UPSC Prelims Practice Questions — ‘FTA will anchor manufacturers into global value chain’

Q1. The India–European Union Free Trade Agreement, concluded in January 2026, was negotiated on the Indian side by which one of the following?

  • A. Ministry of External Affairs
  • B. Department of Commerce, Ministry of Commerce and Industry
  • C. Department for Promotion of Industry and Internal Trade
  • D. NITI Aayog

Q2. With reference to the India–European Union Free Trade Agreement concluded in January 2026, consider the following statements: 1. The total tariff-liberalisation coverage offered by the European Union (about 99.3%) is greater than that offered by India (about 96.6%). 2. The Agreement, in addition to goods, also concluded a separate set of negotiations on Financial Services. 3. India has agreed to phase down its tariff on imported cars from 110% to a level as low as 10%. Which of the statements given above are correct?

  1. The total tariff-liberalisation coverage offered by the European Union (about 99.3%) is greater than that offered by India (about 96.6%).
  2. The Agreement, in addition to goods, also concluded a separate set of negotiations on Financial Services.
  3. India has agreed to phase down its tariff on imported cars from 110% to a level as low as 10%.
  • A. 1 and 2 only
  • B. 1 and 3 only
  • C. 2 and 3 only
  • D. 1, 2 and 3

Q3. With reference to the India–EU FTA (January 2026), consider the following Indian export sectors: 1. Textiles and apparel 2. Marine products 3. Crude petroleum 4. Gems and jewellery Which of the above are correctly identified as labour-intensive sectors whose exports to the EU will move to zero duty on entry into force of the Agreement?

  1. Textiles and apparel
  2. Marine products
  3. Crude petroleum
  4. Gems and jewellery
  • A. 1 and 4 only
  • B. 2 and 3 only
  • C. 1, 2 and 4 only
  • D. 1, 2, 3 and 4

Q4. In the context of the India–EU Free Trade Agreement, the term 'tariff line' is best defined as which one of the following?

  • A. The maximum bound duty that a WTO member has committed not to exceed under GATT Article II
  • B. An individual product category in a country's customs classification (Harmonized System) against which a specific rate of customs duty is levied
  • C. The notional threshold above which an importing country may invoke safeguard measures under WTO rules
  • D. The annual quantitative ceiling assigned to a partner country under a tariff-rate quota arrangement

Q5. With reference to the labour-intensive sectors that will enjoy zero EU import duty from the date of entry into force of the India–EU FTA, consider the following: 1. Leather and footwear 2. Marine products 3. Iron ore concentrates 4. Textiles and apparel Which of the above is/are NOT correctly identified as such a sector?

  1. Leather and footwear
  2. Marine products
  3. Iron ore concentrates
  4. Textiles and apparel
  • A. 1 and 3 only
  • B. 2 and 4 only
  • C. 3 only
  • D. 3 and 4 only