[Answerkey] UPSC Prelim-2019: Economy is relatively easier than last year, No Budget-Taxation FancySchemes or Apps

1. Observation / Analysis about Economy in Prelims-19
2. Strategy for Prelims-2020: Economy, Schemes, Yearbook
3. Answerkey-2019: Eco-Pillar#1: Banking Finance
4. Answerkey-2019: Eco-Pillar#2: Fiscal Policy & Bodies
5. Answerkey-2019: Eco-Pillar#3: BoP & International Trade
6. Answerkey-2019: Eco-Pillar#4A: Agriculture
7. Answerkey-2019: Eco-Pillar#4: Sectors of Economy
8. Answerkey-2019: Eco-Pillar#4: Labour Rights
9. Answerkey-2019: Eco-Pillar#5: Infrastructure
10. Answerkey-2019: Eco-Pillar#6: HRD

Observation / Analysis about Economy in Prelims-19

• UPSC conducted civil services IAS/IPS preliminary exam on 2nd June 2019.
• Total 28 out of 100 questions in General Studies Paper-1 were devoted to Economy, Yearbook & Schemes.
• Ofcourse, every faculty tries to claim that maximum questions came from his subject.
• So, a Geography faculty may count Agriculture import / export under Economic Geography, Science-Tech teacher may claim Patents Act question came from their domain.
• But in my classification, I club them together under various pillars of Economy.

Economy in Prelim 2018 and Before	Prelim-2019: Continuity and Change
Since 2015, 20+ MCQs devoted to this area	Trend continued.
2017 and 2018: ~41-44% of the Economy Questions were in Easy category.	~50% in Easy category, that means economy section is relatively easier than last year.
2018: Question paper had become further complicated due to debatable questions on GST, Money bill, human capital formation.	Prima facie, no questions appear to be in the debatable category. All questions can be safely verified from the reliable sources, and / or wrong options can be eliminated safely using the basic understanding of the theory.
2018: 7 MCQs from theory, while rest from current and contemporary era.	Same pattern continues: 7 from theory, 2 from current (i.e. 1/1/2018 onwards) and 19 from Contemporary era (i.e. topics in news since 2-3-5-7 years)
2018: Microeconomics asked after a long gap	Nothing from microeconomics.
Application of Guessmaster-giri -2017: 9 MCQs -2018: 3 MCQs	– In 4 MCQs, Guessmaster-giri results in direct answers without studying anything. – In 3 MCQs are Anti-Guessmaster where application of GMrules will lead to wrong answer. So, net ‘gain’ is 4*2-3*0.67= ~6 marks. – Further, in 5 other MCQs, Guessmaster-giri helps elimination of half the options and reach the fabled 50:50 stage. So, UPSC examiner needs to improve the quality of framing options so it doesn’t help such in cheat-codes and hacks.
Unique feature of Prelim-2018’s MCQs is that quite a few statements required “DATA INTERPRETATION (D.I.)” of random Government reports.	Same nonsense continues albeit at a reduced lunatic level, with random question on import export of agriculture commodities.
2017: UPI, 2018: BHIM	Prem for digital payment system continued, this year asked about storage of digital payment data.
Pillar#1: Banking, Finance occupied 6-7 MCQs	Same trend.
Pillar#2: GST, equalization tax, Money bill, FRBM act, related Questions asked in Prelims-2018	Interestingly, ZERO question from Interim Budget 2019 or taxation. Just a question about parliamentary oversight on regulatory bodies.
Pillar#3: From 2016 to 2018 continuously asked one question on WTO	Breakup with WTO. Now asked about AIIB.
Pillar#6: At Least one MCQ on skill development schemes in 2017 and 2018. And some direct indirect questions on schemes / Food security act etc.	Nothing from skill development, no scheme asked. Despite so much ho-hum about PM-KISAN, PM-JAY etc. May be UPSC examiner was also following a ‘Model Code Of Conduct’!
2018: usual question on Human capital formation	Asked about social capital
Trend of asking about Obscure Organizations: 2016- FSSAI labelling guidelines, 2017- QCI, 2018-Again FSSAI.	Continued with entry of new obscure organization: PNGRB
Prelim 2016- Hunger index, Prelim 2017- Gender Gap index. 2018- asked about Rule of law index.	Global Competitiveness Report, Ease of Doing Business Report asked.

