Indian Economy MCQs
Indian Economy Multiple Choice Questions (MCQs) for SSC, State and all One Day Examinations of India. Objective Questions on Indian Economy for competitive examinations.
1. Which Indian state is the top producer of large cardamom?
[A] Kerala
[B] Sikkim
[C] Assam
[D] Gujarat
Show Answer
Correct Answer: B [Sikkim]
Notes:
Sikkim produces about 80% of India’s large cardamom. It is grown mainly in the Himalayan region of Sikkim due to the favorable climate and altitude. Sikkim’s production reached approximately 5.591 thousand tonnes in 2025. The government initiative “Mero Alaichi, Mero Dhan” supports cardamom cultivation in Sikkim. Assam, Gujarat, and Kerala do not match Sikkim’s output in this crop.
2. Which tool is used for sterilization during foreign capital inflows to control inflation?
[A] Filtering undeclared foreign assets
[B] Selling government securities in the open market
[C] Imposing restrictions on foreign exchange trading
[D] Allowing currency to appreciate freely
Show Answer
Correct Answer: B [Selling government securities in the open market]
Notes:
Sterilization involves central banks selling government securities in the open market to absorb liquidity created by foreign capital inflows. The Reserve Bank of India uses open market operations for this purpose. By selling government securities, the central bank withdraws excess rupee liquidity from the banking system. This method helps limit the expansion of the money supply and manage inflationary pressures resulting from increased foreign exchange reserves.
3. Which country is the world’s largest exporter of tea in 2025?
[A] China
[B] India
[C] Sri Lanka
[D] Kenya
Show Answer
Correct Answer: A [China]
Notes:
In 2024–25, China led global tea exports by value with $1,739 million, holding nearly 45% share and surpassing Kenya and Sri Lanka. While Kenya leads in black tea by volume, China remains the largest exporter overall based on latest official data.
4. Consider the following statements regarding Exchange Earners’ Foreign Currency (EEFC) Accounts:
- They are opened with the Reserve Bank of India (RBI)
- They earn interest on deposits
- They need a minimum balance to be maintained by the account holder
- They are non-interest bearing current accounts opened with authorized dealer banks
Which of the above statements is / are correct?
[A] Only 1
[B] 1 and 2
[C] Only 4
[D] 2 and 3
Show Answer
Correct Answer: C [Only 4]
Notes:
EEFC accounts are non-interest bearing current accounts maintained by authorized dealer (Category-I) banks following RBI regulations. These do not earn interest and require no minimum balance. Such accounts are not held directly with RBI but through authorized dealers. Therefore, only statement 4 is correct as per current RBI rules.
5. Central Employment Guarantee Council overlooks the progress of which among the following scheme?
[A] MGNREGA
[B] Food for Works Programme
[C] National Rural Livelihood Mission
[D] All of them
Show Answer
Correct Answer: A [MGNREGA]
Notes:
Central Employment Guarantee Council was constituted under Section 10 of the Mahatma Gandhi National Rural Employment Guarantee Act (MGNREGA), 2005 to discharge the duties and functions under this act.
6. The mosquito fern or Azolla is one of the most important bio fertilizers. In association with which among the following Azolla acts as a biofertilizer?
[A] Bacteria
[B] Blue-green algae
[C] Fungus
[D] Green algae
Show Answer
Correct Answer: B [ Blue-green algae]
Notes:
Bio-fertilizers such as Rhizobium, Azotobacter, Azospirillum and blue green algae (BGA) have been in use a long time. Anabaena, a blue green alga in association with water fern Azolla contributes nitrogen and also enriches soils with organic matter.
7. Consider the following components related to the balance of payments (BoP):
- Balance of Trade
- Foreign Direct Investments
- Foreign Portfolio Investments
- Foreign Aid
- Foreign Tourist Expenditures
- Domestic Tourism Expenditures
Which of the above are included in the balance of payments?
[A] Only 1, 2 & 5
[B] Only 1, 2, 3, 4 & 5
[C] Only 2, 3, 4 & 5
[D] Only 1, 2, 3 & 5
Show Answer
Correct Answer: B [Only 1, 2, 3, 4 & 5]
Notes:
The Balance of Payments (BoP) records all economic transactions between residents and the rest of the world. Items 1 (Balance of Trade), 2 (Foreign Direct Investments), 3 (Foreign Portfolio Investments), 4 (Foreign Aid), and 5 (Foreign Tourist Expenditures) are included in BoP. Item 6 (Domestic Tourism Expenditures) involves only domestic money flow and is not recorded in BoP.
8. Which of the following bodies procures, distributes, exports and imports agricultural commodities?
[A] FCI
[B] NAFED
[C] NABARD
[D] All of them
Show Answer
Correct Answer: B [ NAFED ]
Notes:
NAFED is the apex body in cooperative sector and deals in procurement , distribution, export and import of selected agricultural commodities.
9. Which of the following is / are auctioned in Open Market Operations?
[A] Shares
[B] Debentures
[C] Securities
[D] Bullion
Show Answer
Correct Answer: C [ Securities ]
Notes:
Open Market Operations refer to the purchase and sale of the Government securities (G-Secs) by RBI from / to market.
10. When will the full Mumbai-Ahmedabad bullet train corridor be operational?
[A] 2026
[B] 2027
[C] 2029
[D] 2030
Show Answer
Correct Answer: C [2029]
Notes:
The Mumbai-Ahmedabad High-Speed Rail corridor is a 508-kilometer project using Japan’s Shinkansen technology, featuring 12 stations across Maharashtra, Gujarat, and Dadra and Nagar Haveli. The National High Speed Rail Corporation Ltd. manages the project. As per official schedules, phased operations begin in 2027, with full end-to-end corridor operations targeted for 2029.
