Indian Economy - General awareness questions on current affairs

1)   Which economy will be the fastest growing among G-20 nations, as per Moodys?
- Published on 24 Feb 17

a. Japan
b. UK
c. China
d. India
Answer  Explanation  Related Ques


Moody has predicted India will be the fastest growing economy among G-20 countries clocking a 7.1 per cent growth in 2017.

The Indian economy had slowed in the fourth quarter of 2016 due to the withdrawal of 86 per cent of the currency in circulation, without an immediate replacement.

India is forecast to have the fastest growing economy among all G-20 countries with growth put at 7.1 per cent for 2017, down from a previous expectation of 7.5 per cent because of the effects of demonetisation.

With regard to global growth, Moody's said continuing cyclical recovery in global economic activity with growth in G-20 countries picking up modestly to 3 per cent in 2017 and 2018 from 2.6 per cent in 2016.

The potential shifts in US policy add uncertainty to this forecast.

There is unusually high uncertainty around our global forecasts due to the wide range of outcomes that could arise from significant shifts in US policy on a number of domestic and international issues, including trade and immigration.

The systemic risks to this forecast may stem from shifts in US trade policies, risks to global financial markets and emerging market economies if American interest rates were to rise faster than anticipated and/or the US dollar were to appreciate sharply.

Also there could be risks of a sudden and sharp deceleration in China and political and fragmentation risks in the EU and the euro area, Moody's indicated.

In the report titled 'Modest Acceleration in the Global Economy, but Shifting US Policies Inject Uncertainty', Moody's said there is a high risk of a significant protectionist shift in US trade policy and could inflict lasting damage to the global economy.

Regarding Asia, Moody's said China's economy stabilised around the official growth target of 6.7 per cent in 2016. It will likely continue to decelerate to 6.3 per cent and 6 per cent in 2017 and 2018.

Moody's expects that the US economy will get additional lift from a stimulative fiscal policy stance pushing growth above potential.

Accordingly, Moody's has revised its real GDP growth forecast to 2.4 per cent in 2017 and 2.5 per cent in 2018, from 2.2 per cent and 2.1 per cent, respectively.

Moody's forecast assumes the US Federal Reserve will raise the federal funds rate by 75-100 basis points in three to four rate hikes in 2017.

US Federal Reserve: Know More

  • Chairperson: Janet Yellen
  • Founder: United States Congress
  • Founded: 23 December 1913
  • Headquarters: Washington, D.C.
  • Central bank of: United States of America

2)   SBI Research has pegged Q3 GDP of India at _______
- Published on 23 Feb 17

a. 5.7%
b. 5.8%
c. 5.9%
d. 6%
Answer  Explanation  Related Ques

ANSWER: 5.8%

The economy would have grown under-6 per cent in the third quarter, destroyed by the note ban, according to SBI Research.

The government will release the December quarter GDP print on February 28.

SBI research holds GDP growth to be decisively lower than 6 per cent in Q3 at 5.8 per cent and 6.4 per cent in Q4.

Overall, the estimate for H2 is 6.1 per cent with a downward bias against CSO's 7 per cent and the fiscal 2017 growth at 6.6 per cent.

In the next year growth could move up faster if demand comes back faster post-remonetisation, it added.

The report said growth will be pulled down by the poor show by sectors like construction, real estate, cement and FMCG, which are likely to witness a decline in sales in Q3 and will recover thereafter.

With the CSO (Central Statistics Organisation) estimate of 7.1 per cent for fiscal 2017, the Q3 and Q4 GDP growth would be around 6.1 per cent and 7.8 per cent.

This is improbable given the extent of liquidity shock that has led to a drastic consumer spending shock.

The 7.1 per cent GDP estimate by CSO implies a 7.8 per cent GDP growth in Q4, which looks highly unlikely.

As per the CSO, GDP is likely to grow by 7.1 per cent in fiscal 2017 compared to 7.9 per cent a year ago.

RBI, on the other hand, estimated GVA growth at 6.9 per cent as against its earlier estimate of 7.6 per cent. Of this 70 bps reduction, 35 bps are attributed to demonetisation and the rest to base effect.

CSO: Know More

  • The Central Statistics Organisation (CSO) of India is responsible for co-ordination of statistical activities in India.
  • It also oversees evolving and maintaining statistical standards.
  • It has a well-equipped Graphical Unit.
  • The CSO is located in Delhi.
  • Some portion of Industrial Statistics work pertaining to Annual Survey of industries is carried out in Calcutta.

