UPSC Prelims Practice Questions — ‘Upgrading India-Korea trade pact for balanced partnership’
Q1. In the context of India's trade agreements, a 'Comprehensive Economic Partnership Agreement (CEPA)' such as the one with the Republic of Korea is best described as an agreement that:
- A. liberalises trade in goods, trade in services and investment together with broader economic cooperation, going beyond a conventional free trade agreement in goods
- B. confines liberalisation to trade in goods through phased tariff concessions, leaving services and investment untouched
- C. covers only services and investment liberalisation while excluding trade in goods
- D. is a preferential arrangement limited to a small number of tariff lines with no binding investment or services commitments
Q2. On the Indian side, the ongoing India-Korea CEPA upgrade negotiations are led and operationalised by which one of the following?
- A. Department of Commerce, Ministry of Commerce and Industry
- B. Department for Promotion of Industry and Internal Trade (DPIIT), Ministry of Commerce and Industry
- C. Department of Economic Affairs, Ministry of Finance
- D. Economic Diplomacy Division, Ministry of External Affairs
Q3. Official statistics on India's merchandise trade deficit with the Republic of Korea are compiled and released primarily by which one of the following?
- A. Directorate General of Commercial Intelligence and Statistics (DGCIS) under the Department of Commerce
- B. National Statistical Office (NSO) under the Ministry of Statistics and Programme Implementation
- C. Reserve Bank of India through its Balance of Payments statement
- D. Directorate General of Foreign Trade (DGFT)
Q4. To correct the widening trade imbalance, India and the Republic of Korea have set a target to roughly double their bilateral trade from the current level of about USD 27 billion by which target year?
- A. 2027
- B. 2030
- C. 2032
- D. 2035
Q5. Which one of the following best describes the principal trade outcome of Korean President Lee Jae Myung's April 2026 State visit to India?
- A. The signing of a Joint Declaration committing both sides to accelerate the upgrade of the existing India-Korea CEPA
- B. The entry into force of a fully renegotiated 'CEPA 2.0' replacing the 2010 agreement
- C. The conclusion of an entirely new free trade agreement superseding the CEPA
- D. India's accession to a Korea-led regional trade bloc
Q6. Several Memoranda of Understanding (MoUs) were signed during the April 2026 India-Korea summit. In international practice, an MoU is best defined as:
- A. a non-binding instrument recording the parties' intent to cooperate, generally not creating enforceable legal obligations
- B. a legally binding treaty requiring ratification and registration under the Vienna Convention on the Law of Treaties
- C. a unilateral declaration issued by one government that binds the other party
- D. a ratified protocol that automatically amends the text of an existing treaty
Q7. The India-EFTA Trade and Economic Partnership Agreement (TEPA), frequently cited alongside the India-Korea CEPA upgrade as part of India's FTA strategy, is correctly described by which one of the following?
- A. It entered into force on 1 October 2025 and carries a landmark USD 100 billion investment commitment.
- B. It entered into force in 2024, the same year it was signed, with a USD 100 billion investment commitment.
- C. It entered into force in 2025 with a USD 50 billion investment commitment.
- D. It entered into force in 2022 with a USD 100 billion investment commitment.
Q8. The European Free Trade Association (EFTA), with which India concluded the TEPA, is composed of how many member states?
Q9. Under the 'Special Strategic Partnership' established between India and the Republic of Korea in 2015, the two sides agreed to hold summit-level meetings at what frequency?
- A. Once every year (annually)
- B. Once every two years
- C. Twice every year
- D. Only on the margins of multilateral events