Previous Year UPSC Questions

Explanation

Interest Coverage Ratio is a financial metric used to assess a company’s ability to meet its interest obligations on its debt. It’s calculated as:

Interest Coverage Ratio = Earnings Before Interest and Taxes (EBIT) / Interest Expense Statements 1 and 2 are correct: The interest coverage ratio is a debt and profitability ratio used to determine how easily a company can pay interest on its outstanding debt. Banks use the ICR to assess the current financial health of a firm. A low ICR suggests the firm may face difficulties repaying interest on its loans, posing a higher risk to lenders. ICR trends can help banks foresee emerging risks. A declining ICR signals worsening financial health, hinting at future repayment challenges.

Statement 3 is incorrect: A higher ICR implies that the firm generates sufficient earnings to cover its interest expenses comfortably, which is favorable. Conversely, a low ICR indicates a firm’s weakened ability to service its debt.

Explanation

Expansionary Monetary Policy is also known as Ac-commodative Monetary Policy has its main objective to increase the money supply in the economy through several measures such as:

Lowering interest rates.

Reducing reserve requirements for banks.

Purchasing government securities by RBI The goal of expansionary policy is to stimulate economic growth by encouraging business activities and consumer spending, while also helping reduce unemployment.

Statement 1 is incorrect: Statutory Liquidity Ratio (SLR) is the percentage of a bank’s net demand and time liabilities that must be maintained in the form of liquid assets, such as cash, gold, or government securities. Reducing the SLR allows banks to have more funds available for lending, thereby increasing the money supply in the economy. Hence RBI would cut and optimise the Statutory Liquidity Ratio.

Statement 2 is correct: Marginal Standing Facility (MSF) Rate is the rate at which banks can borrow overnight funds from the RBI against approved government securities. Increasing the MSF rate makes borrowing from the RBI more expensive for banks, which could discourage lending and contract the money supply. Thus raising the MSF rate is contrary to expansionary policy goals.

Statement 3 is incorrect: Bank Rate is the rate at which the RBI lends to commercial banks without any collateral. Repo Rate is rate at which the RBI lends to commercial banks against government securities. Lowering these rates reduces the cost of borrowing for banks, encouraging them to lend more to businesses and consumers, thereby increasing the money supply. Hence, cutting the Bank Rate and Repo Rate is consistent with an expansionary monetary policy.

Explanation

Statement 1 is correct: The objective of the scheme is to enable MPs to recommend works of developmental nature with emphasis on the creation of durable community assets based on the locally felt needs to be taken up in their Constituencies.

Statement 2 is correct: M.Ps are to recommend every year, works costing at least 15% of the MPLADS entitlement for the year for areas inhabited by Scheduled Caste population and 7.5% for areas inhabited by S.T. population.

Statement 3 is incorrect: The released funds under the MPLAD scheme are non-lapsable i.e. if the money is not utilised, it gets carried to the next year subject to the fulfillment of certain criterion.

Statement 4 is correct: The district authority should visit and inspect at least 10% of the works every year. It is also expected to involve the MPs in such activities.

Explanation

Rural co-operatives include District Central Cooperative Banks (DCCBs), State Co-operative Banks (StCBs), and Primary Agricultural Credit Societies (PACS).

Statement 1 is incorrect: Although the focus of rural cooperative lending is agriculture, the share in credit flow to the agriculture of rural cooperatives is only 12.1%, as compared to 76% of Scheduled Commercial Banks (SCBs), and 11.9% of Regional Rural Banks.

Statement 2 is correct: A District Co-operative Central Bank (DCCB) is a cooperative bank operating at the district level in various parts of India. It was established to provide banking to the rural hinterland for the agricultural sector with the branches primarily established in rural and semi-urban areas. DCCBs mobilise deposits from the public and provide credit to the public and PACS.

Explanation

Statement 1 is incorrect: The Indian Constitution under article 173(a) lays down the following qualifications for a person to be chosen as a member of the state legislature, such as - He must be a citizen of India. He must take an oath or affirmation before the person the Election Commission has designated for this purpose. He must be not less than 30 years of age in the case of the legislative council and not less than 25 years of age in the case of the legislative assembly. while a one becomes voter at the age of 18. He must possess other qualifications prescribed by Parliament.

Statement 2 is incorrect: As per Section 8 of the Representation of the People Act (RPA), 1951, a person convicted of an offense and sentenced to imprisonment for two years or more will be disqualified from the date of conviction. This disqualification remains in effect for six additional years after their release. Hence, the disqualification is not permanent.

