Industrial Sector (Part – II)

Total Questions: 60

11. Consider the following statements: [I.A.S. (Pre) 2019]

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 of the statements given above is/are correct?

 

Correct Answer: (a) 1 only
Solution:India's coal industry was predominantly driven by the private sector after independence until the Indira Gandhi government decided to transfer all private sector coal holdings to Coal India through the Coal Mines (Nationalisation) Act, 1973. Thus, statement 1 is correct. As per the Coal Mines (Special Provisions) Act, 2015, coal mines/blocks are allocated by way of public auction. Thus, statement 2 is incorrect.

Statement 3 is also incorrect as India is still not self- sufficient in coal production and import about 25 percent of domestic coal demand to meet the shortages of domestic supply.

12. Which is not included in manufacturing sector? [Chhattisgarh P.C.S. (Pre) 2016]

Correct Answer: (e) Construction Industry
Solution:Manufacturing sector is the agglomeration of industries engaged in chemical, mechanical, or physical transformation of materials, substances or components into consumer or industrial goods. Large, small scale, micro and medium size industries are included in manufacturing sector while construction industry is not included in manufacturing                            Construction is the process of creating buildings, roads, bridges, and other infrastructure. It involves the use of raw materials, such as wood, concrete, and steel, to construct structures that are designed to meet specific needs and requirements. Construction projects can range from small renovations to large-scale developments and can take anywhere from a few weeks to several years to complete. The end product of construction is a physical structure that can be used for various purposes, such as housing, commercial or industrial use, transportation, or recreation.
Manufacturing, on the other hand, is the process of creating goods through the use of machines, tools, and labor. It involves the use of raw materials, such as metals, plastics, and chemicals, to produce a wide range of products, such as automobiles, electronics, and household goods. Manufacturing processes can range from simple assembly to complex and sophisticated processes such as 3D printing. The end product of manufacturing is a physical good that can be used for various purposes, such as personal use, commercial use, or industrial use.

13. Consider the following statements about Micro, Small and Medium Enterprises (MSME) Act, 2020: [U.P.R.O./A.R.O. (Mains) 2016]

1. The Government of India announced a revision in MSME definition in the Atmanirbhar Bharat Package on 13th May, 2020.

2. The change in definition is effective from 1st June, 2020.

3. The new definition has the same formula of classification of manufacturing and service units.

Which are correct among the above statements?

Code:

Correct Answer: (b) 1 and 3 only
Solution:The Government of India announced a revision in MSME definition in the Atmanirbhar Bharat Package on 13th May, 2020 and notified this on 1 June, 2020 in Official Gazette. The new definition and criteria came into effect from 1 July, 2020. Under this, a new composite formula of classification for manufacturing and service units has been notified and now, there is no difference between manufacturing and service sectors. As per the new classification, the definition of micro unit is increased to Rs.1 crore of investment and Rs.5 crore of turnover. The limit of small scale unit is increased to Rs.10 crore of investment and Rs.50 crore of turnover. Similarly, now the limit of medium scale unit is revised to Rs.50 crore of investment and Rs.250 crore of turnover under this notification.

14. In which of the following year, the latest classification of MSME was done? [Uttarakhand P.C.S. (Pre) 2021]

Correct Answer: (d) 2020
Solution:The Government of India announced a revision in MSME definition in the Atmanirbhar Bharat Package on 13th May, 2020 and notified this on 1 June, 2020 in Official Gazette. The new definition and criteria came into effect from 1 July, 2020. Under this, a new composite formula of classification for manufacturing and service units has been notified and now, there is no difference between manufacturing and service sectors. As per the new classification, the definition of micro unit is increased to Rs.1 crore of investment and Rs.5 crore of turnover. The limit of small scale unit is increased to Rs.10 crore of investment and Rs.50 crore of turnover. Similarly, now the limit of medium scale unit is revised to Rs.50 crore of investment and Rs.250 crore of turnover under this notification.

15. In Industrial Policy of 1991, the investment amount for small scale industries approved for general and auxiliary units was: [M.P.P.C.S. (Pre) 1991*]

Correct Answer: (a) Rs. 45 lakh, Rs. 50 lakh
Solution:In Industrial Policy of 1991, investment limit for small enterprises had been raised from Rs. 35 Lakh to Rs. 60 Lakh and investment limit in auxiliary units was raised from Rs. 45 lakh to Rs. 75 lakh. Under Micro, Small and Medium Enterprises (MSME) Development Act, 2006 investment limit for Micro, Small and Medium enterprises had been classified into two groups:

(A) Manufacturing enterprises (B) Service Enterprises.