3)   IMF has pegged Indian GDP at which figure post demonetisation?
- Published on 23 Feb 17

a. 6.5%
b. 6.6%
c. 6.7%
d. 6.8%
Answer  Explanation  Related Ques

ANSWER: 6.6%

IMF says India's growth is projected to slow to 6.6 per cent in 2016-17 fiscal due to the strains that have emerged in the economy as a result of "temporary disruptions" caused by demonetisation.

In its annual report, however, the International Monetary Fund (IMF) said demonetisation would have only short term impact on the economy and it would bounce back to its expected growth of more than eight per cent in the next few years.

The post-November 8, 2016 cash shortages and payment disruptions caused by the currency exchange initiative have undermined consumption and business activity, posing a new challenge to sustaining the growth momentum.

Growth is projected to slow to 6.6 per cent in FY2016/17, then rebound to 7.2 per cent in FY2017/18, due to temporary disruptions, primarily to private consumption, caused by cash shortages.

India's economy grew at 7.6 per cent in 2015-16 due to a favourable monsoon, low oil prices and continued progress in resolving supply-side bottlenecks, as well as robust consumer confidence.

The investment recovery is expected to remain modest and uneven across sectors, as deleveraging takes place and industrial capacity utilization picks up, the report said.

IMF Directors supported the Indian efforts to clamp down on illicit financial flows, but noted "the strains that have emerged" from the currency exchange initiative.

IMF EDs commended New Delhi for its strong policy actions, including continued fiscal consolidation and an anti-inflationary monetary policy, which have underpinned macroeconomic stability.

As such, the IMF recommended continued vigilance to potential domestic and external shocks and urged the authorities to further advance economic and structural reforms to address supply bottlenecks, raise potential output, create jobs, and ensure inclusive growth.

All About the IMF

  • Headquarters: Washington, D.C., United States
  • CEO: Christine Lagarde (since 2011)
  • Founded: 27 December 1945, Bretton Woods, New Hampshire, United States
  • Leader: Christine Lagarde
  • Staff: 2700
  • Founders: John Maynard Keynes, Harry Dexter White
  • Parent organization: United Nations

4)   To promote a cashless economy, government is developing __________
- Published on 22 Feb 17

a. Digital matrix to evaluate states for cashless economy
b. Online platform for regulating cashless payments
c. Mobile app for regulating online transactions
d. All of the above
Answer  Explanation 

ANSWER: Digital matrix to evaluate states for cashless economy

Amitabh Kant, Chief Executive Officer of the government's policy think-tank NITI Aayog, said on 21st Feb 2017 that the government is developing a digital matrix.

The matrix to evaluate states in the push for a less-cash economy.

States are playing a critical role in getting citizens to opt for digital payments.

Stating that the government was taking steps to promote digital payments and bring digital on par with cash, Kant said that the Budget had announced a number of incentives including cash back and referral bonuses.

Kant said the government was also pushing for an Aadhaar app and a reduction in the Merchant Discount Rate.

RBI had proposed to drastically cut MDR charges on debit card payments from April 1 with a view to maintain momentum of digital transactions post note ban, especially among small merchants.

Kant said the ultimate aim was to enable to market to take over and drive the digital payment movement in a big way.

Continuing the digital push, the Reserve Bank of India had on 20th Feb 2017 launched the BharatQR platform.

This is a platform where scanning a QR code through a mobile phone will allow a customer to transfer money from one source to another.

5)   Which state released a digital roadmap?
- Published on 22 Feb 17

a. Punjab
b. Haryana
c. Delhi
d. None of the above
Answer  Explanation 

ANSWER: Haryana

Digital Haryana Roadmap will promote increased use of IT tools in the state and aid in a hassle-free delivery of citizen-centric services.

The Chief Minister, who was presiding over a meeting of CM Digital Haryana Cell here, said that not just delivery of services, but also the working of offices would undergo a complete change.

This is under the Digital Haryana Roadmap 2017-19.

The roadmap has been designed to convert governance into "Saral Shashan" which has been defined as "simple, all-inclusive, real-time, action-oriented and long lasting governance."

Under this, all departments where Information Technology-related projects are being implemented, would be connected.

The coordination would be established among them for proper monitoring of projects and policies.

Emphasis would be laid on curbing corruption and promoting digital literacy.

