QUESTIONS

1. With reference to Banning of 4. World Economic Outlook is published

Unregulated Deposits Scheme by:
Act, 2019, consider the following (a) International Monetary Fund
statements:
(b) World Economic Forum
1. It provides for a single regulator to oversee
(c) World Bank
various deposit-taking schemes in India.
2. Fraudulent default in a regulated deposit (d) None of the above
scheme is an offense as per the act.
Which of the above statements is/are correct? 5. Consider the following statements
regarding Direct Tax Code (DTC):
(a) 1 only
1. It is an attempt by the Government of

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(b) 2 only India (GOI) to simplify the direct tax laws
(c) Both 1 and 2 in India.

(d) Neither 1 nor 2 2. It will replace the Income-tax Act, 1961

(ITA) only.

2. Consider the following statements O Which of the above statements is/are correct?
regarding the recently announced (a) 1 only
National Manufacturing Policy: (b) 2 only
1. It aims to enhance the technological depth (c) Both 1 and 2
and environmental sustainability of growth
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in the manufacturing sector. (d) Neither 1 nor 2

2. At least 30% of the total land area

proposed for the National Investment 6. Global Innovation Index is published
and Manufacturing Zones (NIMZs) will by:
be utilized for location of manufacturing
(a) World Economic Forum
units.
Human Development Innovation Fund
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(b)
3. The Department for Promotion of Industry
and Internal Trade is the nodal agency for (c) United Nations Conference on Trade and
NIMZ. Development
Which of the above statements is/are correct? (d) World Intellectual Property Organization
(a) 1 only
(b) 1 and 2 only
7. Which one of the following is a Legacy
Dispute Resolution scheme which is
(c) 2 and 3 only
offered to those taxpayers who wish
(d) 1, 2 and 3 only to disclose any previously undisclosed
tax liability without any penalty or
3. CAFE Regulations, seen recently in prosecution?
news, is related with: (a) Sabka Vishwas Scheme
(a) Climate mitigation strategies
(b) KALIA Scheme
(b) Automobile sector
(c) PAHAL Scheme
(c) Food processing sector
(d) Pandit Deendayal Upadhyay Shramev
(d) Export promotion policy Jayate Yojana

3 P2020_CRCA_500/D29
8. Which of the following statements is/ Which of the above statements is/are correct?
are correct as per Bimal Jalan Panels’ (a) 1 only
recommendation to review RBI’s
(b) 2 only
Economic Capital Framework?
(c) Both 1 and 2
1. RBI has to maintain the contingency risk
buffer to handle the financial stability in (d) Neither 1 nor 2
the country.
2. It recommended a review of RBI’s Economic 10. Consider the following Statements
Capital Framework in every five years.
regarding Open Acreage Licensing
Select the correct answer using the code given
Policy (OALP)
below:
1. It gives an option to a company looking
(a) 1 only
for exploring hydrocarbons to select the
(b) 2 only exploration blocks on its own, without
(c) Both 1 and 2 waiting for the formal bid round from the
Government.
Neither 1 nor 2

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(d)
2. Setting up of National Data Repository is
one of the milestones achieved for Open
9. Consider the following statements Acreage Licensing Policy.
regarding the World Skills
Which of the above statements is/are correct?
Competition:
1. The 45th World Skills Competition was held (a) 1 only
at New Delhi, India.
O (b) 2 only
2. It is the biggest vocational education and
(c) Both 1 and 2
skills excellence event in the world which is
organised every two year. (d) Neither 1 nor 2
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P2020_CRCA_500/D29 4
 ANSWER HINTS
Answer Key
Q. 1 (b) Q. 3 (b) Q. 5
Q. 2 (d) Q. 4 (a) Q. 6
1. Correct Option: (b)
Explanation:
 Statement 1 is incorrect: Nine regulators
mentioned in Schedule 1 of the act oversee
and regulate various deposit-taking schemes.
Supplementary notes:
Banning of Unregulated Deposits Scheme
Act, 2019
O 2. Correct Option: (d)
 It provides for a mechanism to ban unregulated
deposit schemes and protect the interests of
depositors.
SC
 The act defines a deposit as an amount of
money received through an advance, a loan,
or in any other form, with a promise to be
returned with or without interest. Such
deposit may be returned either in cash or as
a service, and the time of return may or may
not be specified.
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 A deposit-taking scheme is defined as
unregulated if it is taken for a business purpose
and is not registered with the regulators (like
RBI for NBFCs, SEBI for mutual funds, central
and state governments for chit funds) listed
in the Bill.
 All deposit-taking schemes are required to be
registered with the relevant regulator.
 The Bill provides for the appointment of
one or more government officers, not below
the rank of Secretary to the state or central
government, as the Competent Authority who
will have the powers of a civil court.
 It provides for the central government to
designate an authority to create an online
central database for information on deposit
takers. All deposit takers will be required
to inform the database authority about
their business. The Competent Authority
P2020_CRCA_500/D29
(a) Q. 7 (a) Q. 9 (b)
(d) Q. 8 (c) Q. 10 (c)
will be required to share all information on
unregulated deposits with the authority.
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 There are three different types of offences—
running of unregulated deposit schemes,
fraudulent default in regulated deposit
schemes, and wrongful inducement in case
of unregulated deposit schemes, according
to the bill.
Explanation:
All statements are correct

