Economy MCQs for UPSC Prelims — January 2026

Q1. The Economic Survey, presented to Parliament a day before the Union Budget, is prepared by which one of the following?

• A. Department of Expenditure, Ministry of Finance
• B. Department of Economic Affairs, Ministry of Finance
• C. Department of Revenue, Ministry of Finance
• D. NITI Aayog, in association with the Ministry of Finance

Q2. The Economic Survey 2025-26, tabled in Parliament on 29 January 2026, was authored under the authority of which one of the following Chief Economic Advisers?

• A. Krishnamurthy V. Subramanian
• B. Arvind Subramanian
• C. V. Anantha Nageswaran
• D. Raghuram G. Rajan

Q3. Which one of the following is the central conceptual pillar around which the Economic Survey 2025-26 is organised?

• A. Universal Basic Income
• B. Blue Economy
• C. Entrepreneurial State
• D. Hockey-Stick Growth Trajectory

Q4. With reference to the 'Entrepreneurial State' as articulated in the Economic Survey 2025-26, consider the following statements: 1. It calls for the state to act before certainty emerges rather than wait for it. 2. It seeks to structure risk rather than avoid it. 3. It emphasises systematic learning from experimentation. 4. It proposes replacing private markets with state-led production in strategic sectors. Which of the above is/are correctly identified?

1. It calls for the state to act before certainty emerges rather than wait for it.
2. It seeks to structure risk rather than avoid it.
3. It emphasises systematic learning from experimentation.
4. It proposes replacing private markets with state-led production in strategic sectors.

• A. 1 and 2 only
• B. 3 and 4 only
• C. 1, 2 and 3 only
• D. 1, 2, 3 and 4

Q5. With reference to the Economic Survey 2025-26, which one of the following best describes the concept of an 'Entrepreneurial State'?

• A. A state that withdraws from economic activity and confines itself to regulation of private enterprise
• B. A state that acts before certainty emerges, structures risk rather than avoids it, and learns systematically from experimentation
• C. A state that owns and operates the commanding heights of the economy through public sector undertakings
• D. A state that guarantees a universal basic income to all citizens irrespective of employment status

Q6. With reference to the relative offers made by India and the European Union under the India–EU FTA (2026), consider the following statements: 1. The EU's tariff concessions to India cover a larger share of bilateral trade value than India's reciprocal tariff concessions to the EU. 2. India alone has excluded dairy products from tariff liberalisation, whereas the EU has made no such exclusion of dairy under the Agreement. 3. The Agreement was concluded exclusively between India and the European Commission, with no participation of any EU member state's head of government or state. Which of the statements given above is/are correct?

1. The EU's tariff concessions to India cover a larger share of bilateral trade value than India's reciprocal tariff concessions to the EU.
2. India alone has excluded dairy products from tariff liberalisation, whereas the EU has made no such exclusion of dairy under the Agreement.
3. The Agreement was concluded exclusively between India and the European Commission, with no participation of any EU member state's head of government or state.

• A. 1 only
• B. 1 and 2 only
• C. 2 and 3 only
• D. 1, 2 and 3

Q7. Under the India–EU Free Trade Agreement, India has placed a significant share of its tariff lines under phased tariff elimination. What is the longest phase-in period (in years) over which India's tariff elimination is staggered under the Agreement?

• A. 5 years
• B. 7 years
• C. 10 years
• D. 15 years

Q8. Which one of the following is the nodal ministry of the Government of India that negotiated and operationalises the India–European Union Free Trade Agreement concluded in 2026?

• A. Ministry of External Affairs
• B. Ministry of Commerce and Industry
• C. Ministry of Finance
• D. Ministry of Agriculture and Farmers' Welfare

Q9. Under India's Green Steel Taxonomy, the highest (Five-Star) green rating is awarded to steel plants whose CO2-equivalent emission intensity is below which one of the following thresholds (tonnes of CO2e per tonne of finished steel)?

• A. 1.0
• B. 1.6
• C. 2.0
• D. 2.2

Q10. With reference to the emission-accounting boundary defined in India's Green Steel Taxonomy (2024), consider the following: 1. Scope-1 direct emissions of the steel plant 2. Scope-2 emissions from purchased electricity 3. Embodied emissions in purchased raw materials and intermediary products 4. Upstream emissions from iron-ore mining Which of the above are correctly identified as items included within the taxonomy's emission scope?

1. Scope-1 direct emissions of the steel plant
2. Scope-2 emissions from purchased electricity
3. Embodied emissions in purchased raw materials and intermediary products
4. Upstream emissions from iron-ore mining

• A. 1 and 2 only
• B. 1, 2 and 3 only
• C. 2, 3 and 4 only
• D. 1, 2, 3 and 4

Q11. How many Task Forces did the Ministry of Steel constitute in February 2025 to recommend measures across the steel-industry decarbonisation chain (covering levers such as energy efficiency, green hydrogen, CCUS and biochar)?