Strategy for Prelims-2020: Economy, Schemes, Yearbook

• Which chapters of India Yearbook 2019 (MinI&B) | हिंदी में भी उपलब्ध are important is given in this separate article. At this stage no point of purchasing the 2019’s books. Better wait till 2020’s edition next year. Chapter list will most probably remain the same, so prepare accordingly.
• Unlike Polity, History or Environment, there is no single book covering economy in sufficient exam oriented manner.
• The boundary of economy syllabus is fluid, students mistakenly start doing Ph.D / Chartered Accountant level preparation or chasing petty current affairs and figures.
• So, few years back I started putting economy series on my Youtube Channel com/c/TheMrunalPatel to cover the economy in an exam oriented manner. But, nowadays youtube is littered with too many UPSC channels so advertising revenue gets divided in such proportion that it’s not financially viable.
• So, before Prelim-2019, I had launched Economy full course at Unacademy Plus Live platform, including 400+ pages worth of comprehensive revision handouts. Uniqueness about those handouts is:
  • You don’t have to separately consult other books, NCERTs.
  • All the important schemes, policies, ministries and related yearbook organizations are covered.
  • Latest Budget and Economic Survey is covered.
  • Handouts are in English, but also contain Hindi terminologies to help the vernacular aspirants in the Mains-Exam as well. Saves a lot of time and trouble of going through dictionaries.
• 16 out of 28 Economy related MCQs in Prelims-2019 could be solved directly from my lecture series & its handouts. Screenshot proofs are attached with this answer key. I consider UPSC a sacred exam and don’t even like to brag about how many questions could be solved from my material, but with the entry of so many unscrupulous commercial elements in the online domain, such chest-thumping has became necessary, lest the novice youngsters get hypnotized by those elements and their MBA-walli sales pitches.
• Now, my next LIVE-batch for Prelim-2020 is starting from 21st June, 2019. There will be weekly Live Classes, weekly quiz, updated material, Q&A doubt solution.
• Uniqueness about this Unacademy ‘Plus’ model is that just one subscription fees unlocks access to all full length courses by other faculties / educators– be it Roman Saini’s Essay writing or environment, history, science-tech, polity, geography, current affairs, various modules for Mains and even certain optional subjects. Link for Registration: Click Me, and Use PROMOCODE “mrunal.org” to avail further 10% discount.

What if i don’t want to join your paid course

For some reason you don’t want to join / can’t join above paid course due to monetary issues, then how to approach economy for Prelims-2020? Thugs of Delhi / Khan-Market MukherjeeNagar Gang will never tell you that, unless you join their Paid-course. But, I despise such tactics. So, here is the answer:

1. First, study topicwise answer key for economy of previous years, available for free at mrunal.org/prelims It will give your basic idea on what type of questions are asked and as a result it’ll save you from pursuing Ph.D or Charter-Accountant giri which is not required to pass IAS-prelims.
2. Then, go through my Youtube playlist called ‘BES17’. It covers economy theory as well as budget and Economic survey 2017. So, focus only on theory and the contemporary topics like GST, NPA, BASEL etc.
3. Then update economy current affairs from whichever PDF compilation / magazine you like. Although the problem with these PDF compilations is they excessively focus on trivial data and figures. That’s why I have given the first step- go through previous paper to get an idea what is important and what is not important. You should pursue the 6 pillar approach in current affairs, if you can’t classify a Economy-current topic in any of those 6 pillars then it’s not important for economy portion of exam.
4. Pillar#1 Banking Finance: Every announcement made by RBI is not important. Only those announcement related to core of the monetary policy, financial inclusion, non-performing asset and digital payment are important. People had engaged in so much PHD over Project Shashkt’s Asset reconstruction companies financing mechanism but look how simple question UPSC has asked from that topic. UPSC rarely asks microeconomics or in-depth question from SEBI-Sharemarket, so no need to prepare too much of it. Cutoff is never 200 out of 200 marks.
5. Pillar#2: Budget speech should to be prepared. Sometimes things are asked after a lag of 1 year. For every major scheme you should be aware which department is responsible for implementing it, what is the funding pattern, and what are the salient features / eligibility conditions. + Keep an eye on the other major topics like GST, FRBM, Finance Commission, passing of the budget, highlights of the latest Economic Survey etc.
6. Pillar#3: Basics of Balance of payment and currency exchange rate mechanism should be known. Unnecessarily people were doing so much haay-haay over RBI’s Currency swap but look how basic things UPSC has asked about currency exchange in Prelims-2019. Similarly, for notable international organization – you should be aware of their membership, last summit, important treaties. For international reports, you should be aware of which organisation publishes them how frequently they are published what are the components of given index, who got first rank, what is India’s rank?
7. Pillar#4: Among the sectors of economy- agriculture and its schemes should be given more priority because of the merger with the Forest Service exam. Among the rest of the topics: IPR-Patents, NITI-FYP, MSME-Textile, GDP-Inflation-IIP: Basic theory and current affair should be known. PDF-wallas have to release monthly content, so they’ll keep giving ball by ball commentary about everything under the sun like how IMF/World Bank has raised or lowered India’s growth projection, but it’s not important for exam.
8. Pillar#5: Infrastructure- Simply prepare the notable schemes, laws, organizations and portal/apps for mining, energy, water-sanitation, transport, communication and urban rural infrastructure. In the mains exam (GSM3) there is a topic on public private partnership (PPP), but UPSC is not asking IIM-A investment banker exam questions there. Prepare the basics only from any internet source.
9. Pillar#6: Poverty, Education, HRD. Just prepare the notable schemes, laws, organizations & reports, including SDG. Sufficient material and compilations are available on the internet.
10. For economy, better to read Indian Express instead of theHindu. Because theHindu’s economy section is centered around only two things: 1) We are more intelligent than RBI governor 2) WTO-Bashing.
11. For Mains: Preface of last 3 years’ Yojana Kurukshetra Magazines. (Free PDFs available both in English and vernacular language)
12. For Mains: Introduction- Conclusion of Vol1 of Economic Surveys of last 3 years.

