DAY – 45 (InstaTest-45): Insta 75 Days Revision Plan-2023: Topic – ECONOMY, Test – 31, June 2022 CA

Solution:  D

2022 UN Ocean Conference

UN ocean conference: ‘Blue Deal’ to enable sustainable use of ocean resources for economic development.

A “Blue Deal” is being promoted at the 2022 United Nations Ocean Conference to enable the sustainable use of ocean resources for economic growth.

It includes global trade, investment and innovation to create a sustainable and resilient ocean economy, according to the UN Conference on Trade and Development (UNCTAD).

Coastal and island developing nations can benefit from the sustainable development of the ocean economy, including fisheries and aquaculture, coastal tourism, maritime transport, offshore renewable energy, ecosystem services and marine genetic resources, UNCTAD stated.

Solution: C

NASA’s CAPSTONE revealed in lunar Sunrise: CAPSTONE will fly in cislunar space – the orbital space near and around the Moon. The mission will demonstrate an innovative spacecraft-to-spacecraft navigation solution at the Moon from a near rectilinear halo orbit slated for Artemis’ Gateway.

A microwave oven–sized CubeSat weighing just 55 pounds is the first spacecraft to test a unique, elliptical lunar orbit as part of the Cislunar Autonomous Positioning System Technology Operations and Navigation Experiment (CAPSTONE). As a pathfinder for Gateway, a Moon-orbiting outpost that is part of NASA’s Artemis program, CAPSTONE will help reduce risk for future spacecraft by validating innovative navigation technologies and verifying the dynamics of this halo-shaped orbit.

The orbit, formally known as a near rectilinear halo orbit (NRHO), is significantly elongated. Its location at a precise balance point in the gravities of Earth and the Moon, offers stability for long-term missions like Gateway and requires minimal energy to maintain.

Solution: A

What are mRNA vaccines and how do they work?

Vaccines help prevent infection by preparing the body to fight foreign invaders (such as bacteria, viruses, or other pathogens). All vaccines introduce into the body a harmless piece of a particular bacteria or virus, triggering an immune response. Most vaccines contain a weakened or dead bacteria or virus. However, scientists have developed a new type of vaccine that uses a molecule called messenger RNA (mRNA) rather than part of an actual bacteria or virus. Messenger RNA is a type of RNA that is necessary for protein production.  Once cells finish making a protein, they quickly break down the mRNA. mRNA from vaccines does not enter the nucleus and does not alter DNA.

mRNA vaccines work by introducing a piece of mRNA that corresponds to a viral protein, usually a small piece of a protein found on the virus’s outer membrane. Individuals who get an mRNA vaccine are not exposed to the virus, nor can they become infected with the virus by the vaccine.

Solution: B

GOAL (Going Online as Leaders) is a joint initiative of Ministry of Tribal Affairs and Meta (formerly Facebook), which aims at digital empowerment of tribal youth and women through concept of mentor and mentee.

Going Online as Leaders (GOAL) Program was launched by Facebook in partnership with the Ministry of Tribal Affairs (MoTA) on 15th May 2020 to digitally skill and empower 5000 youth from tribal communities over the next five years. The project aims to identify and mobilise 2500 renowned people from the industry which include policy makers and influencers, teachers, artists, entrepreneurs and social workers known for their achievements in their respective domains, to personally mentor tribal youth across India. The nine-month program includes seven months of mentorship in areas such as digital literacy, life skills, leadership & entrepreneurship and sector-specific skills followed by a two-month internship for the mentees to gain an on-ground experience.

The programme is fully funded by Meta (Facebook India) and Ministry of Tribal Affairs has not incurred any expenditure or provided any funds for implementation of the program.

Solution: A

Dokra art is a traditional art of Jharkhand. It is also practiced in the neighboring states sharing common political boundaries and similar cultures. It is basically a brass-work (Metal Craft) done by the Malhore castes of the state.
Brass is a combination of copper and bronze. The artisans of Jharkhand practice the traditional “Lost Wax Technique” to craft their immigrations. The craft is described by its primitive simplicity, rustic beauty, and imaginative designs and patterns. The products are handcrafted and may have slight inconsistencies that are a natural outcome of human involvement in the process.

Solution: B

lithium (Li), chemical element of Group 1 (Ia) in the periodic table, the alkali metal group, lightest of the solid elements. The metal itself—which is soft, white, and lustrous.

