Test: Economic Development MCQs (June 2024 Current Affairs) - UPSC MCQ

- Statement-I is incorrect. The ODA has not been increasing for two consecutive years as stated. The text mentions that ODA has been decreasing, dropping to USD 164 billion in 2022.
- Statement-II is correct based on the information provided. The proportion of aid given as loans has indeed been increasing, rising from 28% in 2012 to 34% in 2022.

The Global Economic Prospects Report 2024 anticipates that for the fiscal years 2026 and 2027, global GDP growth is expected to be 2.7%. This projection comes amidst expectations of modest growth in trade and investment, indicating a cautious optimism regarding the global economic outlook for those years.

Statement 1: Yes, Africa's debt burden has grown faster than its economy, leading to a rise in the debt-to-GDP ratio:

• Debt-to-GDP ratio

  The debt-to-GDP ratio is the ratio between a country's government debt and its gross domestic product (GDP). A higher debt-to-GDP ratio means it's less likely a country will pay back its debt and more likely it will default. Default could cause financial panic in domestic and international markets.

• Debt burden

  Africa's debt has increased by 183% since 2010, which is about four times higher than its GDP growth rate. In 2021, Africa's external debt reached $824 billion, and in 2022, public debt reached $1.8 trillion. The average debt-to-GDP ratio for the continent is projected to rise to 63.5% in 2023.

Statement 2: The number of African countries with debt-to-GDP ratios above 60% has decreased between 2013 and 2023.

• This statement suggests that there has been a reduction in the number of African countries with high debt-to-GDP ratios over the specified period.

Hence, the correct answer is: Statement-I is correct, but Statement-II is incorrect

The report emphasizes that higher interest rates, necessary to control inflation, can lead to slower economic growth and job losses as investors become less willing to take risks, resulting in stock market volatility. This can have significant implications on investment patterns and economic stability.

1. Correctly matched. The current process of exchanging claims lacks standardization across the ecosystem.
2. Correctly matched. Issues like discharge delays complicate the matter.
3. Correctly matched. Building trust among policyholders depends on efficient service delivery.
4. Incorrectly matched. High out-of-pocket expenses are not a direct challenge of implementing NHCX; rather, NHCX aims to reduce these expenses.

1. Correctly matched. The NHCX aims to enable patients to access quality healthcare quickly and reduce out-of-pocket expenses.
2. Incorrectly matched. In India, much of the claim processing is manual, unlike many developed markets where over 90% of claims are auto-adjudicated.
3. Correctly matched. The Digital Health Incentive Scheme (DHIS) provides financial incentives for hospitals per insurance claim transaction through the NHCX.
4. Correctly matched. The Health Claim Exchange Specification is an open standard-based communication protocol for the exchange of health claim information.

The South Asian Region is forecasted to experience a decline in growth rate from 6.6% in 2023 to 6.2% in 2024, primarily due to a slowdown in India's growth rates from previous years. This slowdown is significant for the region given India's substantial contribution to regional economic growth.

All the statements are correct. Setting up a new coal plant in India is indeed more expensive compared to setting up a solar power plant, with the cost of setting up a coal plant being Rs 8.34 crore per MW. Furthermore, solar capacity in India has doubled to 81 GW in the recent years, reflecting significant growth in renewable energy infrastructure.

Statement I: The RBI does include promoting Indian MNCs and global brands as part of its aspirational goals, as highlighted in the text. This statement is correct.

Statement II: Exchange rate volatility is indeed mentioned as a challenge faced by the RBI in the context of internationalizing the Indian Rupee. This statement is also correct.

Therefore, the correct answer is:

Option A: Both Statement I and Statement II are correct and Statement II explains Statement I.

Statement I: The statement accurately reflects the goal set by the Reserve Bank of India to position a few Indian banks among the top global banks, aiming to enhance India's financial standing internationally. This statement is correct.

Statement II: The Triffin Dilemma indeed describes the conflict between domestic monetary policy goals and the role of a country as an international reserve currency issuer. This statement is also correct.

Therefore, the correct answer is:

Option A: Both Statement I and Statement II are correct and Statement II explains Statement I.

Statement I: The RBI does indeed face cybersecurity threats concerning digital payment systems, as highlighted in the provided text. This statement is correct.

Statement II: The statement accurately points out that the internationalization of the Indian Rupee could potentially lead to increased demand for the currency, which might impact Indian exports. This statement is also correct.

Therefore, the correct answer is:

Option A: Both Statement I and Statement II are correct and Statement II explains Statement I.

Statements 1 and 3 are correct, while statement 2 is incorrect.

1. The PFMS indeed enables real-time tracking of duty drawback claims by exporters, providing transparency and efficiency in the process.

2. Contrary to what is stated, the electronic transfer of duty drawback funds by PFMS has reduced manual intervention in the refund process, not increased it.

3. Streamlining the refund process through PFMS ensures transparency and efficiency in customs operations by reducing processing time and eliminating manual intervention.

1. Correctly matched. NHCX will standardize and enable seamless exchange of health claims data.
2. Correctly matched. NHCX is expected to enable transparent and efficient claims processing, reducing operational costs.
3. Correctly matched. NHCX will bring uniform data presentation and centralized validation of claims, leading to standardized healthcare pricing.
4. Incorrectly matched. The statement about reduced hospitalization cases is not a benefit directly attributed to NHCX.

1. Digital Payments: PhonePe, Paytm - Correct. Both PhonePe and Paytm offer digital payment solutions.

2. Alternative Lending: Lending Club, GoFundMe - Incorrect. Lending Club is a marketplace lending platform, but GoFundMe is a crowdfunding platform, not strictly an alternative lending platform.

3. Insurance: Policybazaar, Digit Insurance - Correct. Both Policybazaar and Digit Insurance offer digital insurance solutions.

4. InvestmentTech: Zerodha, FidPay - Incorrect. Zerodha offers digital investment solutions, but FidPay is a Banking-as-a-Service Platform, not an investment tech platform.

All the statements are correct. The share of coal-fired power generation did indeed increase from 71% in FY2019-20 to 75% in FY2023-24. Additionally, the average plant load factor (PLF) for coal-fired thermal plants rose from 53% to 68% over the last five years, indicating improved efficiency and utilization. Lastly, the private sector's contribution to the total thermal capacity added in the last five years was only 1.7 GW, which is 7% of the total new capacity.