To conclude, Economy is not a rocket science. Economy is a scoring component of General Studies. It’s much easier to master compared to certain other segments of GS. Now let’s solve Prelims-2019 paper:

Answerkey-2019: Eco-Pillar#1: Banking Finance

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(Pre19-SetA) Q64. Which of the following is not included in the assets of a commercial bank in India?
(a) Advances
(b) Deposits
(c) Investments
(d) Money at call and short notice
Difficulty: Easy. This much basic understanding of Money-Banking-Finance is expected from every serious candidate.

ANS: Mrunal’s lecture on Pillar1B: Monetary Policy Part1

• Deposit is a liability of the commercial bank, It has to be returned to the customer. Alternatively,
• NCERT Macroeconomics Class12, page 40: observe the table 3.1: Deposits are plotted on the liability side of a commercial bank’s balance sheet.

Guessmastergiri^TM: Not Applicable.

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(Pre19-SetA) Q90. The money multiplier in an economy increases with which one of the following?
(a) Increase in the cash reserve ratio
(b) Increase in the banking habit of the population
(c) Increase in the statutory liquidity
(d) Increase in the population of the country
Difficulty: Easy. This much basic understanding of Money-Banking-Finance is expected from every serious candidate.

ANS: Mrunal’s lecture on Pillar1B: Monetary Policy Part1

• Money Multiplier directly improves with cut in legal reserve ratios (SLR, CRR: so A and D are wrong)
• Money Multiplier indirectly improves as economy develops, consumption / loan demand increases, banking penetration improves etc.

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(Pre19-SetA) Q72. What was the purpose of the Inter-Creditor Agreement signed by Indian banks and financial institutions recently?
(a) To lessen the Government of India’s perennial burden of fiscal deficit and current account deficit
(b) To support the infrastructure projects of Central and State Governments
(c) To act as independent regulator in case of applications for loans of Rs 50 crore or more
(d) To aim at faster resolution of stressed assets of Rs 50 crore or more which are under consortium lending.
Difficulty: Easy. Basic feature of Project Sashakt asked.

ANS: Mrunal’s lecture on Burning Issues in Banking Sector.

• Project Sashakt by Finance Ministry: It has 5 Pronged approach to resolve the NPA problem in time bound manner for Public Sector Banks. Approach #2: For Mid-sized bad loans 50-500cr: Intercreditor pact. So, D is the correct choice.

Anti-Guessmaster question, because Guessmastergiri^TM Rule#2: Dates, Years & figures are always wrong in statement but if you believe that then you’ll eliminate both C and D, you’ll never arrive at the correct answer!

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(Pre19-SetA) Q73. The Chairman of public sector banks are selected by the
(a) Banks Board Bureau
(b) Reserve Bank of India
(c) Union Ministry of Finance
(d) Management of concerned bank
Difficulty: Easy. Basic feature of BBB asked.

ANS: Mrunal’s lecture on Pillar#1: Burning Issues in Banking Sector Part#2.

• Bank Board Bureau (BBB). Setup in 2016, BBB selects top officials (MD, CEO, Chairman and full-time Directors) for PSBs, LIC and other public sector financial institutions. Actual appointment done by FinMin’s Department of Financial Services. (Just like UPSC selects candidates suitable for IAS but DoPT notifies appointment.) Alternatively,
• India Yearbook 2019 (MinI&B) | हिंदी में भी उपलब्ध ch3 Polity: The Banks Board Bureau was established for conducting the selection for appointment to board level position in public sector banks.

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(Pre19-SetA) Q87. The Reserve Bank of India’s recent directives relating to ‘Storage of Payment System Data’, popularly known as data diktat command the payment system providers that :

1. They shall ensure that entire data relating to payment systems operated by them are stored in a system only in India.
2. They shall ensure that the systems are owned and operated by public sector enterprises.
3. They shall submit the consolidated system audit report to the comptroller and Auditor General of India by the end of the calendar year.

Which of the statements given above is/are correct
(a) 1 only
(b)1 and 2 only
(c) 3 only
(d) 1,2 and 3 only
Difficulty: Easy. Asked from the monetary policy updates.

ANS: Mrunal’s Youtube lecture on RBI’s bi-monthly monetary policy updates: payment system providers are required to store the data in India only. Other features are hyperbole / irrelevant / not required by RBI.
Anti-Guessmaster question, because Guessmastergiri^TM Rule#1: Extreme worded statements are always wrong, then First statement ought to be wrong but if you believe it then you will never arrived at the right answer!

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(Pre19-SetA) Q61. The Service Area Approach was implemented under the purview of
(a) Integrated Rural Development Programme
(b) Lead Bank Scheme
(c) Mahatma Gandhi National Rural Employment Guarantee Scheme
(d) National Skill Development Mission
Difficulty: Tough because a rather unusual question from an obscure topic.
ANS: Random Google book page 106

• Basic function of Lead Bank: Preparation of service area credit plan. Coordination with the efforts of Government, banks and credit agencies.
• Service Area approach is a modification of Lead Bank scheme.

Guessmastergiri^TM: Not Applicable.