• A. 9
• B. 11
• C. 14
• D. 17

Q12. With reference to India's Green Steel Taxonomy, which one of the following has been designated as the nodal agency for Measurement, Reporting and Verification (MRV) and for issuing greenness certificates and star ratings to steel producers?

• A. Bureau of Energy Efficiency (BEE)
• B. Joint Plant Committee (JPC)
• C. National Institute of Secondary Steel Technology (NISST)
• D. Steel Research and Technology Mission of India (SRTMI)

Q13. In the Economic Survey 2025-26's discussion of India's shift toward value-driven pharmaceutical manufacturing, a 'biosimilar' is best described as which one of the following?

• A. A chemically synthesised generic version of a small-molecule drug whose patent has expired
• B. A biological product highly similar to an already-approved reference biologic, with no clinically meaningful differences in safety and efficacy
• C. A wholly novel biologic molecule protected by a fresh product patent
• D. A single-dose combination of two or more off-patent active pharmaceutical ingredients

Q14. The National Medical Devices Promotion Council (NMDPC), set up to promote the domestic medical device industry, functions under the chairpersonship of which one of the following?

• A. Secretary, Department of Pharmaceuticals
• B. Secretary, Department of Health and Family Welfare
• C. Director General, Central Drugs Standard Control Organisation
• D. Secretary, Department for Promotion of Industry and Internal Trade

Q15. The Production Linked Incentive (PLI) Scheme for Medical Devices, which supports domestic manufacturing of high-end equipment, provides incentives over which one of the following periods?

• A. 2020-21 to 2027-28
• B. 2020-21 onwards, on a perpetual basis with no terminal year
• C. 2015-16 to 2022-23
• D. 2022-23 to 2030-31

Q16. At the central level, the pharmaceutical industry — including its export-oriented PLI incentives and industrial policy — is administered primarily by which one of the following?

• A. Department of Health and Family Welfare, Ministry of Health and Family Welfare
• B. Department of Pharmaceuticals, Ministry of Chemicals and Fertilizers
• C. Department of Commerce, Ministry of Commerce and Industry
• D. Department for Promotion of Industry and Internal Trade, Ministry of Commerce and Industry

Q17. With reference to India's pharmaceutical export standing as highlighted in the Economic Survey 2025-26, which one of the following statements is NOT correct?

1. India is the third-largest producer of pharmaceuticals in the world by volume.
2. India ranks 11th globally in pharmaceutical exports by value.
3. India meets roughly 20% of global generic medicine demand by volume.
4. About 50% of India's pharmaceutical exports are directed to less-regulated African markets.

• A. 1 and 2
• B. 3 only
• C. 4 only
• D. 2 and 3

Q18. In the context of the PLI Scheme for Bulk Drugs, the term 'Key Starting Materials (KSMs)' most precisely refers to which one of the following?

• A. Finished formulations packaged for retail sale under generic brand labels
• B. The essential chemical raw materials from which drug intermediates and active pharmaceutical ingredients are synthesised
• C. The biological reference products against which the similarity of a biosimilar is established
• D. The inert excipients added to a formulation to stabilise its shelf life

Q19. With reference to the Public Financial Management System (PFMS) used in compiling Union Government accounts, consider the following statements: 1. PFMS is developed and implemented by the Office of the Controller General of Accounts. 2. PFMS was started in 2009 as a Central Sector Scheme of the erstwhile Planning Commission. 3. In 2013 the scope of PFMS was enlarged to cover direct payments to beneficiaries. 4. PFMS is developed and maintained by the Reserve Bank of India. Which of the statements given above are correct?

1. PFMS is developed and implemented by the Office of the Controller General of Accounts.
2. PFMS was started in 2009 as a Central Sector Scheme of the erstwhile Planning Commission.
3. In 2013 the scope of PFMS was enlarged to cover direct payments to beneficiaries.
4. PFMS is developed and maintained by the Reserve Bank of India.

• A. 1, 2 and 3
• B. 1 and 4 only
• C. 2 and 4 only
• D. 1, 3 and 4

Q20. The statutory glide-path for containing the Union Government's fiscal deficit, against which the CGA monthly accounts are tracked, is mandated under which one of the following?

• A. Fiscal Responsibility and Budget Management Act, 2003
• B. Fiscal Responsibility Act, 2000
• C. Public Debt Act, 1944
• D. Government Securities Act, 2006

Q21. With reference to the fiscal-deficit framework relevant to the CGA monthly accounts for FY 2025-26, consider the following statements: 1. The fiscal deficit target for FY 2025-26 was set at 4.4% of GDP. 2. This target was lower than the revised estimate of 4.8% of GDP for FY 2024-25. 3. From FY 2026-27, the government has moved to a debt-to-GDP ratio as its fiscal anchor. 4. The fiscal deficit target for FY 2025-26 was set at 5.1% of GDP. Which of the statements given above are correct?

