Question Discussion & Solution

The correct answer is Cash reserve ratio.

Key Points

• The Cash Reserve Ratio (CRR) refers to the share of Net Demand and Time Liabilities that banks have to hold as balances with the RBI.
• The objective of CRR is to keep inflation under control.
• During high inflation in the economy, the central bank raises the CRR to lower the bank’s loanable funds.
• The current Cash Reserve Ratio is 4.00% (as of June 2021).
• The current Reverse repo rate is 3.35% (as of June 2021).
• The Central bank has the authority to regulate monetary policies.
• The Ministry of Finance has the authority to regulate fiscal policies.

Additional Information

• Marginal Standing facility:
  • MSF is a facility under which scheduled commercial banks can borrow an additional amount of overnight money from the RBI by dipping into their SLR portfolio up to a limit at a penal rate of interest. 
  • This provides a safety wall against unanticipated liquidity shocks to the banking system.
  • The MSF is a scheme launched by RBI in 2011-12.
  • Under MSF banks can borrow funds up to 1% of their net demand and time liability.
  • The minimum amount for which RBI receives application is Rs. 1 crore and afterwards in multiples of rupees 1 crore.
• ​SLR is a kind of reserve that commercial banks need to maintain before crediting their money to borrowers.
  • Regulating the SLR rates is a component of RBI's monetary policy.
  • Reserve Bank of India sets the limit for banks (under Banking Regulation Act, 1949) to hold a certain proportion of their assets as SLR.
• Repo Rate:- It is a rate at which the central bank (RBI) lends money to its clients against the government securities.
• Reverse Repo- It is the rate at which the central bank (RBI) borrows money from its clients.
  • Reverse Repo is used in India as a tool in which banks will give their surplus fund to RBI for a short-term period and earn money.
  • The repo rate is always higher than the reverse repo rate.
  • Repo and Reverse repo rates are decided by the Monitory policy committee (MPC) of RBI.

The correct answer is Andhra Pradesh.

Key Points

• Andhra Pradesh
  • Andhra Pradesh had the largest area (2010) under tobacco cultivation.
  • With rich black soil and irrigation facilities, the state is bestowed with high-grade production of tobacco. 
  • It is next to Cuban tobacco which is considered rich in quality in the world.  
  • The tobacco research institute is situated at Rajahmundry in Andhra Pradesh state
  • Recently, Andhra Pradesh is the highest producer of tobacco in India and as per the government records, the tobacco production in this state is estimated to be at 110 million kilograms.

Additional Information

• Uttar Pradesh: The Uttar Pradesh state is famous for its wheat and sugar cane production.
  • It is the largest state in terms of population and as well area in India.
• Karnataka: The Karnataka state is the leading producer of coffee with rich climatic conditions.
  • It has many mineral resources like bauxite iron ore etc.
• Gujarat: The Gujarat state is famous for its cotton production, petrochemical complex, natural ports, fishing zones, etc.

The correct answer is Department for Promotion of Industry and Internal Trade.

Key Points

• Department for Promotion of Industry and Internal Trade is the nodal department for the formulation of the policy on Foreign Direct Investment (FDI).
  • It is a central government department under the Ministry of Commerce and Industry.
  • It controls the maintenance and management of data on inward FDI into India.
  • The Department for Promotion of Industry and Internal Trade plays a vital role in the liberalization and rationalization of the FDI policy.

 Additional Information

The correct answer is 2005-06.

• Magra Regional Development Programme was started in 2005-06.

Key Points

• ​Objective-
  • Social and economic development of the Magra region.
  • Infrastructure development in this region like- enhance health and education facilities in this region.
  • Employment generation in this region.
• Covered districts- Ajmer, Bhilwara, Chittorgarh, Pali, Rajasamand
• Total Panchayat Samiti covered- 16
• Total village covered- 1715
• Financed by - State Government

The correct answer is 2011-12.

Key Points

• The Index of Industrial Production (IIP)
  • It is a short-term macroeconomic indicator widely used in measuring the industrial growth of the State.
  • The index indicates the relative change over time in the volume of production in the industrial sector and it is an effective tool to measure the trend of current industrial production.
  • Presently IIP is constructed based on the base year 2011-12. Hence, Option 3 is correct.
  • The Directorate of Economics and Statistics, Department of Planning, Rajasthan has been compiling/releasing an index of industrial production for the Rajasthan State since 1971 as per the guidelines of the Central Statistical Office (CSO), Govt. of India.
  • New base year IIP series based on 156 items/product groups for the manufacturing sector.
  • Shifting of the base year 2011-12 are in process to get monthly Production data from April 2011 onwards for a selected item for selected units in the prescribed format given by C.S.O.
  • Three major sectors in IIP 
    • Manufacturing:- For Manufacturing Sector the Production data is collecting for selected items from selected industrial units through district statistical officer’s and Now IIP web Portal has been developed for the collection of regular data from districts through an online system.
    • Mining:- Mining sector production data is supplied by the Indian Bureau of Mines, (IBM) Nagpur.
    • Electricity:- Electricity sector generation figures furnished by the Central Electricity Authority New Delhi.