UPSC Prelims Practice Questions — India helps China evade tariffs, claims U.S. report
Q1. The first tranche of additional duties imposed by the United States on Chinese goods in June 2018, following the findings of its Section 301 report, covered products of approximately what annual trade value?
- A. About USD 200 billion of annual imports from China
- B. About USD 34 billion of annual imports from China
- C. About USD 60 billion of annual imports from China
- D. About USD 16 billion of annual imports from China
Q2. Which one of the following bodies has the lead statutory responsibility for initiating investigations and determining action under Section 301 of the US Trade Act, 1974?
- A. The United States International Trade Commission, an independent bipartisan federal agency
- B. US Customs and Border Protection, under the Department of Homeland Security
- C. The Office of the United States Trade Representative, in the Executive Office of the President
- D. The International Trade Administration, under the Department of Commerce
Q3. In the context of the current US allegations against Chinese exporters, the term 'illegal transshipment' is best described as which one of the following?
- A. Movement of Chinese goods through a third country's ports and warehouses before onward shipment to the United States
- B. Declaring goods as originating in a third country when the processing done there is insufficient to confer that country's origin
- C. Declaring goods under a tariff heading that attracts a lower rate of duty than the heading properly applicable to them
- D. Re-export of Chinese goods to the United States after substantial transformation in a third country holding a preferential quota
Q4. Consider the following statements distinguishing lawful re-export from tariff evasion in third-country trade:
1. The routing of Chinese-made goods through a third country before their re-export to the United States is, in every case, a violation of US tariff law.
2. Whether a consignment amounts to evasion turns on whether the operations performed in the transit country are sufficient to confer that country's origin on the goods.
3. A change of tariff classification between the inputs and the finished product is one of the recognised criteria for determining that a substantial transformation has taken place.
Which of the statements given above is/are correct?
- The routing of Chinese-made goods through a third country before their re-export to the United States is, in every case, a violation of US tariff law.
- Whether a consignment amounts to evasion turns on whether the operations performed in the transit country are sufficient to confer that country's origin on the goods.
- A change of tariff classification between the inputs and the finished product is one of the recognised criteria for determining that a substantial transformation has taken place.
- A. 1 and 2 only
- B. 1 and 3 only
- C. 2 and 3 only
- D. 1, 2 and 3
Q5. The artificial-intelligence based screening system 'Detective Border', envisaged to match shipment declarations against routing histories, production capacity and container imaging, is being developed under which one of the following agencies?
- A. The Office of the United States Trade Representative
- B. The Bureau of Industry and Security, Department of Commerce
- C. The United States International Trade Commission
- D. United States Customs and Border Protection
Q6. The report singles out India, Mexico and one other economy as the largest single conduits of transshipped goods, together accounting for roughly USD 67 billion. Which one of the following is that third economy?
- A. Thailand
- B. Vietnam
- C. Malaysia
- D. Indonesia
Q7. The Sanctioning Russia and Iran Act of 2026, as cleared by the US Senate, authorises the imposition of 100% tariffs on goods from which one of the following categories of countries?
- A. All countries importing any quantity of crude oil or refined products of Russian origin
- B. Every country that has declined to endorse the price cap on Russian seaborne crude
- C. The five largest importers of oil and gas from Russia
- D. All countries whose refiners re-export Russian-origin refined products to the United States
Q8. Consider the following statements regarding the final US Section 301 measure on forced labour as compared with the measure originally proposed:
1. The additional ad valorem duty finally notified on Indian goods was lower than the rate that had been proposed at the outset.
2. The final determination followed a review by the USTR covering sixty economies.
3. Steel, aluminium and auto parts were brought within the scope of this additional duty, replacing the measures previously applicable to them under Section 232.
Which of the statements given above is/are correct?
- The additional ad valorem duty finally notified on Indian goods was lower than the rate that had been proposed at the outset.
- The final determination followed a review by the USTR covering sixty economies.
- Steel, aluminium and auto parts were brought within the scope of this additional duty, replacing the measures previously applicable to them under Section 232.
- A. 1 and 2 only
- B. 2 and 3 only
- C. 1 and 3 only
- D. 1, 2 and 3
Q9. The assessment that China supplies over 30% of India's industrial goods imports, characterising this concentration as a critical overdependence, was put out by which one of the following?
- A. The Economic Advisory Council to the Prime Minister
- B. The Trade Watch Quarterly published by NITI Aayog
- C. The Global Trade Research Initiative
- D. The Directorate General of Foreign Trade
Q10. Consider the following statements about India's merchandise trade with China in 2025-26 as compared with the preceding year:
1. India's exports to China contracted during the year, and the widening of the deficit was entirely on account of this fall in exports.
2. China displaced the United States to become India's largest trading partner during the year.
3. India's trade deficit with China touched an all-time high, crossing USD 110 billion.
Which of the statements given above is/are correct?
- India's exports to China contracted during the year, and the widening of the deficit was entirely on account of this fall in exports.
- China displaced the United States to become India's largest trading partner during the year.
- India's trade deficit with China touched an all-time high, crossing USD 110 billion.
- A. 1 and 2 only
- B. 1 and 3 only
- C. 2 and 3 only
- D. 1, 2 and 3
Q11. Which one of the following Indian ports recorded the country's highest-ever monthly automobile export volume in January 2026, shipping over 25,000 vehicles through its dedicated roll-on/roll-off terminal?
- A. Kamarajar Port, Tamil Nadu
- B. Mundra Port, Gujarat
- C. Kattupalli Port, Tamil Nadu
- D. Jawaharlal Nehru Port, Maharashtra