UPSC Prelims Practice Questions — The BRICS bank — an alternative that wasn’t

Q1. At the establishment of the New Development Bank, how many billion US dollars of its initial subscribed capital were to be paid-in capital?

  • A. US$ 10 billion
  • B. US$ 20 billion
  • C. US$ 50 billion
  • D. US$ 100 billion

Q2. In the founding arrangement of the New Development Bank, the expression 'initial subscribed capital' denotes which one of the following?

  • A. The ceiling on capital that the Bank's founding instrument permits it to issue to existing and future members over its lifetime
  • B. The capital that members guarantee to the Bank but supply only if it is called upon to meet obligations it cannot otherwise meet
  • C. The portion of the Bank's capital that the founding members committed to take up at inception, only a part of which was to be handed over in cash
  • D. The capital that founding members transferred to the Bank in cash before it began its lending operations from its headquarters

Q3. With reference to the governance and structure of the New Development Bank as compared with the Bretton Woods institutions, consider the following: 1. Unlike the IMF, where voting shares follow quotas, the NDB's initial subscribed capital was shared equally among its five founding members. 2. The NDB's first President was drawn from India, whereas the World Bank has by convention been headed by a national of the United States. 3. The NDB's initial subscribed capital was US$ 100 billion, of which US$ 50 billion was paid-in capital. 4. Lending by the NDB, unlike that of the World Bank, is restricted entirely to the sovereign governments of its member states. Which of the above is/are correctly identified?

  1. Unlike the IMF, where voting shares follow quotas, the NDB's initial subscribed capital was shared equally among its five founding members.
  2. The NDB's first President was drawn from India, whereas the World Bank has by convention been headed by a national of the United States.
  3. The NDB's initial subscribed capital was US$ 100 billion, of which US$ 50 billion was paid-in capital.
  4. Lending by the NDB, unlike that of the World Bank, is restricted entirely to the sovereign governments of its member states.
  • A. 2 and 4
  • B. 1 and 3
  • C. 1, 2 and 4
  • D. 1 and 2

Q4. Which one of the following serves as the nodal point of the Government of India for coordination with the New Development Bank?

  • A. The Department of Economic Affairs in the Ministry of Finance
  • B. The Department of Financial Services in the Ministry of Finance
  • C. The Department of Investment and Public Asset Management in the Ministry of Finance
  • D. The Economic Diplomacy Division in the Ministry of External Affairs

Q5. With reference to the commitments and access multipliers of members under the BRICS Contingent Reserve Arrangement, consider the following: 1. Brazil — committed US$ 10 billion to the pool, with an access multiplier of 1. 2. China — committed US$ 41 billion to the pool, with an access multiplier of 0.5. 3. Russia — committed US$ 18 billion to the pool, with an access multiplier of 2. 4. South Africa — committed US$ 5 billion to the pool, with an access multiplier of 2. Which of the above is/are correctly identified?

  1. Brazil — committed US$ 10 billion to the pool, with an access multiplier of 1.
  2. China — committed US$ 41 billion to the pool, with an access multiplier of 0.5.
  3. Russia — committed US$ 18 billion to the pool, with an access multiplier of 2.
  4. South Africa — committed US$ 5 billion to the pool, with an access multiplier of 2.
  • A. 1 and 3
  • B. 2 and 4
  • C. 1, 2 and 4
  • D. 3 and 4 only

Q6. With reference to the BRICS Contingent Reserve Arrangement, consider the following statements: 1. A member may draw the entirety of its access limit under the CRA without any linkage to an IMF arrangement. 2. The CRA provides support through liquidity and precautionary instruments in response to actual or potential short-term balance of payments pressures. 3. The maturity of a CRA liquidity instrument under its IMF-delinked portion is one year, renewable a maximum of two times. 4. The CRA was designed to complement existing international arrangements, serving as an additional line of defence in the global financial safety net. Which of the statements given above is/are NOT correct?

  1. A member may draw the entirety of its access limit under the CRA without any linkage to an IMF arrangement.
  2. The CRA provides support through liquidity and precautionary instruments in response to actual or potential short-term balance of payments pressures.
  3. The maturity of a CRA liquidity instrument under its IMF-delinked portion is one year, renewable a maximum of two times.
  4. The CRA was designed to complement existing international arrangements, serving as an additional line of defence in the global financial safety net.
  • A. 2 and 4
  • B. 1 and 2
  • C. 3 and 4
  • D. 1 and 3

Q7. In the context of the BRICS grouping's recent enlargement, the category of 'Partner Country' refers to which one of the following?