A soft, silvery metal. It has the lowest density of all metals. It reacts vigorously with water.

Chemical properties

In many of its properties, lithium exhibits the same characteristics as do the more common alkali metals sodium and potassium. Thus, lithium, which floats on water, is highly reactive with it and forms strong hydroxide solutions, yielding lithium hydroxide (LiOH) and hydrogen gas. Lithium is the only alkali metal that does not form the anion, Li−, in solution or in the solid state.

Lithium is chemically active, readily losing one of its three electrons to form compounds containing the Li+ cation.

Solution: C

Khanij Bidesh India Ltd. (KABIL) is a joint venture company of three Central Public Sector Enterprises under Ministry of Mines, Government of India namely, National Aluminium Company Ltd. (NALCO), Hindustan Copper Ltd. (HCL) and Mineral Exploration and Consultancy Ltd. The company was set up in 2019 with an objective to identify, explore, acquire, develop, mine, process, procure and sell strategic minerals outside India. The strategic and other minerals are intended to be supplied primarily to India to meet the domestic requirement due to it’s none or meager availability in the country and giving a big push to Make in India.

The Authorized capital of the Company is Rs. 100 crore.

In order to ensure mineral security of the nation and to attain self-reliance in the area of critical and strategic minerals, the Ministry of Mines has created a Joint Venture company namely Khanij Bidesh India Ltd (KABIL) with participating interest of NALCO, HCL and MECL. KABIL is mandated to identify and acquire overseas mineral assets of critical and strategic nature such as Lithium, Cobalt etc. This initiative aimed at giving further fillip to AtmaNirbhar Bharat will cater to the requirements of crucial sectors such as e-mobility, renewable energy, medicine, aerospace, aviation etc.

The equity participation between NALCO, HCL and MECL is in the ratio of 40:30:30.

Solution: A

Amid China’s aggressive push to increase its Pacific sphere of influence, the US and its allies — Australia, New Zealand, Japan and the United Kingdom — have launched a new initiative called ‘Partners in the Blue Pacific’ for “effective and efficient cooperation” with the region’s small island nations.

The US and its allies — Australia, New Zealand, Japan and the United Kingdom — have launched a new initiative called ‘Partners in the Blue Pacific’ for “effective and efficient cooperation” with the region’s small island nations.

Why this new initiative?

• To counter China: The geostrategic competition in the pacific region intensified after China confirmed a common cooperation agreement with 10 Pacific nations.

What are the Partners in the Blue Pacific (PBP) initiative?

The PBP is a five-nation “informal mechanism” to support Pacific islands and boost diplomatic, and economic ties in the region.

Solution: B

NITI Aayog launched a report titled ‘India’s Booming Gig and Platform Economy’.

The report is a first-of-its-kind study that presents comprehensive perspectives and recommendations on the gig–platform economy in India.

The report estimates that in 2020–21, 77 lakh (7.7 million) workers were engaged in the gig economy. They constituted 2.6% of the non-agricultural workforce or 1.5% of the total workforce in India. The gig workforce is expected to expand to 2.35 crore (23.5 million) workers by 2029–30. Gig workers are expected to form 6.7% of the non-agricultural workforce or 4.1% of the total livelihood in India by 2029–30. At present, about 47% of the gig work is in medium skilled jobs, about 22% in high skilled, and about 31% in low skilled jobs.

Overall, the demand for gig workers has increased by 10X whereas the participation of gig workers has increased by 3X in the year 2022 in comparison to the year 2021, the Taskmo report 2022 showed.

Women’s participation has increased from 18% to 36% showing a remarkable growth of 2X last year whereas Youth participation in the Gig economy has seen an 8-fold increase between 2019-2022, the report further showed.

Solution: C

The Press Council of India is a statutory quasi-judicial autonomous authority re- established in the year 1979 under an Act of Parliament, Press Council Act, 1978 with the two fold objects of preserving the freedom of the press by maintaining and improving the standards of newspapers and the news agencies in India. It was first set up in 1966 under the Indian Press Council Act, 1965, on the recommendations of the first Press Commission with the identical twin objects. The 1965 Act was, however, repealed in 1975 and the Press Council was abolished during emergency. Thereafter, a new Act was enacted on the similar lines as the Act of 1965 and the Press Council was re-established under it in the year 1979.

