UPSC Prelims Practice Questions — LAUNCHING OF NEGOTIATIONS FOR THE EXPANSION OF THE INDIA-MERCOSUR PREFERENTIAL TRADE AGREEMENT

Q1. The permanent administrative secretariat that services the organs of MERCOSUR is located in which one of the following cities?

  • A. Asuncion, where the bloc's founding treaty was signed and where all of its permanent organs are necessarily based
  • B. Brasilia, the capital of the bloc's largest member and therefore the fixed seat of all its institutions
  • C. Montevideo, the capital of one of the four founding member States of the bloc
  • D. Buenos Aires, the capital of the bloc's second largest economy and its designated permanent headquarters

Q2. Which one of the following was the first State to be admitted as a full member of MERCOSUR after its four founding signatories?

  • A. Bolivia, which was long confined to associate status on account of its membership of the Andean Community
  • B. Venezuela, whose full membership was approved by the presidents of the four founding States and took effect in 2012
  • C. Chile, which was admitted as a full member in 1996 while retaining its own independent tariff schedule
  • D. Peru, which joined as a full member along with Colombia after expressing interest in the mid-1990s

Q3. Consider the following statements comparing a free trade area with a preferential trade arrangement under the multilateral trade rules: 1. A free trade area requires the elimination of duties and other restrictive regulations of commerce on substantially all the trade between the constituent territories. 2. A preferential arrangement among developing countries may be notified under the Enabling Clause, which operates as an exception to the most-favoured-nation obligation. 3. Unlike a free trade area, a preferential trade arrangement obliges its parties to adopt a common external tariff on imports from third countries. Which of the statements given above is/are correct?

  1. A free trade area requires the elimination of duties and other restrictive regulations of commerce on substantially all the trade between the constituent territories.
  2. A preferential arrangement among developing countries may be notified under the Enabling Clause, which operates as an exception to the most-favoured-nation obligation.
  3. Unlike a free trade area, a preferential trade arrangement obliges its parties to adopt a common external tariff on imports from third countries.
  • A. 1 and 2 only
  • B. 2 and 3 only
  • C. 1 and 3 only
  • D. 1, 2 and 3

Q4. Which one of the following was the first comprehensive trade agreement signed by India with a group of developed European economies, as distinct from a limited tariff-line arrangement?

  • A. The Comprehensive Economic and Trade Agreement with the United Kingdom, signed in July 2025
  • B. The India-European Union trade agreement, covering the bloc's twenty-seven member States
  • C. The Trade and Economic Partnership Agreement with Switzerland, Norway, Iceland and Liechtenstein, signed in March 2024
  • D. The agreement with the Eurasian Economic Union, covering Russia, Belarus, Kazakhstan, Armenia and Kyrgyzstan

Q5. Consider the following statements regarding the evolution of India's trade arrangement with MERCOSUR: 1. The Framework Agreement was signed at Asuncion in June 2003, whereas the Preferential Trade Agreement itself was signed at New Delhi in January 2004. 2. The Framework Agreement of 2003 itself extended tariff concessions on 450 tariff lines, which were subsequently withdrawn when the Preferential Trade Agreement was signed. 3. Five annexes to the Preferential Trade Agreement were signed in 2005, and the Agreement came into effect in 2009. Which of the statements given above is/are correct?

  1. The Framework Agreement was signed at Asuncion in June 2003, whereas the Preferential Trade Agreement itself was signed at New Delhi in January 2004.
  2. The Framework Agreement of 2003 itself extended tariff concessions on 450 tariff lines, which were subsequently withdrawn when the Preferential Trade Agreement was signed.
  3. Five annexes to the Preferential Trade Agreement were signed in 2005, and the Agreement came into effect in 2009.
  • A. 1 and 3 only
  • B. 1 and 2 only
  • C. 2 and 3 only
  • D. 1, 2 and 3

Q6. Under the India-MERCOSUR Preferential Trade Agreement, on how many tariff lines did MERCOSUR extend preferential concessions to India?

