breeding and training for food and agriculture. Those who access the materials must be from the Treaty’s ratifying nations and they must agree to use the materials totally for research, breeding and training for food and agriculture. The Treaty prevents the recipients of genetic resources from claiming intellectual property rights over those resources in the form in which they received them, and ensures that access to genetic resources already protected by international property rights is consistent with international and national laws.

Solution: d)
Justification: S1: Protecting a title, slogan, or other short word phrase, generally requires trademark, not Patent. Both require registration, else trademark or patent cannot be claimed over the product (phrase, logo etc.). A patent for an invention is the grant of a property right to the inventor issued by the government. It is the right to exclude others from making, using, offering for sale, or selling. Thus, it is more restrictive than both copyrights and trademark.
S2: In trademark the same good can be made. However, it does not restrict others from innovating in the patented subject-matter, as also in the case of copyrights (where the subject matter can be written upon by others too).