The Council is a body corporate having perpetual succession comprising of a Chairman and 28 members. While the Chairman has, by convention, been a retired judge of the Supreme Court of India who is nominated by a Committee consisting of a Chairman of the Council of States (Rajya Sabha), Speaker of the House of People (Lok Sabha) and a person elected amongst themselves by the 28 members of the Council.

The objects of the Press Council of India as embodied in Section 13 of the Act are to preserve the freedom of the Press and to maintain and improve the standards of newspapers and news agencies in India.

Solution: A

Equalisation Levy

Equalisation Levy was introduced in India in 2016, with the intention of taxing the digital transactions i.e. the income accruing to foreign e-commerce companies from India. It is aimed at taxing business to business transactions.

Chapter VIII of the Finance Act, 2016, which came into effect from 1st June, 2016, had first introduced Equalisation Levy (EL). EL was not made part of the Income-tax Act (the Act) as the purpose of the levy was to bring to tax such income earned by non-residents which could not be taxed under the framework available under the Act. The scope of EL has been expanded by the Finance Act, 2020, through Part VI, to include non-resident e-commerce operators, engaged in the business of online sale/provision of goods and services.

Equalisation Levy is a direct tax, which is withheld at the time of payment by the service recipient. The two conditions to be met to be liable to equalisation levy:

• The payment should be made to a non-resident service provider;
• The annual payment made to one service provider exceeds Rs. 1,00,000 in one financial year.

Solution: C

What Is a Hybrid Security?

A hybrid security is a single financial security that combines two or more different financial instruments. Hybrid securities, often referred to as “hybrids,” generally combine both debt and equity characteristics. The most common type of hybrid security is a convertible bond that has features of an ordinary bond but is heavily influenced by the price movements of the stock into which it is convertible.

Hybrid securities are bought and sold on an exchange or through a brokerage. Hybrids may give investors a fixed or floating rate of return and may pay returns as interest or as dividends. Some hybrids return their face value to the holder when they mature and some have tax advantages. Hybrid securities can be viewed as a form of esoteric debt and may be difficult to sell due to their complexity.

Solution: B

The term Dutch disease was coined by The Economist magazine in 1977 when the publication analyzed a crisis that occurred in The Netherlands after the discovery of vast natural gas deposits in the North Sea in 1959.

Dutch disease is an economic term for the negative consequences that can arise from a spike in the value of a nation’s currency. It is primarily associated with the new discovery or exploitation of a valuable natural resource and the unexpected repercussions that such a discovery can have on the overall economy of a nation.

Understanding Dutch Disease

Dutch disease exhibits the following two chief economic effects:1

• It decreases the price competitiveness ofexports of the affected country’s manufactured goods.
• It increases imports.

Both phenomena result from a higher local currency.

Solution: A

Prepaid Payment Instruments (PPIs)

RBI as per the guidelines provided under the Payment and Settlement Act, 2005 defined Prepaid Payment Instruments (PPIs) as instruments of payment that facilitate buying of goods and services, including the transfer of funds, financial service and remittances, against the value stored within or on the instrument.

The value stored in the instrument is represented by the value that has already been paid for by the holder or the instrument by any method such as, by cash, by debit from a bank account, credit card or even from other PPIs. PPIs can come in the form of payment wallets, smart cards, magnetic chips, vouchers, mobile wallets etc. any instrument that can be used to access a prepaid amount is a PPI.

Who are the issuers of PPIs?

Ans. PPIs can be issued by banks and non-banks. Banks can issue PPIs after obtaining approval from RBI. The non-bank PPI issuers are companies incorporated in India and registered under the Companies Act, 1956 / 2013. They can operate a payment system for issuing PPIs to individuals / organisations after receiving authorisation from RBI.

Solution: B

GST Compensation Cess is levied by the Goods and Services Tax (Compensation to States) Act 2017. The object of levying this cess is to compensate the states for the loss of revenue arising due to the implementation of GST on 1st July 2017 for a period of five years or such period as recommended by the GST Council.

GST, being a consumption-based tax, would result in loss of revenue for manufacturing-heavy states.

All the taxpayers, except those who export specific notified goods and those who have opted for GST composition scheme, are liable to collect and remit the GST compensation cess to the central government.

