International Organizations (Part – I)

Total Questions: 50

21. According to the World Bank's development report, the position of the Indian economy in the world is the : [B.P.S.C. (Pre) 2008]

Correct Answer: (e) None of the above
Solution:None of the given options was correct as per the question period. As per the World Development Report 2008 of the World Bank, Indian economy was the fourth largest economy in terms of PPP. According to the World Bank's data, Indian economy had overtaken UK to became the 5th largest economy (after USA, China, Japan and pandemic impact, India have been pushed back to being economy in 2020. However, the IMF and World Bank data, India again surpassed UK to become the world's fifth biggest economy (in terms of nominal GDP) in 2022.

22. Measured in terms of Purchasing Power Parity, Indian economy continues to be the 4th largest country in the world. The first three positions are occupied by: [U.P.P.C.S. (Mains) 2009]

Correct Answer: (d) USA, China, Japan
Solution:According to Purchasing Power Parity (PPP) metric, in 2009, the world's four largest economies (on the basis of PPP $ were USA, China, Japan and India, while at present (in 2022) they are: 1. China, 2. USA, 3. India, 4. Japan.
  • Purchasing Power Parity (PPP) is described as the number of units of a country's currency necessary to purchase the same number of products on the domestic economy as one dollar would purchase in the United States
  • The Purchase power parity approach enables us to determine the amount of exchange required between two currencies to accurately depict the buying power of the currency pairs in their respective nations
  • For illustration, a cell phone that costs roughly 3000 rupees in India would cost around USD 40 in the United States if the currency rate is 75 rupees to one.

23. In terms of PPP the Indian economy's rank in the world is: [U.P.P.C.S. (Mains) 2005]

Correct Answer: (b) 4th
Solution:As per the question period, in terms of PPP the Indian economy's rank in the world was 4th. India emerged as the world's third-largest economy in terms of PPP in 2011.At present, Indian economy is still the 3rd largest economy of the world in terms of PPP (after China and USA).
  • Purchasing Power Parity (PPP) is described as the number of units of a country's currency necessary to purchase the same number of products on the domestic economy as one dollar would purchase in the United States
  • The Purchase power parity approach enables us to determine the amount of exchange required between two currencies to accurately depict the buying power of the currency pairs in their respective nations
  • For illustration, a cell phone that costs roughly 3000 rupees in India would cost around USD 40 in the United States if the currency rate is 75 rupees to one.

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

1. Purchasing Power Parity (PPP) exchange rates are calculated by comparing 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?

Correct Answer: (a) 1 only
Solution:Purchasing Power Parity (PPP) is a popular macroeconomic analysis metric to compare economic productivity and standards of living between countries. PPP compares different countries' currencies through a 'basket of goods and ser vices' approach.

PPP theory states that exchange rates be- tween currencies are in equilibrium when their purchasing power is the same in each of the two countries. Thus, PPP exchange rates are calculated by comparing the prices of the same basket of goods and services in different countries. So, statement 1 is correct.

In terms of PPP dollars, China is the world's largest economy in 2018 (and also in 2022), followed by USA at 2nd and India al3rd position. Hence, statement 2 is incorrect. In terms of nominal GDP, India is at present (in 2022) the fifth largest economy of the world after USA (1), China (2nd), Japan (3) and Germany (4th),

25. According to American based think tank Population Review Report 2020, which of the following statements is/are correct? [U.P. R.O/A.R.O. (Re-Exam) (Pre) 2016]

1. India's GDP in 2019 was Rs. 209 lakh crore.

2. India emerged as fifth largest economy of the world.

3. India overtook countries like Britain and France.

Select the correct answer using codes given below:

Codes:

Correct Answer: (d) 1, 2 and 3 correct
Solution:According to the World Bank and American based think tank Population Review Report 2020, India's GDP in 2019 was 2875142 million dollars (about Rs. 209 lakh crore). Indian economy was fifth largest economy (in terms of nominal GDP) of the world in 2019, after US, China, Japan and Germany and India had overtaken countries like Britain and France.

Hence, as per question period all of the given statements were correct. However, due to COVID-19 pandemic impact, India had been pushed back to being the world's sixth largest economy in 2020 but it again returned to fifth position in 2022.

