UPSC Prelims Practice Questions — Prime Minister welcomes framework for Interim Trade Agreement between India and the United States, calls it a boost to ‘Make in India’ and Employment

Q1. In the context of the February 2026 India–US trade announcement, the 'framework for an Interim Agreement' welcomed by the Prime Minister is best described as which one of the following?

  • A. A precursor arrangement that reaffirms and precedes the broader India–US Bilateral Trade Agreement (BTA) negotiations
  • B. A fully ratified free trade agreement that permanently replaces all earlier bilateral tariff arrangements
  • C. A dispute-settlement understanding concluded within the World Trade Organization framework
  • D. A customs union under which India and the US adopt a common external tariff

Q2. On the trade track, the negotiation and operationalisation of the India–US Interim Trade Agreement is led primarily by which Indian department/ministry?

  • A. Department of Commerce, Ministry of Commerce and Industry
  • B. Department for Promotion of Industry and Internal Trade (DPIIT)
  • C. Department of Economic Affairs, Ministry of Finance
  • D. Ministry of External Affairs (Economic Diplomacy Division)

Q3. 'Mission 500', the goal of raising India–US bilateral trade to USD 500 billion by 2030, was launched through a Modi–Trump joint statement in which year?

  • A. 2025
  • B. 2023
  • C. 2024
  • D. 2026

Q4. With reference to the Modi–Trump joint statement of 13 February 2025, consider the following: 1. It set the 'Mission 500' target of more than doubling bilateral trade to USD 500 billion by 2030. 2. It launched the US–India COMPACT for the 21st Century. 3. It launched negotiations for a bilateral trade agreement (BTA). 4. It set a target of USD 1 trillion in bilateral trade by 2035. Which of the statements given above is/are correct?

  1. It set the 'Mission 500' target of more than doubling bilateral trade to USD 500 billion by 2030.
  2. It launched the US–India COMPACT for the 21st Century.
  3. It launched negotiations for a bilateral trade agreement (BTA).
  4. It set a target of USD 1 trillion in bilateral trade by 2035.
  • A. 1, 2 and 3
  • B. 1 and 3 only
  • C. 2 and 4 only
  • D. 1, 2 and 4

Q5. Under the February 2026 framework, the 18% duty that the United States will apply on originating goods of India is characterised as which one of the following?

  • A. A reciprocal tariff, reduced from the earlier 25% reciprocal rate
  • B. A countervailing duty imposed to offset Indian export subsidies
  • C. An anti-dumping duty on goods sold below normal value
  • D. A most-favoured-nation bound tariff notified under WTO schedules

Q6. The additional 25% US tariff on Indian goods, revoked in February 2026, had originally been imposed through which type of instrument?

  • A. A United States Presidential Executive Order
  • B. A statute enacted by the US Congress
  • C. A ruling of the US Court of International Trade
  • D. A determination of the WTO's dispute-settlement body

Q7. India's ~USD 500 billion five-year purchase pledge covers several categories of US goods. Which category is named foremost/first among these commitments?

  • A. Energy products
  • B. Coking coal
  • C. Precious metals
  • D. Passenger automobiles

Q8. India's commitment to purchase ~USD 500 billion of US energy products, aircraft and parts, precious metals, technology products and coking coal is to be fulfilled over what period?

  • A. The next 5 years
  • B. The next 3 years
  • C. The next 10 years
  • D. By the end of 2030

Q9. With reference to the groups officially flagged as beneficiaries of the India–US Interim Trade Agreement framework, consider the following: 1. MSMEs and start-ups. 2. Fishermen. 3. Women-led MSMEs exporting garments, leather and handicrafts. 4. Large-scale crude-oil refiners exporting refined products to the US. Which of the above is/are correctly identified as flagged beneficiaries?

  1. MSMEs and start-ups.
  2. Fishermen.
  3. Women-led MSMEs exporting garments, leather and handicrafts.
  4. Large-scale crude-oil refiners exporting refined products to the US.
  • A. 1, 2 and 3
  • B. 1 and 4 only
  • C. 2, 3 and 4
  • D. 1, 3 and 4

Q10. The Prime Minister framed the Interim Trade Agreement as a boost to 'Make in India'. In this context, 'Make in India' primarily refers to which one of the following?

  • A. India's initiative to expand and globalise its domestic manufacturing base
  • B. A United States programme to reshore American manufacturing jobs
  • C. A WTO scheme granting tariff preferences to developing countries
  • D. A bilateral India–US defence co-production treaty

Q11. The India–EU Free Trade Agreement, whose negotiations were concluded around January 2026, is reported to deliver market access for what share of India's exports by trade value?

  • A. More than 99%
  • B. About 85%
  • C. About 75%
  • D. About 50%

Q12. In India, the Department of Commerce—the nodal department negotiating agreements such as the India–US BTA—functions under which Union ministry?

  • A. Ministry of Commerce and Industry
  • B. Ministry of External Affairs
  • C. Ministry of Finance
  • D. Ministry of Micro, Small and Medium Enterprises