• GST Compensation Cess is applicable on certain notified goods as mentioned in the GST (Compensation to States) Act, 2017. Compensation cess is applicable in addition to regular GST.
• GST Cess is also applicable on imported goods in accordance with section 3 of the Customs Tariff Act, 1975.

• GST Compensation Cess is levied in addition to regular GST on notified goods, mostly belonging to the luxury and demerit categories.

It has to be paid by all the taxpayers except those who export the notified goods and those who have opted for the GST composition scheme.

The compensation fund so collected is released to the states every 2 months.

Solution: A

Stagflation is a condition of slow economic growth and relatively high unemployment, or economic stagnation, accompanied by rising prices, or inflation. It can also be defined as inflation and a decline in gross domestic product (GDP).

Solution: A

Fiscal Consolidation refers to the policies undertaken by Governments (national and sub-national levels) to reduce their deficits and accumulation of debt stock.

Increasing the subsidies increases the expenditure of government. Thus, it will go against the principle of fiscal consolidation. Increasing the tax base increases the tax collection. Thus, it increases the revenue for the government and promotes the fiscal consolidation.

Supporting the export-oriented industries help in increasing the forex reserves of the country. Thus, help in promoting the fiscal consolidation.

Solution: D

The Qualified Foreign Investor (QFI) is sub-category of Foreign Portfolio Investor and refers to any foreign individuals, groups or associations, or resident, however, restricted to those from a country that is a member of Financial Action Task Force (FATF) or a country that is a member of a group which is a member of FATF and a country that is a signatory to International Organization of Securities Commission’s (IOSCO) Multilateral Memorandum of Understanding (MMOU).

QFIs are allowed to make investments in the following instruments by opening a demat account in any of the SEBI approved Qualified Depository Participant (QDP):

• Equity and Debt schemes of Indian mutual funds,
• Equity shares listed on recognized stock exchanges,
• Equity shares offered through public offers
• Corporate bonds listed/to be listed on recognized stock exchanges
• G-Securities, T-Bills and Commercial Papers

QFIs do not include FIIs/Sub-accounts/ Foreign Venture Capital Investor (FVCI).

Solution: B

External commercial borrowing forms the component of capital account. Other measures would result in current account surplus.

Solution: D

All the above institutions are part of World Bank Group.

The World Bank Group (WBG) is a family of five international organizations that make leveraged loans to developing countries. It is the largest and most well-known development bank in the world and is an observer at the United Nations Development Group

Its five organizations are the International Bank for Reconstruction and Development (IBRD), the International Development Association (IDA), the International Finance Corporation (IFC), the Multilateral Investment Guarantee Agency (MIGA) and the International Centre for Settlement of Investment Disputes (ICSID). The first two are sometimes collectively referred to as the World Bank.

Solution: D

The exchange rate of a country, such as India, is determined by several factors, both internal and external.

The Reserve Bank of India (RBI) sets the benchmark interest rates in India. Higher interest rates usually attract foreign investors who seek to earn higher returns on their investments. When foreign investors buy Indian assets such as stocks and bonds, they need to convert their currency into Indian Rupees, increasing the demand for Indian Rupees and hence appreciating the exchange rate

Inflation is another crucial factor affecting the exchange rate of India. Higher inflation rates can lead to a decrease in the purchasing power of a currency, reducing the demand for it in the forex market. A high inflation rate can also lead to a decrease in the value of a currency over time.

A country’s trade balance, which is the difference between exports and imports, can also influence the exchange rate. When a country exports more than it imports, it creates a surplus of its currency in the foreign exchange market, increasing the demand for its currency and appreciating the exchange rate. In contrast, when a country imports more than it exports, it creates a deficit of its currency, decreasing the demand for it and depreciating the exchange rate.

Solution: B

Large capital inflows usually lead to an appreciation of the exchange rate as foreign investors need to buy the local currency, increasing demand for it. This can make the country’s exports more expensive and its imports cheaper, resulting in a potential decrease in the competitiveness of the export sector.

Large capital inflows can lead to an increase in demand for assets such as stocks and real estate, which can drive up their prices.

