UPSC Prelims Practice Questions — Iran war to weigh more on Indian growth, keeping interest rates low

Q1. With reference to India's Strategic Petroleum Reserve (SPR) programme, consider the following locations of crude oil storage facilities (existing or approved under Phase I/Phase II): 1. Vishakhapatnam in Andhra Pradesh 2. Mangaluru and Padur in Karnataka 3. Chandikhol in Odisha 4. Bina in Madhya Pradesh Which of the above is/are correctly identified?

  1. Vishakhapatnam in Andhra Pradesh
  2. Mangaluru and Padur in Karnataka
  3. Chandikhol in Odisha
  4. Bina in Madhya Pradesh
  • A. 1 and 2 only
  • B. 3 and 4 only
  • C. 1, 2 and 3 only
  • D. 1, 2, 3 and 4

Q2. In the Indian monetary policy context, the 'Flexible Inflation Targeting' (FIT) framework is best defined as:

  • A. A framework under which the Central Government, in consultation with the RBI, notifies a CPI inflation target once every five years with a symmetric tolerance band, and the MPC sets the policy rate to achieve it
  • B. A framework under which the RBI Governor unilaterally fixes a WPI-based inflation target each fiscal year
  • C. A framework under which the Ministry of Finance announces a core-inflation band quarterly and the RBI defends it through open market operations
  • D. A framework under which the policy rate is mechanically linked to the GDP deflator within a band notified by the Finance Commission

Q3. As per the amended Reserve Bank of India Act, 1934, the Monetary Policy Committee (MPC) that decides the policy repo rate consists of how many members?

  • A. Four
  • B. Five
  • C. Six
  • D. Seven

Q4. With reference to India's crude oil import profile in 2025 as compared to the earlier period, consider the following statements: 1. India now sources crude oil from about 40 countries, up from around 27 countries earlier. 2. About 70 per cent of India's crude imports now arrive via routes outside the Strait of Hormuz, compared with around 55 per cent earlier. 3. The crude storage capacity approved under Phase II of the SPR programme is lower than the total capacity commissioned under Phase I. Which of the statements given above is/are correct?

  1. India now sources crude oil from about 40 countries, up from around 27 countries earlier.
  2. About 70 per cent of India's crude imports now arrive via routes outside the Strait of Hormuz, compared with around 55 per cent earlier.
  3. The crude storage capacity approved under Phase II of the SPR programme is lower than the total capacity commissioned under Phase I.
  • A. 1 only
  • B. 1 and 2 only
  • C. 2 and 3 only
  • D. 1, 2 and 3

Q5. India's Strategic Petroleum Reserve (SPR) programme — frequently cited as a buffer against West Asia oil-price shocks — is operationalised by:

  • A. Indian Strategic Petroleum Reserves Limited (ISPRL), a Special Purpose Vehicle under the Ministry of Petroleum and Natural Gas
  • B. Oil Industry Development Board under the Ministry of Finance
  • C. Petroleum and Natural Gas Regulatory Board under the Department for Promotion of Industry and Internal Trade
  • D. Directorate General of Hydrocarbons under the Ministry of External Affairs