Explanation

Statement 1 is correct: As per Article 85(1), the Constitution gives the power to the President to summon a session of Parliament to meet at such a place as he/she thinks fit. The gap between two sessions must not exceed 6 months.

Statement 2 is incorrect: By convention, Parliament meets for three sessions in a year. However the Constitution does not stipulate it. Article 85(1) of the Indian Constitution states "The President shall from time to time summon each House of Parliament to meet, and six months shall not intervene between its last sitting in one session and the date appointed for its first sitting in the next session." This means that according to the Constitution of India, Parliament must meet at least once every six months, but the number of sessions is not fixed.

Statement 3 is correct: There is no provision about the minimum number of days that the Parliament is required to meet in a year.

Explanation

Option (b) is correct: The Rajya Sabha enjoys equal powers with Lok Sabha in matters like - The impeachment of the President, Removal of the vice-president, Constitutional amendments, and Removal of the judges of the Supreme Court and the High Courts.

Option (a), (c) and (d) are incorrect:

Rajya Sabha enjoys exclusive powers in the matter of creating new All India Services. In the matter of removal of government, Rajya Sabha has unequal status with respect to Lok Sabha. The Council of Ministers is responsible only to Lok Sabha and not to the Rajya Sabha. Thus, a no-confidence motion cannot be introduced in the Rajya Sabha. Rajya Sabha has less or no powers in the matters of finance like making cut motions, passing money bill, etc. vis-a-vis Lok Sabha.

Explanation

Central Ground Water Board monitors groundwater levels throughout the country on a regional scale, four times in a year during the months of March/April/May, August, November and January. For monitoring of ground water level, CGWB has a dedicated network of about over 30000 monitoring stations called "National Hydrograph Network Stations (NHNS)", which comprises open dug wells and purpose built bore/tube wells for water level monitoring called piezometers.

Statement 1 is incorrect: 256 of our approximately 700 districts have groundwater levels which are "critical" or "overexploited" as per the latest data from the Central Ground Water Board (2017). As per the report ‘National Compilation on Dynamic Groundwater Resources of India, 2017 out of the total 6881 assessment units (Blocks/Mandals/ Talukas) in the country, 1186 units in various States (17%) have been categorized as ‘Over-Exploited’, 313 units (5%) are ‘Critical’. This adds to 22%.

Statement 2 is correct: The Central Ground Water Authority (CGWA), established under Section 3(3) of the Environment (Protection) Act, 1986. It operates under the Ministry of Jal Shakti, Government of India. Its primary mandate is to regulate and control the development and management of groundwater resources across the country.

Statement 3 is correct: FAO research paper shows the countries with the largest extent of areas equipped for irrigation with groundwater, in absolute terms, are India (39 million ha), China (19 million ha) and the USA (17 million ha).

Explanation

The Fiscal Responsibility and Budget Management (FRBM) Act, 2003 aims to ensure fiscal discipline in India by setting targets for government borrowing, fiscal deficits, and public debt. Its objective is to reduce the fiscal deficit and maintain macroeconomic stability. As per the act the Central Government is required to lay before both Houses of Parliament the following fiscal policy statements every financial year, alongside the annual financial statement and demands for grants:

Medium-term Fiscal Policy Statement Fiscal Policy Strategy Statement Macroeconomic Framework Statement

Explanation

A drone, technologically, is an unmanned aircraft.

They are formally known as unmanned aerial vehicles (UAVs). A drone is essentially a flying robot that can be remotely piloted or can fly on its own using software-controlled flight plans in embedded systems in conjunction with onboard sensors and GPS.

Statement 1 is correct: Modern agriculture has increasingly adopted drones for the application of pesticides and fertilizers. These drones offer precision in spraying, ensuring uniform coverage and reducing the exposure of farmers to harmful chemicals. For instance, a study published in Springer highlights that drones equipped with advanced sensors and high-resolution cameras can distinguish between healthy and infested crops, allowing for targeted pesticide application.

Statement 2 is correct: Drones equipped with visual and thermal cameras are utilized in geological studies to inspect active volcano craters. They can safely approach hazardous areas, capturing high-resolution images and collecting gas samples. Researchers from the German Research Centre for Geosciences (GFZ) successfully employed drones to study the active Santa Maria volcano in Guatemala.

Statement 3 is correct: Marine biologists have innovated methods to collect biological samples from whales using drones. By flying drones through the spouts of whales, researchers can gather respiratory droplets containing DNA, hormones, and microorganisms without disturbing the animals. This technique was employed in the Ocean Alliance’s SnotBot program.