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(Pre19-SetA) Q67. Which of the following is issued by registered foreign portfolio investors to overseas investors who want to be part of the Indian stock market without registering themselves directly?
(a) Certificate of Deposit
(b) Commercial Paper
(c) Promissory Note
(d) Participatory Note
Difficulty: Easy.

ANS: Mrunal’s Youtube Lecture on Black Money #1

• Participatory Note (P-Notes): A foreigner wishes to invest in India but does not want to go through the hassles of registering with SEBI, getting PAN card number, opening a DEMAT account etc. So, he will approach a SEBI registered foreign institutional investor (FII) / foreign portfolio investor (FPI) such as Morgan Stanley, Citigroup or Goldman Sachs. He’ll pay them & instruct them to purchase particular shares and bonds and store them in their Demat account. Then FII will give him P-Notes.

Guessmastergiri^TM: Not Applicable.

Answerkey-2019: Eco-Pillar#2: Fiscal Policy & Bodies

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(Pre19-SetA) Q69. In India, which of the following review the independent regulators in sectors like telecommunications, insurance, electricity etc. ?

1. Ad Hoc Committees set up by the Parliament.
2. Parliamentary Department Related Standing Committees
3. Finance Commission
4. Financial Sector Legislative Reforms Commission
5. NITI Aayog

Select the correct answer using the code given below.
(a) 1 and 2
(b) 1 , 3 and 4
(c) 3, 4 and 5
(d) 2 and 5
Difficulty: Medium.
ANS:

• Financial Sector Legislative Reforms Commission was setup for a limited time period under Justice B.N. Srikrishna’s chairmanship. And its mandate did not include reviewing the electricity regulator. #4 is wrong. Similar reason eliminates Finance Commission (#3) which is setup periodically for the tax distribution between Union and States. THus B and C are eliminated.
• NITI Ayog is a think tank and policy advisor for the Government. Yes it reviews development work in the Aspirational districts and SDG implementation across India but reviewing independent regulators is not under its purview. So, #5 is wrong. This eliminates D.
• Thus by elimination, we are left with Answer A: only 1 and 2.

Guessmastergiri^TM: Not Applicable.

Answerkey-2019: Eco-Pillar#3: Balance of payment & International Trade

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(Pre19-SetA) Q37. Among the following, which one of the following is the largest exporter of rice in the world in the last five years?
(a) China
(b) India
(c) Myanmar
(d) Vietnam
Difficulty: Tough. Who prepares this much trend analysis each and every crop!?
ANS: 2019-Jan, Hindu Businessline Or 2018-June IndianExpress

• India has been the world’s top rice exporter since the beginning of this decade. But this boom has benefited only merchant capitalists, not consumers and producers.

Guessmastergiri^TM: Not Applicable.

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(Pre19-SetA) Q84. Among the agricultural commodities imported by India, which one of the following accounts for the highest imports in terms of value in the last five years?
(a) Spices
(b) Fresh fruits
(c) Pulses
(d) Vegetable oils
Difficulty: Medium to Tough. If you had gone through last year’s UPSC Prelim answer key, then you’d know that “quantity of imported edible oils is more than the domestic production of edible oils in the last five years.” So, answer could be 50:50 between either C or D. Because seems unlikely that we are importing spices or fruits in great quantity.
ANS:

• India Yearbook 2019 (MinI&B) | हिंदी में भी उपलब्ध ch.15 on Food: As there is a continuous demand in excess over the domestic supply of edible oils, its import has been resorted to for more than two decades. So, D is most likely to be the answer.
• Let’s crosscheck through data available at PIB-2019

Import in ₹ Cr.	2017	2018
Vegetable Oil	5432.96	5103.64
Pulses	1357.44	976.37
Fruits & vegetables	1329.03	1309.25

• Export data of spices is given but import data is not given, which points out that we are importing either NIL / negligible amount of spices.

Guessmastergiri^TM: Not Applicable.

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(Pre19-SetA) Q63. Consider the following statements:

1. Most of India’s external debt is owed by government entities.
2. All of India’s external debt is denominated in US dollars.

Which of the statements given above is/are correct?
(a) 1 only
(b) 2 only
(c) Both 1 and 2
(d) Neither 1 nor 2
Difficulty: Easy. This is basic information related to Balance of Payment (BoP).

ANS:

• Mrunal’s Youtube Lecture on Balance of Payment Part2: Majority of the external debt is by the private sector’s external commercial borrowing (ECB). So #1 is wrong.
• Second statement is extreme worded hyperbole so it’s wrong. But just to crosscheck: Page 154 of 154 Economic Survey 2016-17: US dollar denominated debt accounted for 55.6 per cent of India’s total external debt at end- September 2016, followed by Indian rupee (30.1 per cent), SDR (5.8 per cent), Japanese Yen (4.8 per cent) Pound Sterling (0.7 per cent), Euro (2.4 per cent) and others (0.6 per cent).

Guessmastergiri^TM Rule#1: Extreme worded statements are always wrong. Here, second statement contains extreme word ‘All’, so, it ought to be wrong, and we are left with 50:50 between A or D.

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(Pre19-SetA) Q65. In the context of India, which of the following factors is/are contributor/contributors to reducing the risk of a currency crisis?