Service delivery to citizens would include immunisation updates through voice bursts, online calls with doctors, direct scholarship debit to bank accounts, real-time attendance updates to parents through SMS.

Other services include information on local voter registration via SMS, new service updates through Atal Seva Kendras, auto authentication for marriage registration and online registration of new apartments.

The government offices would be transformed to facilitate, among other things, daily feedback on school enrolment and bulk SMS to parents of children to improve attendance in schools.

It will also be promoting paperless governance.

Playing the enablers for various IT initiatives facilitating transformation across the state will be Atal Seva Kendras, online mobiles, and government offices.

Digital Haryana Roadmap 2017-19 was reaffirmation of the state government's resolute resolve to serve the people well.

It will make life easy by 'cutting down interface between the people and the administration' through increased use of IT tools.

185 IT projects are being implemented or are under process of implementation in the state, of which ten per cent are being implemented by the Central Government.

20 per cent projects have budget provision of more than Rs one crore, 50 per cent projects were launched in the last two years, and 70 per cent are being implemented through government agencies.


  • Area: 44,212 km²
  • Capital: Chandigarh
  • Population: 27.76 million (2016)
  • Chief minister: Manohar Lal Khattar

6)   What is Momentum Jharkhand?
- Published on 20 Feb 17

a. Scheme
b. Social welfare programme
c. Global investors summit
d. None of the above
Answer  Explanation 

ANSWER: Global investors summit

Around 209 MoUs were signed between different companies at the Momentum Jharkhand, a two-day global investors summit held in Ranchi, state capital.

Due to these MoUs, investment worth 3 lakhs, 39 thousands and 87 crores rupees will come in the state.

These investments will create direct job for two lakhs nine thousands and 176 people while indirectly create about four lakhs employment opportunities.

Out of total 209, the maximum numbers of MoUs were signed in mining sector which is 121. It was followed by IT and e-governance, with 30 MoUs while Urban development and housing with 17 MoUs.

Jharkhand: Know More

  • Founded: 15 November 2000
  • Area: 79,714 km²
  • Capital: Ranchi
  • Population: 31.9 million (2012)

7)   India ranked at which position in the Index of Economic Freedom?
- Published on 20 Feb 17

a. 142
b. 143
c. 144
d. 145
Answer  Explanation 


India has ranked a dismal 143rd in an annual index of economic freedom by a top American think-tank, behind its several South Asian neighbours including Pakistan.

The progress on market-oriented reforms has been “uneven” as per the index.

The Heritage Foundation in its Index of Economic Freedom report said despite India sustaining an average annual growth of about 7 per cent over the past five years, growth is not deeply rooted in policies that preserve economic freedom.

Putting India in the category of “mostly unfree” economies, the conservative political think-tank said progress on market-oriented reforms has been “uneven”.

Also, India’s overall score of 52.6 points is 3.6 points less than that of last year, when India was ranked 123rd.

Hong Kong, Singapore and New Zealand topped the index.

Among South Asian countries, only Afghanistan (163) and Maldives (157) were ranked below India. Nepal (125), Sri Lanka (112), Pakistan (141), Bhutan (107), and Bangladesh (128) surpassed India in economic freedom.

The think-tank, however, credited Prime Minister Narendra Modi with “reinvigorating” India’s foreign policy

India is a significant force in world trade, the report noted, but corruption, underdeveloped infrastructure, and poor management of public finance undermine overall development.

China with a score of 57.4 points - an increase of 5.4 points compared to previous year - was placed at 111 position. The United States was ranked 17 with 75.1 points.

The world average score of 60.9 is the highest recorded in the 23-year history of the index. Forty-nine countries - the majority of which are developing countries, but also including countries such as Norway and Sweden - achieved their highest-ever index scores.

8)   Banks need how much capital to sustain 8-9% growth?
- Published on 16 Feb 17

a. INR 90,000 crore
b. INR 91,000 crore
c. INR 92,000 crore
d. INR 93,000 crore
Answer  Explanation 

ANSWER: INR 91,000 crore

Indian banks will require INR 91,000 crore in tier-1 capital till March 2019 to sustain a minimum annual growth rate of 8-9 percent, according to a report by India Ratings and Research (Ind-Ra).

This includes INR 20,000 crore of residual tranches from the government's capital infusion in public sector banks under the under 'Indradhanush' programme.

There is an increasing divide between the large and smaller PSBs, with the former having some access to growth capital, better market valuation, and also some non-core assets to divest.

The latter would only receive bailout capital if required.

