International Trade (Part – III)

Total Questions: 50

31. Consider the following statements: [I.A.S. (Pre) 2003]

1. India's import of crude and petroleum products during the year 2001-02 accounted for about 27% of India's total imports.

2. During the year 2001-02, India's exports had increased by 10% as compared to the previous year.

Which of these statements is/are correct?

(a) Only 1
(b) Only 2
(c) Both 1 and 2
(d) Neither 1 nor 2

Correct Answer: (a) Only 1

Solution:India's import of crude and petroleum products during the year 2001-02 accounted for about 27.2% of India's total imports. In comparison to previous year India's export growth rate was negative (-1.6%) in 2001-02. Hence, option (a) was the correct answer. According to Ministry of Commerce and Industry, Government of India, share of petroleum, crude products in total imports is at 26.52% in 2023-24 (P) and 29.4% in 2022-23.

32. Consider the following items imported by India: [I.A.S. (Pre) 1996]

1. Capital goods

2. Petroleum

3. Pearls and precious stones

4. Chemicals

5. Iron and Steel

The correct sequence of the decreasing order of these items (as per 94-95 figures), in terms of value is:

(a) 1, 2, 3, 4, 5
(b) 1, 2, 4, 3, 5
(c) 2, 1 ,3, 4, 5
(d) 2,1, 4, 5, 3

Correct Answer: (c) 2, 1 ,3, 4, 5

Solution:As per the question period, sequence given in option (c) was the correct answer. According to the Economic Survey 2022- d choose your answer with 23, import values (in Rs. cr.) of these items in recent years are as follows:

Items	Import value (Rs. cr.) 2020-21	Import value (Rs. cr.) 2021-22
Capital goods	406644	510074
Petroleum (POL)	611353	1207803
Pearls, precious and semiprecious stones	139024	231279
Chemical elements and compounds	209326	308882
Iron & Steel	61288	94053

33. The biggest LNG supplier to India is: [U.P.P.C.S. (Mains) 2011]

(a) Iran
(b) Kuwait
(c) Qatar
(d) Saudi Arabia

Correct Answer: (c) Qatar

Solution:Qatar is the largest liquefied natural gas (LNG) supplier to India. India imports LNG mainly from Qatar and some other countries through long-term agreements and also takes steps to diversify its own natural gas resources. As per the Statistical Review of World Energy 2023, India imported 28.4 billion cubic metres (bcm) of LNG in 2022, with Qatar (14.7bcm), UAE (3.8 bcm), USA (3.3 bcm), Nigeria and Oman (1.3 bcm each) being the top suppliers.

34. The term 'West Texas Intermediate', sometimes found in news, refers to a grade of: [I.A.S. (Pre) 2020]

(a) Crude oil
(b) Bullion
(c) Rare earth elements
(d) Uranium

Correct Answer: (a) Crude oil

Solution:'West Texas Intermediate' (WTI) refers to a grade of crude oil. It is a specific grade of crude oil and one of the three major oil benchmarks used in trading, along with Brent and Dubai crude.

35. Goods imported at Haldia Port is: [U.P.P.C.S (Pre) 1992]

(a) Fish
(b) Heavy Machinery tools
(c) Steel
(d) Petroleum products

Correct Answer: (c) Steel

Solution:The Port of Haldia is a major port and industrial city in West Bengal. The main goods imported at Port of Haldia are: fertilizers, foodgrains, sugar, paper and newsprint, coking coal, petroleum and metallurgical coke, soda ash, iron and steel, limestone, machinery, scrap, vegetables, and general cargoes.

36. Import procedure begins with: [U.P.P.C.S (Pre) 2011, U.P.P.C.S. (Mains) 2011]

(a) Indent
(b) Mate's receipt
(c) Marine insurance
(d) Shipping bill

Correct Answer: (a) Indent

Solution:After the initial formalities are over and the importer has obtained the necessary amount of foreign exchange for im- port (through the Letter of credit), the next step in the import of goods is that of placing the order. This order is known as Indent and import process begins with it.

37. A Letter of Credit has to be produced by: [U.P.P.C.S (Pre) 2011]

(a) An exporter
(b) An importer
(c) Custom authorities
(d) Shipping company

Correct Answer: (b) An importer

Solution:A Letter of Credit (L/C) is a written undertaking by the importer's bank, known as the Issuing Bank, on behalf of its customer, the Importer (Applicant), promising to effect payment in favour of the Exporter (Beneficiary) up to a stated sum of money, within a prescribed time limit and against stipulated documents. After the trading parties agree on a sale of goods, the Importer requests that its bank (the Issuing Bank) issue a Letter of Credit in favour of the Exporter.

38. A 'Letter of Credit' is produced by: [U.P.P.C.S. (Mains) 2009, U.P. Lower Sub. (Pre) 2013]

(a) An exporter
(b) An importer
(c) Both by exporter and importer
(d) Shipping company

Correct Answer: (b) An importer

39. Which of the following items had the largest share in India's export in the year 2004-05? [U.P.P.C.S. (Pre) 2006]

(a) Agricultural and allied products
(b) Ores and Minerals
(c) Manufactured Goods
(d) Petroleum Products

Correct Answer: (c) Manufactured Goods

Solution:As per the question period as well as at present, manufactured goods have the largest share in total exports of India. According to the Economic Survey 2022-23, percentage share of major exports is as follows:

Commodity Group	2020-21	2021-22	2022-23 (P) (Apr.-Sep.)
Manufactured Goods	71.2	67.8	58.9
Crude & Petroleum Products (incl. Coal)	9.2	16.4	22.7
Agriculture & allied products	14.3	11.9	11.6
Ores and Minerals	3.2	2.0	1.5

Note: Economic Survey 2023-24 is not released till end-June, 2024.

40. The table given below depicts the composition of India's exports between 1992-93 and 1994-95: [I.A.S. (Pre) 1996]

The changing composition of the export trade is indicative of structural transformation of Indian economy in favour of modernization. The best indicator of this trend is the:

Items	1992-93	1993-94	1994-95
(a) Agriculture and allied products	16.9	18.0	15.9
(b) Ores & Minerals	4.0	4.0	3.7
(c) Manufactured goods	75.5	75.6	78.0
(d) Petroleum product	2.6	1.8	1.9

(a) relative share of petrolem products in exports
(b) decline in the share of agricultural products in exports
(c) constant share of ores and minerals in exports
(d) increase in the share of manufactured products in exports

Correct Answer: (d) increase in the share of manufactured products in exports

Solution:The increase in the share of manufactured products in exports indicates that the economy is going towards modernization because in the beginning stage of development an economy generally export agricultural goods, and import manufactured products. The increase of industrial production and exports of manufactured products is indicative of structural transformation of Indian economy in favour of modernization.

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