Under the Act of 2006, criteria for investment in machinery and equipments were as follows:

SectorMicroSmall Medium
ManufacturingNot more than Rs.25 lakhRs. 25 lakh to

Rs. 5 crore

Rs. 5 crore to

Rs. 10 crore

ServicesNot more than Rs.10 lakhRs. 10 lakh to

Rs. 2 crore

Rs. 2 crore to

Rs. 5 crore

On June 1, 2020, under Aatmanirbhar Bharat Abhiyan (ABA), Ministry of Micro, Small and Medium Enterprises has revised the MSME classification by inserting a composite criterion for both investment in plant and machinery and annual turnover of enterprises. The new definition has the same formula of classification for manufacturing and service enterprises.

Revised classification applicable w.e.f, 1st July 2020
 CriteriaMicroSmallMedium
Investment in plant & Machinery EquipmentNot more than Rs. 1 croreNot more than Rs. 10 croreNot more than Rs. 50 crore
Annual TurnoverNot more than Rs. 5 croreNot more than Rs. 50 croreNot more than Rs. 250 crore

 

16. Which of the following partly defines the micro-enterprises in India? [B.P.S.C (Pre) (Re. Exam) 2022]

Correct Answer: (a) Investment in Plant and Machinery or equipment not more than Rs. 1 crore
Solution:In Industrial Policy of 1991, investment limit for small enterprises had been raised from Rs. 35 Lakh to Rs. 60 Lakh and investment limit in auxiliary units was raised from Rs. 45 lakh to Rs. 75 lakh. Under Micro, Small and Medium Enterprises (MSME) Development Act, 2006 investment limit for Micro, Small and Medium enterprises had been classified into two groups:

(A) Manufacturing enterprises (B) Service Enterprises.

Under the Act of 2006, criteria for investment in machinery and equipments were as follows:

SectorMicroSmall Medium
ManufacturingNot more than Rs.25 lakhRs. 25 lakh to

Rs. 5 crore

Rs. 5 crore to

Rs. 10 crore

ServicesNot more than Rs.10 lakhRs. 10 lakh to

Rs. 2 crore

Rs. 2 crore to

Rs. 5 crore

On June 1, 2020, under Aatmanirbhar Bharat Abhiyan (ABA), Ministry of Micro, Small and Medium Enterprises has revised the MSME classification by inserting a composite criterion for both investment in plant and machinery and annual turnover of enterprises. The new definition has the same formula of classification for manufacturing and service enterprises.

Revised classification applicable w.e.f, 1st July 2020
 CriteriaMicroSmallMedium
Investment in plant & Machinery EquipmentNot more than Rs. 1 croreNot more than Rs. 10 croreNot more than Rs. 50 crore
Annual TurnoverNot more than Rs. 5 croreNot more than Rs. 50 croreNot more than Rs. 250 crore

17. In India, businesses with an investment upto Rs. 1 crore and turnover upto Rs. 5 crore are known as : [U.P.R.O./A.R.O. (Pre) 2021]

Correct Answer: (c) Micro Enterprise
Solution:In Industrial Policy of 1991, investment limit for small enterprises had been raised from Rs. 35 Lakh to Rs. 60 Lakh and investment limit in auxiliary units was raised from Rs. 45 lakh to Rs. 75 lakh. Under Micro, Small and Medium Enterprises (MSME) Development Act, 2006 investment limit for Micro, Small and Medium enterprises had been classified into two groups:

(A) Manufacturing enterprises (B) Service Enterprises.

Under the Act of 2006, criteria for investment in machinery and equipments were as follows:

SectorMicroSmall Medium
ManufacturingNot more than Rs.25 lakhRs. 25 lakh to

Rs. 5 crore

Rs. 5 crore to

Rs. 10 crore

ServicesNot more than Rs.10 lakhRs. 10 lakh to

Rs. 2 crore

Rs. 2 crore to

Rs. 5 crore

On June 1, 2020, under Aatmanirbhar Bharat Abhiyan (ABA), Ministry of Micro, Small and Medium Enterprises has revised the MSME classification by inserting a composite criterion for both investment in plant and machinery and annual turnover of enterprises. The new definition has the same formula of classification for manufacturing and service enterprises.

Revised classification applicable w.e.f, 1st July 2020
 CriteriaMicroSmallMedium
Investment in plant & Machinery EquipmentNot more than Rs. 1 croreNot more than Rs. 10 croreNot more than Rs. 50 crore
Annual TurnoverNot more than Rs. 5 croreNot more than Rs. 50 croreNot more than Rs. 250 crore

18. Micro, Small and Medium Enterprises Development (MSMED) Act was passed in the year : [R.A.S./R.T.S.(Pre) 1994]

Correct Answer: (b) 2006
Solution:In Industrial Policy of 1991, investment limit for small enterprises had been raised from Rs. 35 Lakh to Rs. 60 Lakh and investment limit in auxiliary units was raised from Rs. 45 lakh to Rs. 75 lakh. Under Micro, Small and Medium Enterprises (MSME) Development Act, 2006 investment limit for Micro, Small and Medium enterprises had been classified into two groups:

(A) Manufacturing enterprises (B) Service Enterprises.