  • A. 450 tariff lines, with margins of preference ranging from 10 per cent to 100 per cent
  • B. 452 tariff lines, with margins of preference ranging from 10 per cent to 100 per cent
  • C. 902 tariff lines, being the entire schedule exchanged by the two sides under the Agreement
  • D. 224 tariff lines, being the whole of the offer contained in the annexes signed in 2005

Q7. In the context of the 2025 understanding between India and Brazil on widening the MERCOSUR-India trade arrangement, the Joint Administration Committee is best described as which one of the following?

  • A. A World Trade Organization body that examines preferential arrangements notified by developing country members and reports on their operation
  • B. A body established by the trade agreement itself, which the two sides agreed to convene for technical dialogue on defining the scope of the widening exercise
  • C. A panel constituted under the 2003 Framework Agreement to settle disputes between the parties on rules of origin and product certification
  • D. A standing organ of MERCOSUR's Common Market Group responsible for fixing and revising the bloc's common external tariff

Q8. The Joint Administration Committee that India and Brazil agreed in 2025 to convene for the MERCOSUR-India exercise draws its existence from which one of the following provisions?

  • A. Article 14 of the Preferential Trade Agreement
  • B. Article 23 of the Framework Agreement of 2003
  • C. Article 23 of the Preferential Trade Agreement
  • D. Article XXIV of the General Agreement on Tariffs and Trade, 1994

Q9. The India-MERCOSUR Preferential Trade Agreement's expansion figured in the Indian Prime Minister's meeting with the President of Uruguay at Rio de Janeiro in 2025. That summit was which edition of BRICS, and under whose Chairship was it convened?

  • A. The 16th Summit, under the Chairship of Russia
  • B. The 18th Summit, under the Chairship of India
  • C. The 17th Summit, under the Chairship of South Africa
  • D. The 17th Summit, under the Chairship of Brazil

Q10. With reference to the BRICS grouping at the time of its Rio de Janeiro Summit, consider the following: 1. Indonesia took part as a full member, having been admitted to the grouping in January 2025. 2. Uruguay, whose President held a bilateral meeting with the Indian Prime Minister at the Summit, participated as a full member of the grouping. 3. Brazil held the Chairship for 2025 and handed it over to India at the close of the Summit. 4. India will host the next Summit, which will be its fourth Chairship of the grouping. Which of the statements given above is/are correct?

  1. Indonesia took part as a full member, having been admitted to the grouping in January 2025.
  2. Uruguay, whose President held a bilateral meeting with the Indian Prime Minister at the Summit, participated as a full member of the grouping.
  3. Brazil held the Chairship for 2025 and handed it over to India at the close of the Summit.
  4. India will host the next Summit, which will be its fourth Chairship of the grouping.
  • A. 1 and 2
  • B. 2 and 4
  • C. 1, 3 and 4
  • D. 3 only

Q11. India's negotiation and administration of trade agreements such as the CETA with the United Kingdom and the TEPA with the EFTA States is handled by which one of the following?

  • A. The Department of Economic Affairs under the Ministry of Finance, which handles India's tariff schedules and customs notifications
  • B. The Department of Commerce under the Ministry of Commerce and Industry
  • C. The Department for Promotion of Industry and Internal Trade under the same Ministry, which handles industrial policy and foreign investment
  • D. The Economic Diplomacy Division of the Ministry of External Affairs, which handles India's economic engagement with foreign governments

Q12. Consider the following statements about the four founding members of MERCOSUR: 1. Paraguay is the only landlocked State among them. 2. Measured by gross domestic product at current prices, Argentina is the largest economy of the bloc, ahead of Brazil. 3. The bloc accounts for roughly three-fourths of South America's gross domestic product and about three-fifths of its population. Which of the statements given above is/are correct?

  1. Paraguay is the only landlocked State among them.
  2. Measured by gross domestic product at current prices, Argentina is the largest economy of the bloc, ahead of Brazil.
  3. The bloc accounts for roughly three-fourths of South America's gross domestic product and about three-fifths of its population.
  • A. 1 and 2 only
  • B. 2 and 3 only
  • C. 1 and 3 only
  • D. 1, 2 and 3