Supplementary notes:
National Manufacturing Policy
 The Government of India has announced
a National Manufacturing Policy with
the objective of enhancing the share of
manufacturing in GDP to 25% within a decade
and creating 100 million jobs.
 At least 30% of the total land area proposed
for the NIMZ will be utilized for location of
manufacturing units.
 The major objectives of the National
Manufacturing Policy are to increase the
sectoral share of manufacturing in GOP to
at least 25% by 2022; to increase the rate
of job creation so as to create 100 million
additional jobs by 2022; and to enhance global
competitiveness, domestic value addition,
technological depth and environmental
sustainability of growth.
 The policy envisages specific interventions
broadly in the areas of industrial infrastructure
development; improvement of the business
environment through rationalization and
simplification of business regulations;
development of appropriate technologies
6
 especially green technologies for sustainable
development and skill development of the
younger population.
 Industrial infrastructure development is
envisaged through the creation of large
integrated industrial townships called National
Investment and Manufacturing Zones (NIMZs)
with state-of-the-art infrastructure.
 The NIMZs are envisaged as integrated industrial
townships with state of the art infrastructure;
land use on the basis of zoning; clean and
energy efficient technology; necessary social
infrastructure; skill development facilities
etc. to provide a productive environment for
persons transitioning from the primary to the
secondary and tertiary sectors.
 The policy is based on the principle of industrial
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growth in partnership with the States.
 The Central Government will create the
enabling policy frame work, provide incentives
for infrastructure development on a Public
Private Partnership (PPP) basis through
appropriate financing instruments.
 The State Government will constitute a
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Special Purpose Vehicle (SPV) to discharge the
functions specified in the policy.
4. Correct Option: (a)
The Department for Promotion of Industry
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and Internal Trade (former DIPP) is the
nodal agency for NIMZ.
 For the internal infrastructure in a NIMZ, the
government will provide:
 Viability Gap Funding (VGF): The total
Viability Gap Funding under this scheme
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shall not exceed twenty percent of the
total project cost.
 Long term soft loans from multilateral
financial institutions: Soft loans from
multilateral institutions will be explored
for funding infrastructure development in
NIMZ.
 External Commercial Borrowings will be
allowed
3. Correct Option: (b)
Explanation:
 Option (b) is correct: CAFÉ Regulations are
related with automobile sector.
Supplementary notes:
Corporate Average Fuel Efficiency/Economy
Regulations (CAFE Regulations)
7 P2020_CRCA_500/D29
 While the government is looking to advance
the 2030 deadline for Indian manufacturers to
switch over to electric vehicles in segments such
as bikes and three-wheelers, manufacturers are
opposing it. They instead want government to
curb the vehicular pollution through stricter
CAFE Regulations.
 They aim at lowering fuel consumption (or
improving fuel efficiency) of vehicles by
lowering carbon dioxide (CO2) emissions,
thus serving the twin purposes of reducing
dependence on oil for fuel and controlling
pollution.
 Corporate Average refers to sales-volume
weighted average for every auto manufacturer.
The norms are applicable for petrol, diesel,
LPG and CNG passenger vehicles.
 CAFE regulations in India came into force from
April 1, 2017. Under this, average corporate
CO2 emission must be less than 130 gm
per km till 2022 and below 113 gm per km
thereafter.
 CAFE norms require cars to be 30% or more
fuel efficient from 2022 and 10% or more
between 2017 and 2021.
Explanation:
 Option (a) is correct
Supplementary notes:
World Economic Outlook
 International Monetary Fund (IMF) in its
update to World Economic Outlook in July
has predicted a sluggish global growth.
 Global growth is forecast at 3.2 percent
in 2019, picking up to 3.5 percent in
2020
 Consistent with subdued growth in final
demand, core inflation across advanced
economies has softened below target
 Emerging and developing Asia is expected
to grow at 6.2 percent in 2019–20.
 In China, the negative effects of escalating
tariffs and weakening external demand have
added pressure to an economy already in the
midst of a structural slowdown and needed
regulatory strengthening to rein in high
dependence on debt.
 India’s economy is set to grow at 7.0 percent
in 2019, picking up to 7.2 percent in 2020. The
downward revision of 0.3 percentage point for
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P2020_CRCA_500/D29
 both years reflects a weaker-than-expected
outlook for domestic demand.
 However, India will still be the fastest growing
economy of the world (among the major
economies) much ahead of China.
 Reserve Bank of India (RBI), the Economic
Survey and the Asian Development Bank have
also cut their growth outlook for India to 7%.
5. Correct Option: (a)
Explanation:
 Statement 2 is incorrect: It will replace the
Income-tax Act, 1961 (ITA), and other direct
tax legislations like the Wealth Tax Act, 1957.
Supplementary notes:
creative outputs (78th), it lost one, two and
three spots respectively.
 According to WIPO India’s improvement
in the year 2019 is largely due to its relative
performance and less so to new GII data or
methods.
 India is consistently among the top in
the world in innovation drivers such as
ICT services exports, Graduates in science &
engineering, the quality of universities, Gross
capital formation—a measure of economy-
wide investments—and creative goods
exports.
India’s Strengths India’s Weaknesses
(Ranking in 2019) (Ranking in 2019)