  • A. A state that has formally applied for full BRICS membership and has been placed on a waiting list pending consensus among the existing members
  • B. A state admitted to a tier created alongside the enlargement, which takes part in the grouping's proceedings without holding full membership
  • C. A non-member state that has concluded a financing agreement with the New Development Bank without acceding to the grouping itself
  • D. A member of the grouping that has not ratified the Contingent Reserve Arrangement treaty and therefore participates only in its economic track

Q8. With reference to the evolution of BRICS membership, consider the following: 1. Ethiopia — admitted as a full member in January 2024. 2. Indonesia — admitted as a full member in January 2025. 3. South Africa — accepted as a full member at a meeting of the BRIC Foreign Ministers held in September 2010. 4. Vietnam — admitted as a full member in January 2025, alongside Indonesia. Which of the above is/are correctly identified?

  1. Ethiopia — admitted as a full member in January 2024.
  2. Indonesia — admitted as a full member in January 2025.
  3. South Africa — accepted as a full member at a meeting of the BRIC Foreign Ministers held in September 2010.
  4. Vietnam — admitted as a full member in January 2025, alongside Indonesia.
  • A. 1 and 4
  • B. 2, 3 and 4
  • C. 1, 2 and 3
  • D. 3 only

Q9. The eighteenth BRICS Leaders' Summit of 2026 was convened under India's chairship, which had adopted for its year-long tenure which one of the following themes?

  • A. BRICS and Africa: Partnership for Mutually Accelerated Growth, Sustainable Development and Inclusive Multilateralism
  • B. Strengthening Multilateralism for Just Global Development and Security
  • C. Strengthening Global South Cooperation for More Inclusive and Sustainable Governance
  • D. Building for Resilience, Innovation, Cooperation and Sustainability

Q10. Which one of the following was the principal outcome document adopted by the leaders at the eighteenth BRICS Summit of 2026?

  • A. The New Delhi Action Plan on Counter-Terrorism, cleared by the leaders after negotiations
  • B. The Delhi Declaration, adopted by consensus among all the member states
  • C. The Humanity First Charter, signed by all the participating member states
  • D. The New Delhi Strategy for BRICS Economic Partnership, renewed at the summit

Q11. With reference to the New Development Bank's currency profile and its local-currency financing objective, consider the following statements: 1. The Bank's 2022-26 strategy set a target of extending 30 per cent of its total financing commitments in the national currencies of member countries. 2. The Bank has raised resources in the Chinese yuan and the South African rand, and has planned its first rupee-denominated bond issue in the Indian domestic market. 3. The Bank's local-currency financing had already crossed its 30 per cent target well before 2026, most of it denominated in the Indian rupee. 4. The Bank's 2027-31 strategy lowers the local-currency financing target below the level that had been set for 2022-26. Which of the statements given above is/are NOT correct?

  1. The Bank's 2022-26 strategy set a target of extending 30 per cent of its total financing commitments in the national currencies of member countries.
  2. The Bank has raised resources in the Chinese yuan and the South African rand, and has planned its first rupee-denominated bond issue in the Indian domestic market.
  3. The Bank's local-currency financing had already crossed its 30 per cent target well before 2026, most of it denominated in the Indian rupee.
  4. The Bank's 2027-31 strategy lowers the local-currency financing target below the level that had been set for 2022-26.
  • A. 3 and 4
  • B. 1 and 2
  • C. 2 and 3
  • D. 1, 3 and 4

Q12. Consider the following statements comparing India's position in the two financial arms of BRICS: 1. India's share in the initial subscribed capital of the New Development Bank was 20 per cent, whereas its committed contribution to the Contingent Reserve Arrangement was US$ 18 billion out of a pool of US$ 100 billion. 2. When the presidency of the New Development Bank changed hands in 2020, it passed to an Indian nominee, while the post of Vice-President and Chief Risk Officer went to Brazil. 3. The India Regional Office of the New Development Bank is located at GIFT City in Gujarat, while India has supported the location of the Bank's Africa Regional Centre in South Africa. Which of the statements given above is/are correct?

  1. India's share in the initial subscribed capital of the New Development Bank was 20 per cent, whereas its committed contribution to the Contingent Reserve Arrangement was US$ 18 billion out of a pool of US$ 100 billion.
  2. When the presidency of the New Development Bank changed hands in 2020, it passed to an Indian nominee, while the post of Vice-President and Chief Risk Officer went to Brazil.
  3. The India Regional Office of the New Development Bank is located at GIFT City in Gujarat, while India has supported the location of the Bank's Africa Regional Centre in South Africa.
  • A. 1 only
  • B. 1 and 2 only
  • C. 1 and 3 only
  • D. 1, 2 and 3