Under the Act of 2006, criteria for investment in machinery and equipments were as follows:

SectorMicroSmall Medium
ManufacturingNot more than Rs.25 lakhRs. 25 lakh to

Rs. 5 crore

Rs. 5 crore to

Rs. 10 crore

ServicesNot more than Rs.10 lakhRs. 10 lakh to

Rs. 2 crore

Rs. 2 crore to

Rs. 5 crore

On June 1, 2020, under Aatmanirbhar Bharat Abhiyan (ABA), Ministry of Micro, Small and Medium Enterprises has revised the MSME classification by inserting a composite criterion for both investment in plant and machinery and annual turnover of enterprises. The new definition has the same formula of classification for manufacturing and service enterprises.

Revised classification applicable w.e.f, 1st July 2020
 CriteriaMicroSmallMedium
Investment in plant & Machinery EquipmentNot more than Rs. 1 croreNot more than Rs. 10 croreNot more than Rs. 50 crore
Annual TurnoverNot more than Rs. 5 croreNot more than Rs. 50 croreNot more than Rs. 250 crore

19. The limit of capital investment for small scale industries as per New Industrial Policy, 1991 is: [R.A.S./R.T.S.(Pre) 1994]

Correct Answer: (b) Rs. 60 lakh
Solution:In Industrial Policy of 1991, investment limit for small enterprises had been raised from Rs. 35 Lakh to Rs. 60 Lakh and investment limit in auxiliary units was raised from Rs. 45 lakh to Rs. 75 lakh. Under Micro, Small and Medium Enterprises (MSME) Development Act, 2006 investment limit for Micro, Small and Medium enterprises had been classified into two groups:

(A) Manufacturing enterprises (B) Service Enterprises.

Under the Act of 2006, criteria for investment in machinery and equipments were as follows:

SectorMicroSmall Medium
ManufacturingNot more than Rs.25 lakhRs. 25 lakh to

Rs. 5 crore

Rs. 5 crore to

Rs. 10 crore

ServicesNot more than Rs.10 lakhRs. 10 lakh to

Rs. 2 crore

Rs. 2 crore to

Rs. 5 crore

On June 1, 2020, under Aatmanirbhar Bharat Abhiyan (ABA), Ministry of Micro, Small and Medium Enterprises has revised the MSME classification by inserting a composite criterion for both investment in plant and machinery and annual turnover of enterprises. The new definition has the same formula of classification for manufacturing and service enterprises.

Revised classification applicable w.e.f, 1st July 2020
 CriteriaMicroSmallMedium
Investment in plant & Machinery EquipmentNot more than Rs. 1 croreNot more than Rs. 10 croreNot more than Rs. 50 crore
Annual TurnoverNot more than Rs. 5 croreNot more than Rs. 50 croreNot more than Rs. 250 crore

20. Investment in Plant and Machinery in a small scale manufacturing unit should be: [U.P.R.O./A.R.O. (Pre) 2016]

Correct Answer: (c) Above Rs. 25 lakhs but not more than Rs. 5 crore
Solution:As per the question period, option (c) was the correct answer. In Industrial Policy of 1991, investment limit for small enterprises had been raised from Rs. 35 Lakh to Rs. 60 Lakh and investment limit in auxiliary units was raised from Rs. 45 lakh to Rs. 75 lakh. Under Micro, Small and Medium Enterprises (MSME) Development Act, 2006 investment limit for Micro, Small and Medium enterprises had been classified into two groups:

(A) Manufacturing enterprises (B) Service Enterprises.

Under the Act of 2006, criteria for investment in machinery and equipments were as follows:

SectorMicroSmall Medium
ManufacturingNot more than Rs.25 lakhRs. 25 lakh to

Rs. 5 crore

Rs. 5 crore to

Rs. 10 crore

ServicesNot more than Rs.10 lakhRs. 10 lakh to

Rs. 2 crore

Rs. 2 crore to

Rs. 5 crore

On June 1, 2020, under Aatmanirbhar Bharat Abhiyan (ABA), Ministry of Micro, Small and Medium Enterprises has revised the MSME classification by inserting a composite criterion for both investment in plant and machinery and annual turnover of enterprises. The new definition has the same formula of classification for manufacturing and service enterprises.

Revised classification applicable w.e.f, 1st July 2020
 CriteriaMicroSmallMedium
Investment in plant & Machinery EquipmentNot more than Rs. 1 croreNot more than Rs. 10 croreNot more than Rs. 50 crore
Annual TurnoverNot more than Rs. 5 croreNot more than Rs. 50 croreNot more than Rs. 250 crore