Static Quiz 09 May 2024 (Economy)

CACP, which recommends MSP, is again not a statutory body and it is just an office attached to Ministry of Agriculture. CACP just recommends MSP but the decision on fixing and even not fixing and its implementation (i.e. procurement at MSP) lies with the Govt.

Before the sowing, during each Rabi and Kharif crop season, Government of India, Ministry of Agriculture and Farmers’ Welfare announces the Minimum Support Prices (MSP) for procurement based on the recommendation of the Commission for Agricultural Costs and Prices (CACP) under Ministry of Agriculture and Farmers’ Welfare and upon approval of the Cabinet Committee on Economic Affairs (CCEA).

World Bank
Objective:
• Reconstruction of war affected countries (achieved)
• To promote development to raise standard of living in developing countries (& LDC also)
• To eliminate poverty
• To promote investment in developing countries by providing finance, technical assistance (related to development programmes, environment and infrastructure) and guarantees

Ramesh Chand Committee: Niti Aayog Member(Agriculture), “Sugarcane and Sugar Industry” recommended linking of Sugarcane prices to sugar rate to maintain the financial state and stability of the industry and to clear the arrears of the sugarcane farmers.

A Development Finance Institution (DFI) is an organization which is either owned by the government or by charitable institutions to finance infrastructure projects that are of national importance but may or may not meet commercial return standards.

Some Important Development Finance Institutions in India
1. IFCI: Industrial Finance Corporation of India was established in 1948. It is India’s first Development Finance Institution.
2. ICICI: Industrial Credit and Investment Corporation of India Limited was established in the year 1955 by an initiative of the World Bank and was the first DFI in the private sector. ICICI Limited established its subsidiary company ICICI Bank Limited in 1944 and in 2002, ICICI Limited was merged into ICICI Bank Limited, making it the first universal bank of India.
3. IDBI: Industrial Development Bank of India was set up in 1964 under RBI and was granted autonomy in 1976. The bank is responsible for ensuring adequate flow of credit to various sectors and was converted into a universal bank in 2003.
4. IRCI: Industrial Reconstruction Corporation of India was set up in 1971 to revive weak units and provide financial & technical assistance.
5. SIDBI: Small Industries Development Bank of India was established in 1989 as a subsidiary of IDBI and was granted autonomy in 1998.
6. EXIM Bank: Export-Import Bank was established in January 1982 to provide technical assistance and loan to exports.
7. NABARD: National Bank for Agriculture and Rural Development was established in July 1982 on the recommendation of the Shivraman Committee and functions as a refinancing institution.
8. NHB: National Housing Bank was established in 1988 to finance housing projects.

Rupee denominated debt in India can be issued by the government as well as the private sector. Hence statement 1 is correct.

Rupee denominated debt refers to that part of India‘s total external debt that is denominated in India‘s domestic currency, the Rupee.

In contrast to foreign currency denominated external debt, in case of rupee-denominated debt,
the currency risk (the risk arising from appreciation or depreciation of the nominal exchange rate) is borne by the creditor and not by the borrower. Hence statement 2 is incorrect.