1. The foreign currency earnings of India’s IT sector.
2. Increasing the government expenditure.
3. Remittances from Indians abroad.

Select the correct answer using the code given below.
(a) 1 only
(b) 1 and 3 only
(c) 2 only
(d) 1,2 and 3 only
Difficulty: Easy, for anyone who has the basic understanding of balance of payment and currency exchange rate system. Tough for anyone who has opted to do PHD on it because then he’ll be in perpetual dilemma because of his Birbal-ki-khichdi logics & overthinking.

ANS: Mrunal’s lecture on Pillar#3: BoP- Currency Exchange regimes.

• Currency crisis usually denotes that Indian Rupee is weakening and dollar is strengthening at a rapid level. In ordinary circumstances, rupee dollar exchange rate is determined by the market forces of supply and demand. Therefore we have to encourage the inflow of dollars to reduce the risk of currency crisis. #1 and #3 can help in this regard, #2 is irrelevant. Infact #2 can backfire if raising Government Expenditure results in excessive printing of Rupee currency.
• Thus, by elimination answer is B: 1 and 3.

Guessmastergiri^TM: Not Applicable.

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(Pre19-SetA) Q86. Which one of the following is not the most likely measure the Government/RBI takes to stop the slide of Indian rupee?
(a) Curbing imports of non-essential goods and promoting exports
(b) Encouraging indian borrowers to issue rupee denominated Masala bonds
(c) Easing conditions relating to external commercial borrowing
(d) Following an expansionary monetary policy
Difficulty: Easy, for anyone who has the basic understanding of balance of payment and currency exchange rate system.

ANS: Mrunal’s lecture on Pillar#3: BoP- Currency Exchange regimes. To control rupee weakening,

• A: will help by reducing the Current account deficit.
• B: will help by reducing the demand of dollars in loan-repayment.
• C: will help by increasing the inflow of dollars and other currencies.
• D: will backfire, because rupee currency supply will increase without corresponding increase in the supply of dollars and as a result: dollar will strengthen, Indian Rupee will weaken further. So D is the answer.

Guessmastergiri^TM: Not Applicable.

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(Pre19-SetA) Q71. With reference to Asian Infrastructure Investment Bank (AIIB), consider the following statements:

1. AIIB has more than 80 member nations.
2. India is the largest shareholder in AIIB.
3. AIIB does not have any members from outside Asia.

Which of the statements given above is/are correct?
(a) 1 only
(b) 2 and 3 only
(c) 1 and 3 only
(d) 1, 2 and 3 only
Difficulty: Easy to medium, depending on your revision.

ANS: Mrunal’s lecture on Pillar#3: International Agreements and grouping:

• AIIB: China, India, UK, Switzerland are among the members. And, based on share capital provided. China ~27%, India ~7%. Asian countries control about 75% voting. So, #2 and #3 are wrong. We are left with answer A.

Counter-Argument: Entire question is invalid.

• As per AIIB official website page it has 46 regional members and 28 non-regional members = Total 74 members. There are plenty of names mentioned as prospective members (meaning they’ve not yet become full-fledged members), so first statement which is saying AIIB has 80+ members is wrong / poorly framed, and therefore, entire question is invalid. You may complaint to UPSC via http://upsconline.nic.in/miscellaneous/QPRep/ (Although personally, I don’t think it requires cancellation over such hairsplittery.)

Guessmastergiri^TM Rule#1: Extreme worded statements are always wrong. Here, both second and third statements contain extreme words ‘largest’ and ‘any’ respectively. So, they ought to be wrong and by elimination we are left with the answer A: only 1, #without-studying-anything.

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(Pre19-SetA) Q82. Considering the following statements :

1. Purchasing Power Parity (PPP) exchange rates are calculated by the prices of the same basket of goods and services in different countries.
2. In terms of PPP dollars, India is the sixth largest economy in the world.

Which of the statements given above is/ are correct?
(a) 1 only
(b) 2 only
(c) Both 1 and 2
(d) Neither 1 nor 2
Difficulty: Tough. Second statement requires factual GK.

ANS: Mrunal’s lecture on Pillar#3: Currency Exchange Rate regimes

• PPP: Hypothetical concept that tries to compare two currencies’ exchange rate through their purchasing power in respective countries. – So, If 1 cup of coffee in India = ₹ 20 whereas 1 cup of coffee costs $2 in USA then Dollar to Rupee exchange rate (PPP) should be $1 = ₹ 10. (According to OECD, exact figure is $1=₹ 17@PPP). So, #1 is right.
• Interim Budget Speech 2019: From being the 11th largest economy in the world in 2013-14, we are today the 6th largest in the world. But it doesn’t mention whether this is Compute the nominal exchange rate or PPP. So we’ve to search elsewhere.
• 2014-April, Economic Times: India displaces Japan to become third-largest world economy in terms of PPP: World Bank. So #2 is wrong, we are left with answer A: 1 only.

Guessmastergiri^TM Rule#2: Dates, Years & figures are always wrong in statement. Then #2 ought to be wrong, and we arrive at 50:50 between A or D.