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ICT services exports (1) Environmental
Direct Tax Code
Performance (125)
 The Direct Taxes Code (DTC) is an attempt
Domestic market scale Ecological
by the Government of India (GOI) to
(in $PPP) (3) Sustainability (117)
simplify the direct tax laws in India.
Growth rate of GDP/ Education (110)
 DTC will revise, consolidate and simplify the
worker (in $PPP) (4)
structure of direct tax laws in India into a
O
single legislation. Ease of protecting Tertiary Inbound
minority investors (6) Mobility (107)
 The DTC, when implemented will replace
the Income-tax Act, 1961 (ITA), and other Graduates in science ICT use (106)
direct tax legislations like the Wealth Tax and engineering (7)
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Act, 1957.
Global rankings Country
6. Correct Option: (d) 1 Switzerland
2 Sweden
Explanation:
3 USA
 Option (d) is correct
4 Netherlands
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Supplementary notes:
Global Innovation Index (GII)
 India improved its ranking in Global
Innovation Index, 2019 by five notches to
52nd position in a survey of innovative
capacity among 129 countries by the World
Intellectual Property Organization (WIPO).
 India also outperformed on innovation
relative to its GDP per capita for nine
consecutive years, only matched by three
other countries (Vietnam, Republic of
Moldova and Kenya).
 India improved its ranking in 4/7 pillars of GII,
such as knowledge and technology outputs
(up 11 spots to 32nd), market sophistication
(up 3 spots to 33rd), human capital and
research (up 3 spots to 53rd), institutions
(up 3 spots to 77th). By contrast, in business
sophistication (65th), infrastructure (79th),
5 UK
52 India
7. Correct Option: (a)
Explanation:
 Option (a) is correct: Sabka Vishwas Scheme
is a Legacy Dispute Resolution scheme is
offered to those taxpayers who wish to disclose
any previously undisclosed tax liability without
any penalty or prosecution.
Supplementary notes:
Sabka Vishwas Scheme
 The scheme targets those taxpayers who want
to close their pending disputes related to
Service Tax and Excise Tax (now subsumed
under Goods and Services Tax).