Solution: C

A Bill is deemed to be a ‘Money Bill’ if it contains only provisions dealing with all or any of the following matters:

(a) the imposition, abolition, remission, alteration or regulation of any tax;

(b) the regulation of the borrowing of money or giving of any guarantee by the Government of India,  or the amendment of the law with respect to any financial obligations undertaken or to be undertaken by the Government of India;

(c) the custody of the Consolidated Fund or the Contingency Fund of India, the payment of moneys into or the withdrawal of moneys from any such Fund;

(d) the appropriation of moneys out of the Consolidated Fund of India;

(e) the declaring of any expenditure to be expenditure charged on the Consolidated Fund of India or the increasing of the amount of any such expenditure;

(f) the receipt of money on account of the Consolidated Fund of India or the public account of India or the custody or issue of such money or the audit of the accounts of the Union  or of a State; or

(g) any matter incidental to any of the matters specified in sub-clauses (a) to (f) [Art.110].

A Money Bill can be introduced only in the Lok Sabha.  The Rajya Sabha cannot make amendments in a Money Bill passed by the Lok Sabha and transmitted to it.  It can, however, recommend amendments in a Money Bill.  It is open to the Lok Sabha to accept or reject any or all of the recommendations of  the Rajya Sabha with regard to a Money Bill.

If a Money Bill  passed by  the Lok Sabha and transmitted to the Rajya Sabha  is not returned to the Lok Sabha within the period of fourteen days, it is deemed to have been passed by both Houses at the expiration of the said period in the form in which it was passed by the Lok Sabha.

Solution: A

• The Stiglitz Report, officially known as the “Report of the Commission on the Measurement of Economic Performance and Social Progress,” was commissioned by the then President of France, Nicolas Sarkozy, in 2008. The report was prepared by a team of economists, including Joseph Stiglitz, and aimed to develop new measures of economic and social progress beyond traditional measures such as Gross Domestic Product (GDP).
• The report identified several criticisms of the current international monetary and financial systems and recommended reforms to make them more equitable and efficient. The report proposed several measures, including reforming the International Monetary Fund (IMF) and the World Bank to increase their effectiveness, reducing global imbalances, and strengthening financial regulation to avoid future financial crises.

Solution: A

The Better Than Cash Alliance is a global partnership of governments, private sector companies, and international organizations that aims to accelerate the transition from cash to digital payments in order to improve financial inclusion, transparency, and efficiency. The alliance was launched in 2012 and is hosted by the United Nations Capital Development Fund.

• The Better Than Cash Alliance advocates for the adoption of digital payments by governments, businesses, and individuals as a means to drive economic growth, reduce poverty, and increase transparency. The alliance works with its members to identify and address the barriers to digital payments adoption, such as lack of infrastructure, low levels of digital literacy, and regulatory challenges.
• Some of the prominent members of the Better Than Cash Alliance include the governments of the United States, India, and Mexico, as well as private sector companies such as Visa, Mastercard, and PayPal.

Ans. B.

The passage talks about the need for policymakers to step into someone else’s shoes, which means that civil servants are expected to be empathetic. This is what the key idea of the passage is.

Ans. D.

The argument being made in the passage is that for right of property to be legitimate it needs to balance principle of liberty with equality and mutual cooperation. Statement d captures this.

Correct Answer: D

Reverse the first half and second half of the word.

Correct Option: B

We sleep in the ‘night’. but ‘night’ is called ‘sunshine’. So, we sleep in the ‘sunshine’ .

Correct Option: D

Following the common explanation, we can say that the code for ‘mountain’ is ‘ha’

Hence, the correct answer is option D.

Common Explanation:

weather is so cool → la pa ma se     …….(i)

so are we going → ma ne ta ra   …….(ii)

as going cool → pa ne he   …….(iii)

is weather hot → la se ka    …….(iv)

desert are hot → ka te ra  …….(v)

mountains are cool → pa ra ha   …….(vi)

From the equations (i) and (i), we get:

so → ma   …….(vii)

From the equations (i) and (iv), we get:

weather/is → la/se    …….(viii)

From the equations (i) and (iii), we get:

cool → pa  …….(ix)

From the equations (ii) and (iii), we get:

going → ne   ….(x)

From the equations (ii) and (v), we get:

are → ra    ….(xi)

From the equations (ii), (vii), (x) and (xi), we get:

we → ta    …….(xii)

From the equations (iii), (ix) and (x), we get:

as → he     …….(xiii)

From the equations (iv) and (v), we get:

hot → ka   ….(xiv)

From the equations (v), (xi) and (xiv), we get:

desert → te   ….(xv)

From the equations (vi), (ix) and (xi), we get:

mountains → ha   …….(xv)