Answerkey-2019: Eco-Pillar#4A: Agriculture

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(Pre19-SetA) Q79. The economic cost of food grains to the Food Corporation Of India is Minimum Support Price and bonus (if any) paid to the farmers plus
(a) Transportation cost only
(b) Interest cost only
(c) Procurement incidentals and distribution costs
(d) Procurement incidentals and charges for godowns
Difficulty: Tough. While the basics of MSP and FCI is known to every serious player but this question is asking about a low profile administrative formula:
ANS: Page 117, Economic Survey 2017-18 Volume 2

• Economic Cost of foodgrains consists of three components,
  • pooled cost of grains, which is the weighted MSP of the stock of foodgrains available with FCI
  • procurement incidentals
  • cost of distribution
• Thus answer is C.

Guessmastergiri^TM Rule#1: Extreme worded statements are always wrong. Here, both option A and B contain extreme word ‘only’. So, they ought to be wrong, and we are left with 50:50 between C or D.

Answerkey-2019: Eco-Pillar#4: Sectors of Economy

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(Pre19-SetA) Q3. The Global Competitiveness Report is published by the
(a) International Monetary Fund
(b) United Nations Conference on Trade and Development
(c) World Economic Forum
(d) World Bank
Difficulty: Easy to medium depending on your revision & recollection.

ANS: Mrunal’s lecture on Pillar#4: Mfg & Ease of doing business

• Global Competitiveness Report is prepared by World Economic Forum. 2018 ranking: 1) USA, 2) Singapore, 3) Germany…. 28) China, 58) India…. 140) Chad the last.

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(Pre19-SetA) Q77. Which one of the following is not a sub-index of the World Bank’s ‘Ease of Doing Business Index?
(a) Maintenance of law and order
(b) Paying taxes
(c) Registering property
(d) Dealing with construction permits
Difficulty: Easy. Too much in news because of India’s improvement in ranking

ANS: Mrunal’s lecture on Mfg & Ease of doing business : World Bank’s Ease of Doing Biz based on simple average (equally weighted) of 10 parameters viz.

1. Starting a Business
2. Construction Permits
3. Getting Electricity
4. Registering Property
5. Getting Credit (loan)
6. Protecting Minority Investors
7. Paying Taxes
8. Trading across Borders
9. Enforcing Contracts
10. Resolving Insolvency

So, A is the answer.
Guessmastergiri^TM: Not Applicable.

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(Pre19-SetA) Q19. Atal innovation mission is set up under the
(a) Department of science of technology
(b) Ministry of labour and employment
(c) NITI Ayog
(d) Ministry of skill development and entrepreneurship
Difficulty: Easy. Very cliched topic.

ANS: Mrunal’s lecture on Pillar#4: Mfg & Ease of doing business

• Atal Innovation Mission in NITI Ayog to help the innovators. E.g. launch challenges / competitions and award prize money. Alternatively,
• India Yearbook 2019 (MinI&B) | हिंदी में भी उपलब्ध ch.23 Planning: The Atal Innovation Mission (AIM) is a flagship initiative of the Prime Minister, set up by NITI Aayog to promote innovation and entrepreneurship across the length and breadth of the country.

Guessmastergiri^TM: Not Applicable.

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(Pre19-SetA) Q57. Consider the following statements:

1. According to the Indian Patents Act, a biological process to create a seed can be patented in India.
2. In India, there is no Intellectual Property Appellate Board.
3. Plant Varieties are not eligible to the patented in India.

Which of the statements given above is/ are correct?
(a) 1 and 3 only
(b) 2 and 3 only
(c) 3 only
(d) 1,2, and 3
Difficulty: Tough. IPR not covered in this much depth in routine books.

ANS: Mrunal’s lecture on Pillar#4: Mfg & Ease of doing business

• National IPR Policy 2016 shifted the Copyright Office and its statutory body Intellectual Property Appellate Board (IPAB) from HRD ministry to commerce ministry. So, #2 is wrong, by elimination we are at 50:50 stage between option A or C. So, everything down to whether the first statement is correct or not?
• India Patent Act: Chapter 2: Inventions not patentable: Bullet (j): plants and animals in whole or any part thereof, including seeds, varieties and species. So, #1 is wrong, #3 is right, answer is C.

Guessmastergiri^TM Rule#1: Extreme statement is ALWAYS wrong So, #2 and #3 ought to be wrong. However, this is a poorly drafted question, because in all four options, third statement is common so #3 has to be right, as an ‘exception’ to Guessmaster rules. That means by Guessmastergiri^TM Rule#1, only #2 is wrong so arrive at 50:50 between A or C.

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(Pre19-SetA) Q60. As per the Industrial Employment (Standing Orders) Central (Amendment) Rules ,2018:

1. If rules for fixed-term employment are implemented, it becomes easier for the firms/companies to lay off workers
2. No notice of termination of employment shall be necessary in the case of temporary workman

Which of the following statements given above is/are correct
(a) 1 only
(b) 2 only
(c) Both 1 and 2
(d) Neither 1 nor 2
Difficulty: Tough. Low profile topic, minute details asked.
ANS: 2018-March: IndianExpress: As per the the Industrial Employment (Standing Orders) Central (Amendment) Rules, 2018:

• No workman employed on fixed term employment basis shall be entitled to any notice or pay, if his services are terminated by non-renewal of contract. So, #1 is right.
• No notice of termination of employment shall be necessary in the case of temporary workman. So, #2 is right. Answer C: both correct.

