UPSC Prelims Practice Questions — Include proposal to link digital currencies on the BRICS agenda, says RBI

Q1. With reference to the two variants of India's Digital Rupee (e₹) pilots launched by the Reserve Bank of India, consider the following statements: Which of the statements given above is/are correct?

  1. The wholesale Digital Rupee (e₹-W) pilot was launched for settlement of secondary market transactions in government securities.
  2. The retail Digital Rupee (e₹-R) pilot was launched ahead of the wholesale pilot in a closed user group.
  3. Both e₹-W and e₹-R are legal tender issued by the Reserve Bank of India.
  • A. 1 and 2 only
  • B. 1 and 3 only
  • C. 2 and 3 only
  • D. 1, 2 and 3

Q2. Which country holds the Chair of the BRICS grouping in 2026 and will therefore host the 18th BRICS Summit?

  • A. Brazil
  • B. Russia
  • C. India
  • D. South Africa

Q3. The Reserve Bank of India derives its statutory authority to issue the Digital Rupee (e₹) from which one of the following?

  • A. Payment and Settlement Systems Act, 2007
  • B. Reserve Bank of India Act, 1934, as amended by the Finance Act, 2022
  • C. Foreign Exchange Management Act, 1999
  • D. Banking Regulation Act, 1949

Q4. Which one of the following best describes a 'Central Bank Digital Currency (CBDC)' as referred to in the RBI's proposal for the BRICS 2026 agenda?

  • A. A privately-issued cryptocurrency whose value is algorithmically linked to a basket of fiat currencies
  • B. A stablecoin issued by commercial banks and fully backed by central bank reserves
  • C. Sovereign currency issued by a central bank in digital form, recognised as legal tender and exchangeable at par with physical fiat currency
  • D. A unit of account created by an international financial institution for the exclusive purpose of cross-border settlement

Q5. As of January 2026, following Indonesia's accession, how many countries are full members of the BRICS grouping?

  • A. 9
  • B. 10
  • C. 11
  • D. 12
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