1. The fiscal deficit target for FY 2025-26 was set at 4.4% of GDP.
2. This target was lower than the revised estimate of 4.8% of GDP for FY 2024-25.
3. From FY 2026-27, the government has moved to a debt-to-GDP ratio as its fiscal anchor.
4. The fiscal deficit target for FY 2025-26 was set at 5.1% of GDP.

• A. 1, 2 and 3
• B. 1 and 4 only
• C. 2 and 3 only
• D. 1, 3 and 4

Q22. With reference to tax devolution to States around the period of the CGA Monthly Review upto December 2025, which of the following statements are correct? 1. The 16th Finance Commission recommended retaining the vertical share of devolution at 41% of the divisible pool. 2. The 16th Finance Commission submitted its report to the President in November 2025. 3. Devolution to States upto December 2025 was higher by ₹1,37,014 crore than in the corresponding period of FY 2024-25. 4. The 16th Finance Commission recommended raising the vertical share of devolution to 42%. Which of the above is/are correctly identified?

1. The 16th Finance Commission recommended retaining the vertical share of devolution at 41% of the divisible pool.
2. The 16th Finance Commission submitted its report to the President in November 2025.
3. Devolution to States upto December 2025 was higher by ₹1,37,014 crore than in the corresponding period of FY 2024-25.
4. The 16th Finance Commission recommended raising the vertical share of devolution to 42%.

• A. 1, 2 and 3
• B. 1 and 4 only
• C. 2, 3 and 4
• D. 1, 3 and 4

Q23. The periodic release of tax devolution installments to State Governments, as reflected in the CGA monthly accounts, is operationalised by which one of the following?

• A. Ministry of Finance, Government of India
• B. The Finance Commission
• C. NITI Aayog
• D. The Reserve Bank of India's State Finances Division

Q24. According to the CGA Monthly Review of Accounts upto December 2025 (FY 2025-26), the total expenditure of ₹33,80,998 crore constituted what percentage of the corresponding Budget Estimates 2025-26?

• A. 66.7%
• B. 72.2%
• C. 62.7%
• D. 76.7%

Q25. In the CGA Monthly Review of Accounts upto December 2025 (FY 2025-26), which of the following are correctly identified as items booked under the Revenue Account of Union Government expenditure? 1. Interest Payments 2. Major Subsidies 3. Capital Account outgo of ₹7,87,935 crore 4. Creation of capital assets through direct capital expenditure Which of the above is/are correctly identified?

1. Interest Payments
2. Major Subsidies
3. Capital Account outgo of ₹7,87,935 crore
4. Creation of capital assets through direct capital expenditure

• A. 1 and 2 only
• B. 2 and 3 only
• C. 1, 2 and 4
• D. 3 and 4 only

Q26. With reference to the composition of receipts in the CGA Monthly Review of Accounts upto December 2025 (FY 2025-26), consider the following statements: 1. Total receipts realised were 72.2% of the corresponding Budget Estimates 2025-26. 2. Non-Tax Revenue realised was higher than Non-Debt Capital Receipts realised. 3. Non-Debt Capital Receipts formed the largest single component of total receipts. Which of the statements given above is/are correct?

1. Total receipts realised were 72.2% of the corresponding Budget Estimates 2025-26.
2. Non-Tax Revenue realised was higher than Non-Debt Capital Receipts realised.
3. Non-Debt Capital Receipts formed the largest single component of total receipts.

• A. 1 and 2 only
• B. 2 and 3 only
• C. 1 and 3 only
• D. 1, 2 and 3

Q27. As per the CGA Monthly Review of Accounts upto December 2025 (FY 2025-26), which one of the following was the single largest component of the Government of India's total receipts?

• A. Tax Revenue (Net to Centre)
• B. Non-Tax Revenue
• C. Non-Debt Capital Receipts
• D. Recoveries of loans and advances

Q28. With reference to the institutional support ecosystem associated with Regional Rural Banks, which of the statements given above is/are correctly identified?

1. NABARD provides refinance support to RRBs.
2. SIDBI is associated with MSME-related refinance support within the RRB ecosystem.
3. Sponsor Public Sector Banks provide operational and technology support to RRBs.
4. RRBs are supervised entirely by SIDBI.

• A. 1 and 4 only
• B. 2 and 3 only
• C. 1, 2 and 3 only
• D. 1, 2, 3 and 4

Q29. In the classification of banks maintained by the Reserve Bank of India, Regional Rural Banks are categorised as which one of the following?

• A. Scheduled Commercial Banks
• B. Urban Co-operative Banks
• C. Payments Banks
• D. Primary Agricultural Credit Societies

Q30. With reference to the current network footprint of Regional Rural Banks after the fourth phase of amalgamation, which of the statements given above is/are correct?

1. A total of 28 RRBs are in operation.
2. They operate across 26 States and 3 Union Territories.
3. They function through 22,158 branches.
4. They cover only about 250 districts.

• A. 1, 2 and 3 only
• B. 2 and 4 only
• C. 1 and 4 only
• D. 1, 2, 3 and 4