26. As per World Development Report of the World Bank, 2008 arrange the following countries according to the size of their economy in descending order. State which one of the following is the correct order: [U.P.P.C.S. (Mains) 2009, U.P. Lower Sub. (Spl.) (Pre) 2008]

Correct Answer: (c) USA > China > UK > India
Solution:According to the World Development Report, 2008, the correct descending order of the given major economies in terms of nominal GDP was USA > China > UK > India. India had overtaken the UK in 2019 to become the fifth largest economy (after USA, China, Japan & Germany) in the world in terms of nominal GDP (US $) but had been relegated by the UK to 6th spot again in 2020. However, India regained the fifth position in 2022.

27. India aims to achieve the 5 trillion dollar economy by: [U.P. P.C.S. (Pre) 2020, U.P.B.E.O. (Pre) 2019]

Correct Answer: (b) 2024
Solution:Prime Minister Narendra Modi in 2019 envisioned making India a 5 trillion US dollar economy and a global economic powerhouse by 2024-25. However, due to COVID-19 pandemic, achievement of this target may be delayed.

India is one of the fastest growing major economies and is currently ranked as the world's sixth largest economy. Projections of growth, over the medium term, remain encouraging and optimistic for India. The underlying strengths are indicative of the potential of India to achieve a USD 5 trillion economy by 2025. The current structure of the economy and the emerging dynamics provide us grounds to target achieving 1 trilliondollarfrom agriculture and allied activities, 1 trillion from manufacturing and 3 trillionfrom services.

The Government has several ongoing initiatives across sectors focused on growth. In agriculture the Government is aiming to reorient policy focus from being production-centric to becoming income-centric. The emphasis on incomes provides a broader scope towards achieving the needed expansion of the sector.

The proposed Industrial Policy 2018 provides an overarching, sector-agnostic agenda for the enterprises of the future and envisions creating a globally competitive Indian industry that is modern, sustainable and inclusive.

The Champion Services sector initiative is also under way to accelerate the expansion of select service sectors. The Working Group has accounted for these initiatives and encourages a fresh impetus to achieve the target of a five trillion economy.

28. Consider the following statements: [I.A.S. (Pre) 1996]

Most international agencies which fund development programmes in India on intergovernmental bilateral agreements, mainly provide:

1. Technical assistance

2. Soft loans which are required to be paid back with interest

3. Grants, not required to be paid back

4. Food assistance to alleviate poverty

Correct Answer: (b) 1, 2 and 3 are correct
Solution:Assistance based on agreements between international agencies and Govt. of India is primarily related to development. The help that India receives from these agencies (such as World Bank, ADB etc.) is both short term and long term, in which technical help, low interest rate loan and grants are included. Food assistance to alleviate poverty is not included in inter-governmental bilateral agreements.

29. Loan and grants, for the improvement of infrastructure of States in India have been given by which one of the following institution? [U.P. Lower Sub. (Pre) 2002]

Correct Answer: (a) World Bank
Solution:The 'Aid-India Consortium' was organized in 1958 as an international scheme to support the economic development of India, and led by the World Bank. This later came to be known as the 'Indian Development Forum'. The World Bank provides long term loans for the improvement of infrastructure (like construction of road, water and irrigation etc.) of States in India.
  • The WB is an international financial institution that provides loans and grants to the governments of low and middle-income/developing countries for the purpose of pursuing capital projects.
  • It was established along with the IMF at the 1944 Bretton Woods Conference.
  • The WB is the collective name for the International Bank for Reconstruction and Development (IBRD) and International Development Association (IDA), two of five international organisations owned by the WB Group.

30. Indian Development Forum (IDF) was carller known as: [B.P.S.C. (Pre) 2008]

Correct Answer: (a) Aid lndia Consortium
Solution:The 'Aid-India Consortium' was organized in 1958 as an international scheme to support the economic development of India, and led by the World Bank. This later came to be known as the 'Indian Development Forum'. The World Bank provides long term loans for the improvement of infrastructure (like construction of road, water and irrigation etc.) of States in India.

The WB Group, which is the parent organisation of the WB, includes

  • IBRD: It provides loans, credits and grants.
  • IDA: It provides low or no-interest loans to low-income countries.
  • International Finance Corporation (IFC):It provides investment, advice and asset management to private companies and governments.
  • Multilateral Guarantee Agency (MIGA): It insures lenders and investors against political risk such as war.
  • International Centre for the Settlement of Investment Disputes (ICSID): It settles investment-disputes between investors and countries.