The long tail of credit costs is expected to subdue profitability of domestic banks despite plateauing their stressed assets.

Ind-Ra has maintained a stable rating and sector outlook on private sector banks and large PSBs while it has retained the negative sector outlook for small, mid-sized state-owned banks for 2017-18.

It expects large PSBs with better access to capital and private sector banks with their robust capitalisation to navigate another year of low growth and rising credit costs with a stable outlook.

The agency had retained its negative outlook on mid-sized and smaller PSBs with weak capitalisation and large stock of ageing non-performing loans (NPLs).

These banks will find it increasingly difficult to grow given increasing capital requirements and large funding gaps impeding their ability to compete on spreads as per Ind-Ra.

According to Ind-Ra's sector-wise stress analysis, sectors such as iron and steel and textiles have seen recognition but provisioning might still not be enough to protect against eventual loss given defaults.

Significant proportion of unrecognised stress pertains to sectors such as infrastructure, realty and capital goods which potentially have long-term viable assets.

These would increasingly need cash flow restructuring to avoid slippages.

NPLs: Know More

  • A nonperforming loan (NPL) refers to a sum of borrowed money upon which the debtor has not made his scheduled payments for at least 90 days.
  • A nonperforming loan is either in default/close to being in default.
  • Once a loan is nonperforming, the odds that it will be repaid in full are considered to be low.

9)   Which of the following became the first cashless township in India?
- Published on 15 Feb 17

c. Both of the above
d. None of the above
Answer  Explanation 


Gujarat Narmada Valley Fertilizers (GNFC) township, the state owned company’s township at Bharuch, is 100% cashless and probably the first such township in India.

It has a population of around 5,000 and floating population of around 10,000 every day.

It has facilities like a big shopping centre, restaurants, eateries, schools and colleges, hospital, stadium, guest house, etc.

The GNFC township shall be launched by Gujarat chief minister Vijay Rupani on February 13 at Bharuch.

The GNFC is the first integrated industrial township in the country to go 100% digital in all financial transactions.

All the shops in the Gujarat Narmada Valley Fertilizers township, which include paan shops, laundries, vegetable shops, barber shops, provision stores, cycle repairing shops, flour mills, conduct their business only through cashless transactions.

Transactions are done using PoS machines, e-wallets like BHIM, UPI, SBI Buddy, etc.

10)   Indian economy, according to India Ratings and Research, will grow at __ in the next fiscal.
- Published on 15 Feb 17

a. 7.2%
b. 7.3%
c. 7.4%
d. 7.5%
Answer  Explanation 

ANSWER: 7.4%

The Indian economy is likely to grow by 7.4% in the next fiscal, according t India Ratings and Research.

GDP growth estimate for 2016-2017 has been revised from 6.8 to 7.9 percent, lower than the CSO advanced estimate of 7.1%.

Gross value added of three production sectors, namely agriculture, industry and services would grow at 3%, 6.1% and 9.1% Y-O-Y in this fiscal.

The current account deficit will come at 1% of the GDP in 2017-2018 as against 0.9 percent in 2016-2017.

This will help the rupee trade at an average 69.18/USD in FY18.

India is likely to face continued headwinds on the exports front due to the play out of Brexit and the anti-globalisation stance of US President Donald Trump and imports are unlikely to pick up so long as the domestic investment cycle does not revive.

As against the popular perception, Ind-Ra said the main setback to investment growth came from the negative 2.2 percent growth in the gross fixed capital formation (GFCF) of household sector.

Ind-Ra expects GFCF to grow at 4.9 percent in 2017-18.

India's economic growth forecast of 7.4 percent by Ind-Ra in 2017-18 is on the upper end of the 6.75 to 7.5 percent band estimated in the Economic Survey.

Ind-Ra: Know More

  • India Ratings & Research (India Ratings) is a rating agency committed to providing the India's credit markets with accurate, timely and prospective credit opinions.
  • India Ratings has grown rapidly during the past decade gaining significant market presence in India's fixed income market.
  • India Ratings is a wholly owned subsidiary of the Fitch Group.
  • India Ratings currently maintains coverage of corporate issuers, financial institutions.
  • India Ratings is headquartered in Mumbai and has six branch offices located at Ahmedabad, Bengaluru, Chennai, Delhi, Hyderabad and Kolkata.
  • India Ratings is recognised by the Securities and Exchange Board of India, the Reserve Bank of India and NHB.

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