Anti-Guessmaster Question: Because Guessmastergiri^TM Rule#1: Extreme statement is ALWAYS wrong then statement#2 ought to be wrong but if you believe that you’ll not arrive at right answer C.

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(Pre19-SetA) Q70. With reference to India’s Five Year Plans, which of the following statements is/are correct?

1. From the Second Five-Year Plan, there was a determined thrust towards substitution of basic and capital good industries.
2. The Fourth Five-Year Plan adopted the objective of correcting the earlier trend of increased concentration of wealth and economic power.
3. In the Fifth Five-Year Plan, for the first time, the financial sector was included as an integral part of the Plan.

Select the correct answer using the code given below
(a) 1 and 2 only
(b) 2 only
(c) 3 only
(d) 1,2 and 3
Difficulty: Tough. Since the coming of Modi government, UPSC has been asking Niti Aayog centered questions in both IAS prelims & Mains. Five Year plans became a low profile topic, besides here very minute details asked about individual plans.
ANS: India Yearbook 2019 (MinI&B) | हिंदी में भी उपलब्ध ch.23 on Planning

• 2nd FYP: rapid industrialization with particular emphasis on the development of basic and heavy industries so Statement1 is correct. This eliminates B and C. The correct answer could be A or D. In both these options, second statement is common so we should accept statement #2 to be correct without checking its validity.
• 5th FYP: Fifth Plan (1974-79) was formulated against the backdrop of severe inflationary pressures. objectives of the plan were to achieve self-reliance and adopt measures for raising the consumption standard of people living below the poverty line. This Plan also gave high priority to bring inflation under control and to achieve stability in the economic situation. It targeted an annual growth rate of 5.5 percent in the national income. There is no mention of Financial Sector here, so #3 is wrong. We are left with Answer A: only 1 and 2.

Guessmastergiri^TM Rule#1: Extreme statement is ALWAYS wrong. Third statement contains extreme word ‘first’ so it ought to be be wrong and by elimination we are at 50-50 stage between A or C.

Answerkey-2019: Eco-Pillar#4: Labour Rights

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(Pre19-SetA) Q76. Which of the following statements is/are correct regarding the Maternity Benefit (Amendment) Act, 2017?

1. Pregnant women are entitled for three months pre-delivery and three months post-delivery paid leave
2. Enterprises with creches must allow the mother minimum six creche visits daily
3. Women with two children get reduced entitlements.

Select the correct answer using the code given below
(a) 1 and 2 only
(b) 2 only
(c) 3 only
(d) 1,2 and 3
Difficulty: Tough. While the basics of Maternity Benefit is known to every serious player but this question requires minute factualGK / salient features of an Act & it’s not a ‘high profile’ Act (unlike Food Security Act or MNREGA Act). Even India Yearbook doesn’t contain the full list of these salient micro-features asked here.
ANS: PRSIndia Page on this act.

• In case of a woman who has two or more children, the maternity benefit will continue to be 12 weeks. If less than two children then she’ll get 26 weeks paid leave. So, #3 is right. Answer could be C or D.
• Every establishment with 50 or more employees to provide crèche facilities within a prescribed distance. The woman will be allowed four visits to the crèche in a day. So #2 is wrong. We are left with Answer C: only 3.

Guessmastergiri^TM Rule#1: Extreme statement is ALWAYS wrong and Guessmastergiri^TM Rule#2: Dates, Years & figures are always wrong in statement. By both the rules, Statement 2 ought to be wrong, and by elimination Answer should be C #Without-Studying-Anything.

Answerkey-2019: Eco-Pillar#5: Infrastructure

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(Pre19-SetA) Q74. Consider the following statements :

1. Petroleum and Natural Gas Regulatory Board (PNGRB) is the first regulatory body set up by the Government of India.
2. One of the tasks of PNGRB is to ensure competitive markets for gas.
3. Appeals against the decisions of PNGRB go before the Appellate Tribunals of Electricity.

Which of the statements given above is/are correct?
(a) 1 and 2 only
(b) 2 and 3 only
(c) 1 and 3 only
(d) 1,2 and 3
Difficulty: Tough. This is a low profile regulatory body, not covered in such depth in any routine books. तो साला इस पर इतना Ph.D कौन करता है!?
ANS: Stupid About us page of the organization:

• PNGRB was constituted under The Petroleum and Natural Gas Regulatory Board Act, 2006.
• SEBI was formed in 1988 by an executive order, given statutory status in 1992. Besides, IRDAI and many other regulatory bodies were setup before 2006. So, PNGRB is certainly not the first body to be setup by Govt of India. #1 is wrong, by elimination we are left with answer B.

Guessmastergiri^TM Rule#1: Extreme statement is ALWAYS wrong so Statement 1 ought to be wrong because it contains extreme word ‘first’, and by elimination Answer should be B #Without-Studying-Anything.

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(Pre19-SetA) Q48. Consider the following statements:

1. Coal sector was nationalized by the Government of India under Indira Gandhi.
2. Now, coal blocks are allocated on lottery basis.
3. Till recently, India imported coal to meet the shortages of domestic supply, but now india is self-sufficient in coal production.

