UPSC Prelims Practice Questions — Foreign demand for cube sugar

Q1. The State Trading Corporation (STC) acted as the canalising agency for several essential commodities. Which of the following commodities is/are correctly identified as having been canalised through the STC (and not through another agency)?

  1. Edible oils
  2. Wheat
  3. Iron ore
  4. Sugar
  • A. 1, 2 and 4
  • B. 1 and 3
  • C. 2, 3 and 4
  • D. 1, 2, 3 and 4

Q2. The items below are listed as commodities canalised through the State Trading Corporation (STC). Which one of the above is NOT correctly identified as an STC-canalised item?

  1. Pulses
  2. Sugar
  3. Non-ferrous metals
  4. Edible oils
  • A. 1 only
  • B. 3 only
  • C. 2 and 4
  • D. 1 and 3

Q3. Which one of the following was the designated canalising agency principally handling India's import and export of metals and minerals?

  • A. State Trading Corporation (STC)
  • B. Metals and Minerals Trading Corporation (MMTC)
  • C. Project and Equipment Corporation (PEC)
  • D. National Agricultural Cooperative Marketing Federation (NAFED)

Q4. India's canalising agencies such as the STC and MMTC functioned under the administrative control of which Union Ministry?

  • A. Ministry of Finance
  • B. Ministry of Commerce and Industry
  • C. Ministry of Consumer Affairs, Food and Public Distribution
  • D. Ministry of External Affairs

Q5. According to the report, how many mills in India were actually producing cube sugar at the time of the foreign enquiry?

  • A. One only
  • B. Two
  • C. Four
  • D. None — no Indian mill produced cube sugar

Q6. According to Encyclopaedia Britannica, cube (lump) sugar is manufactured by which one of the following processes?

  • A. Molding and pressing granulated sugar with a sugary liquid, then drying it
  • B. Direct crystallisation of cube-shaped grains from boiling cane juice
  • C. Freeze-drying refined sugar syrup in cube-shaped trays
  • D. Spray-drying molasses to form compact granules

Q7. As reported, India's record foreign-exchange earning from white crystal sugar exports (routed through the STC) in the year preceding the news item was approximately —

  • A. Rs 314 crore
  • B. Rs 425 crore
  • C. Rs 624 crore
  • D. Rs 210 crore

Q8. In the context of India's 1970s export regime, the 'canalisation' of a commodity is best defined as —

  • A. The routing of all trade in a specified commodity exclusively through a designated state agency
  • B. The fixing of a minimum export price below which the commodity cannot be shipped
  • C. The diversion of surplus produce into government buffer stocks
  • D. The levy of an export duty to discourage outbound shipments

Q9. For the 2025-26 sugar season, the Indian Sugar Mills Association (ISMA) sought from the government a sugar export quota of about —

  • A. 1 million tonnes
  • B. 2 million tonnes
  • C. 5 million tonnes
  • D. 10 million tonnes

Q10. In India's current sugar policy debate, the term 'ethanol diversion' refers to —

  • A. Channelling a portion of sugarcane / molasses away from sugar production towards ethanol manufacturing for fuel blending
  • B. Importing ethanol to blend with domestically produced sugar
  • C. Reconverting surplus ethanol back into refined sugar during shortages
  • D. Exporting ethanol in the place of sugar to meet trade targets

Q11. In 2026, the order shifting raw, white and refined sugar from the 'restricted' to the 'prohibited' export category (till 30 September 2026) was issued by which authority?

  • A. Reserve Bank of India
  • B. Directorate General of Foreign Trade (DGFT)
  • C. Food Corporation of India
  • D. Indian Sugar Mills Association

Q12. Which of the following public-sector trading corporations is/are correctly matched with the sector it canalised?

  1. MMTC — non-ferrous metals and minerals
  2. PEC — machinery and railway equipment
  3. STC — precious metals and gold jewellery
  4. STC — essential items of mass consumption (wheat, pulses, sugar, edible oils)
  • A. 1 and 3
  • B. 1, 2 and 4
  • C. 2 and 3
  • D. 1, 2, 3 and 4