9 P2020_CRCA_500/D29
  The two main components of the Scheme
are dispute resolution and amnesty.
 The dispute resolution component is
aimed at liquidating the legacy cases of
Central Excise and Service Tax that are
subsumed in GST and are pending in
litigation at various forums.
 The amnesty component of the Scheme
offers an opportunity to the taxpayers to
pay the outstanding tax and be free of
any other consequence under the law. The
most attractive aspect of the Scheme is that
it provides substantial relief in the tax dues
for all categories of cases as well as full
waiver of interest, fine, penalty, In all these
cases, there would be no other liability
of interest, fine or penalty. There is also a
complete amnesty from prosecution.
 The Scheme is especially tailored to free the
large number of small taxpayers of their
pending disputes with the tax administration.
8. Correct Option: (c)
Explanation:
O 
 Both statements are correct
Supplementary notes:
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RBI Economic Capital Framework
 Recently, the Reserve Bank of India
(RBI) accepted the recommendations
of Bimal Jalan panel; set up to review the
RBI’s Economic Capital Framework.
 Following these recommendations, RBI decided
to transfer Rs 1.76 lakh crore in dividend and
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surplus reserves to the government.
 The objective of the economic capital
framework is to build harmony between
the central bank’s need for autonomy and
the Government’s objectives of the
development.
 The Bimal Jalan-led panel
recommended holistic risk capital
frameworks to assess the adequacy of RBI
reserves. Some recommendations of the
committee are:
 RBI to maintain the Contingency Risk
Buffer (CRB), which is the country’s
fund to handle financial stability within
the range of 5.5% to 6.5% of the RBI’s
balance sheet.
 It recommended a review of the
RBI’s Economic Capital Framework
(ECF) every five years.
P2020_CRCA_500/D29
 The RBI’s accounting year of July-June can
be brought in sync with the fiscal year of
April-March from the financial year 2020-
21.
 The report has also removed the interim
payout structure in general circumstances.
 All the recommendations of the panel
have been accepted by the RBI.
9. Correct Option: (b)
Explanation:
 Statement 1 is incorrect: The 45th WorldSkills
Competition were held at the KAZAN EXPO
International Exhibition Centre in Kazan,
Russia.
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Supplementary notes:
WorldSkills Competition
 The 45th WorldSkills Competition was
held at the KAZAN EXPO International
Exhibition Centre in Kazan, Russia.
It is a flagship event of the WorldSkills
International, organised every two years.
 It is the biggest vocational education and
skills excellence event in the world that
truly reflects global industry.
 The aims of the competition
include demonstrating the advantages of
learning a vocational skill, and encouraging
‘parity of esteem’ between vocational and
academic qualifications.
10. Correct Option: (c)
Explanation:
 Both statements are correct
Supplementary notes:
Open Acreage Licensing Policy (OALP)
 Open Acreage Licensing Policy (OALP)
gives an option to a company looking
for exploring hydrocarbons to select the
exploration blocks on its own, without
waiting for the formal bid round from the
Government.
 Under Open Acreage Licensing Policy (OALP),
a bidder intending to explore hydrocarbons
like oil and gas, coal bed methane, gas hydrate
etc., may apply to the Government seeking
exploration of any new block (not already
covered by exploration).
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  The Government will examine the Expression
of Interest and justification. If it is suitable for
award, Govt. will call for competitive bids after
obtaining necessary environmental and other
clearances.
 OALP was introduced vide a Cabinet decision
of the Government as part of the new fiscal
regime in exploration sector called HELP or
Hydrocarbon Exploration and Licensing Policy,
so as to enable a faster survey and coverage
of the available geographical area which has
potential for oil and gas discovery.
 What distinguishes OALP from New Exploration
and Licensing Policy (NELP) is that under OALP,
oil and gas acreages will be available round
the year instead of cyclic bidding rounds as in
NELP. Potential investors need not have to wait
for the bidding rounds to claim acreages.
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P2020_CRCA_500/D29
 Setting up of National Data Repository
is one of the milestones achieved for
Open Acreage Licensing Policy. To make
India a favorable destination globally for
Exploration of Crude Oil and Natural Gas,
the Government plans to move to the OALP
regime soon.
 It is well acknowledged that there is a need for
a faster vehicle of awarding blocks in order to
bring more area under exploration.
 As India has vast unexplored sedimentary
basins, a strategy which facilitates a time
bound full coverage has become a necessity.
Moreover, even the OALP pre-supposes
offering of data to the interested companies
for them to submit their bids/ interest. Hence,
availability of data is no longer an option, but
a pre-condition.
RE
12