Which one of the following statements given above is/ are correct?
(a) 1 only
(b) 2 and 3 only
(c) 3 only
(d) 1,2 and 3
Difficulty: Easy to Medium, Depending on your memory power of prime ministers timelines.

ANS: Mrunal’s lecture on Pillar#5: Infrastructure, Subtopic-Energy

• 1973: Coal Mines Nationalization Act- Coal India and other CPSEs took over private coal mining companies. They will dig coal, sell it to thermal power plants & other industries. (Indira Gandhi was PM at that time.) So, #1 is right. Answer could be A or D.
• 2015: Coal Mines Special Provision Act: It opens up commercial coal mining for both private and public entities, and thus ends monopoly of Coal India. Presently, coal blocks are allotted on basis of auction. #2 is wrong, B and D eliminated.
• Thus Answer A: 1 only.

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(Pre19-SetA) Q62. With reference to the management of minor minerals in India, consider the following statements :

1. Sand is a ‘minor mineral’ according to the prevailing law in the country.
2. State Governments have the power to grant mining leases of minor minerals, but the powers regarding the formation of rules related to the grant of minor minerals lie with the Centre Government.
3. State Governments have the power to frame rules to prevent illegal mining of minor minerals.

Which of the statements given above is/are correct?
(a) 1 and 3 only
(b) 2 and 3 only
(c) 3 only
(d) 1, 2 and 3 only
Difficulty: Medium to Tough. While the basics of minor minerals is known to every serious player, this question demands further knowledge of Administrative procedures.

ANS: Mrunal’s lecture on Pillar#5: Infrastructure, Subtopic-Mining

• By and large non-metallic non-energy minerals fall under ‘Minor’ category. So #1 should be true.
• While the ‘regulation of mines and mineral development’, falls under Union List. But, Minor minerals: their legislation, royalty, administrative work is delegated to the States’ domain. So, prima facie, all 3 statements should be correct.
• Just to crosscheck: India Yearbook 2019 (MinI&B) | हिंदी में भी उपलब्ध ch19 on Industries: Section 15 of MMDR Act, 1957 empowers state governments to frame rules for regulating the grant of quarry leases, mining leases or other mineral concessions in respect of minor minerals; accordingly all state governments and some union territories have framed their own rules in this regard. So, that means #2 is right and #3 is wrong.
• Indian Bureau of Mines of has given the list of Minor Minerals viz. 1. Agate, 2. Ball clay, 3. Barytes, 4. Calcareous sand, 5. Calcite, 6. Chalk, 7. China Clay, 8. Clay (others), 9. Corundum, 10. Diaspore, 11. Dolomite, 12. Dunite or pyroxenite, 13. Felsite, 14. Felspar, 15. Fire clay, 16. Fuschite Quartzite, 17. Gypsum, 18. Jaspar, 19. Kaolin, 20. Laterite, 21. Limekankar, 22. Mica, 23. Ochre, 24. Pyrophyllite, 25. Quartz, 26. Quartzite, 27. Sand (others), 28. Shale, 29. Silica sand, 30. Slate, 31. Steatite or talc or soapstone. So #1 is also correct.
• Accordingly, the answer is A: 1 and 3.

Guessmastergiri^TM: Not Applicable.

Answerkey-2019: Eco-Pillar#6: HRD

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(Pre19-SetA) Q24. In a given year in India, official poverty lines are higher in some states than in other because
(a) Poverty rates vary from state to state
(b) Price levels vary from state to state
(c) Gross state product varies from state to state
(d) Quality of public distribution varies from state to state
Difficulty: Tough. This much depth is not covered in routine books on Economy.
ANS: Page 19, Asian Development Bank document on Understanding poverty in India.

• Poverty lines are estimated using the original state-specific poverty lines identified by the Expert Group and updating them to 2004–2005 prices using the Consumer Price Index of Agricultural Laborers (CPIAL) for rural poverty lines and Consumer Price Index for Industrial Workers (CPIIW) for urban poverty lines.
• So, B: price levels is the most appropriate choice.

Guessmastergiri^TM: Not Applicable.

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(Pre19-SetA) Q80. In the context of any country which one of the following would be considered as part of its social capital?
(a) The proportion of literates in the population.
(b) The stock of its buildings, other infrastructure and machines.
(c) The size of the population in the working age group.
(d) The level of mutual trust and harmony in the society.
Difficulty: Medium to Tough.
ANS:

• A: Human Capital would be a suitable word.
• B: Economic capital or tangible capital would be a suitable word.
• C: Demographic dividend would be a suitable word.
• By elimination we are left with Ans D.
• To crosscheck: NCERT Class12 Sociology-Indian Society, page 84: social capital in the form of networks of contacts and social associations….Someone with influential relatives and friends (social capital) may – through access to good advice, recommendations or information – manage to get a well-paid job. So D seems more suitable than other options. Random Google book page 286

Guessmastergiri^TM Rule#5: Word Association. ‘Social Trust’: only one option has society / social word and that is ‘D’. so it should be the answer #Without-Studying-Anything.
Stay tuned for the remaining subjects’ Answerkeys.