UPSC Prelims Practice Questions — Pre-empting proposed FTA, British luxury carmakers slash prices in India
Q1. Which one of the following is the nodal department of the Government of India that negotiated and operationalises the India-UK Comprehensive Economic and Trade Agreement (CETA), 2025?
- A. Department of Commerce, Ministry of Commerce and Industry
- B. Department for Promotion of Industry and Internal Trade
- C. Department of Heavy Industry, Ministry of Heavy Industries
- D. Central Board of Indirect Taxes and Customs, Ministry of Finance
Q2. With reference to recent developments, which one of the following is described as India's most comprehensive Free Trade Agreement signed with a G7 economy since the India-Japan CEPA (2011)?
- A. India-Australia Economic Cooperation and Trade Agreement (ECTA)
- B. India-UAE Comprehensive Economic Partnership Agreement (CEPA)
- C. India-United Kingdom Comprehensive Economic and Trade Agreement (CETA)
- D. India-European Free Trade Association Trade and Economic Partnership Agreement (TEPA)
Q3. Consider the following sectors with respect to Indian exports to the United Kingdom under the India-UK CETA, 2025:
1. Textiles and apparel
2. Petroleum crude
3. Marine products
4. Gems and jewellery
Which of the above are correctly identified as key Indian export beneficiaries receiving duty-free or duty-reduced access to the UK market under CETA?
- Textiles and apparel
- Petroleum crude
- Marine products
- Gems and jewellery
- A. 1, 2 and 3 only
- B. 1, 3 and 4 only
- C. 2 and 4 only
- D. 1, 2, 3 and 4
Q4. With reference to the tariff architecture for automobiles under the India-UK CETA, 2025, consider the following statements:
1. India's current Most-Favoured-Nation (MFN) applied customs duty on completely built unit (CBU) imports is 110%.
2. Under CETA, the in-quota duty on qualifying ICE CBUs is scheduled to fall to 10% by Year 5 of implementation.
3. The Year-1 quota for British ICE CBUs at the concessional duty is 20,000 units, rising to 37,000 units by Year 5.
4. Electric vehicles and hybrid vehicles imported as CBUs receive the same Year-1 concessional duty as ICE vehicles from the date of CETA's entry into force.
Which of the above statements is/are NOT correct?
- India's current Most-Favoured-Nation (MFN) applied customs duty on completely built unit (CBU) imports is 110%.
- Under CETA, the in-quota duty on qualifying ICE CBUs is scheduled to fall to 10% by Year 5 of implementation.
- The Year-1 quota for British ICE CBUs at the concessional duty is 20,000 units, rising to 37,000 units by Year 5.
- Electric vehicles and hybrid vehicles imported as CBUs receive the same Year-1 concessional duty as ICE vehicles from the date of CETA's entry into force.
- A. 1 only
- B. 2 and 3 only
- C. 4 only
- D. 1, 2 and 3 only
Q5. In the context of India's customs tariff schedule for automobiles referenced under the India-UK CETA, 2025, the term 'CBU' refers to:
- A. A vehicle imported in fully assembled form, ready for sale without further assembly in the importing country
- B. A vehicle imported as a set of major sub-assemblies (engine, transmission, body) that are bolted together in the importing country
- C. A vehicle imported as a kit of individual parts to be fully assembled, welded and painted in the importing country
- D. A vehicle manufactured domestically using imported components above a specified value-addition threshold