agriculture sector subsidy & food processing section 10 Practice Questions Answers Test with Solutions & More Shortcuts
Agriculture Sector, Subsidy and Food Processing PRACTICE TEST [10 - EXERCISES]
agriculture sector subsidy & food processing section 1
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agriculture sector subsidy & food processing section 9
agriculture sector subsidy & food processing section 10
Question : 1
The term ‘under-recovery' was recently in the news, is related to which of the following?
a) Government giving exemptions on certain types of taxes
b) Government spending more on the subsidies than the budgeted amount
c) Cost incurred by PSU’s in providing subsidies
d) Central government getting less repayment on loans given to States
Answer »Answer: (c)
Let us understand with an example:
Suppose the imported LPG cylinder price (i.e. international market price) is Rs. 800/cylinder. And govt announced that it will give Rs. 300/cylinder as a subsidy through Direct Benefit Transfer (DBT).
So, the consumers will purchase the cylinder from Oil Marketing Companies (OMC) like IOCL/BPCL at Rs. 800/cylinder and government will transfer Rs. 300/cylinder in consumers account.
Now, if the international price increases to Rs. 900/cylinder, then there are three options:
- Consumers pay Rs. 900/cylinder and government transfer Rs. 400/cylinder in the account as DBT. But it will increase the overall subsidy bill of the government, which government don’t like
- Consumers pay Rs. 900/cylinder and the government still transfer Rs. 300/cylinder in consumers account, but it will increase the price per cylinder by Rs. 600 (=Rs. 900 - Rs. 300) to the consumer from the earlier price of Rs. 500 (=Rs. 800- Rs. 300). For political and social reasons, govt. may not like this also.
- Government forces OMCs (LPG cylinders are supplied through OMCs) to sell the cylinder still at Rs. 800/cylinder (a kind of forced regulation), So consumers pay Rs. 800/cylinder and they will get Rs. 300 in account from Govt. This will not increase govt. subsidy bill and consumers will also be happy. But it impacts the finances of OMCs.
If the government will choose the 3) option, then for OMCs it is a loss of Rs. 100/ cylinder. And this is called "Under-recovery" per cylinder.
Generally, because of political and social compulsions govt. uses this 3) option leading to huge under-recoveries by OMCs. Till the time price of crude/gas is benign/moderate, the under-recovery may be very less or nil but when it increases, the under-recovery of OMCs increases.
Question : 2
Rashtriya Krishi Vikas Yojna was launched in the year?
a) 2004
b) 2006
c) 2003
d) 2007
Answer »Answer: (d)
Rashtriya Krishi Vikas Yojana was launched in August 2007 as a part of the 11th Five Year Plan by the Government of India.
Launched under the aegis of the National Development Council, it seeks to achieve 4% annual growth in agriculture through the development of Agriculture and its allied sectors during the period under the 11th Five Year Plan (2007–11).
Question : 3
Consider the following statements :
- Coconut Palm Insurance Scheme (CPIS) is implemented in the Kerala, Karnataka and Tamil Nadu on Pilot basis.
- Coconut Palm Insurance Scheme (CPIS) was started since 2009-10.
a) 2 only
b) 1 only
c) Both 1 and 2
d) Neither 1 nor 2
Answer »Answer: (a)
A pilot Coconut Palm Insurance Scheme (CPIS) was introduced in 2009-10 for the benefit of coconut growers in major coconut growing states like Kerala, Karnataka, Tamilnadu, Goa, AP, West Bengal and Maharashtra.
In this scheme, coconut plants of the age from 4th year to 60th year are covered.
Insurance coverage is provided for total loss/death/becoming useless of the plant. Fifty per cent subsidy in premium is provided by the Government of India and twenty-five per cent by the concerned State Government.
Question : 5
In India, which of the following has the highest share in the disbursement of credit to agriculture and allied activities?
a) Co-operative Banks
b) Regional Rural Banks
c) Commercial Banks
d) Microfinance Institutions
Answer »Answer: (c)
In India, commercial banks have the highest share in the disbursement of credit to agriculture and allied activities.
The commercial banks disburse around 60% credit followed by cooperative banks around 30% and RRB and others.
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Agriculture Sector, Subsidy and Food Processing Shortcuts »
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indian economy MCQ CATEGORIES
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» Introduction to Indian Economy
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» Planning, Economic Development & Five year Plans
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» National Income & Human Development Index
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» Agriculture Sector, Subsidy and Food Processing
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» Industries, Manufacturing & Service Sectors
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» Inclusive growth, Sustainable development and employment
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» Poverty & Unemployment
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» Introduction to Micro Economics
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» Introduction to Macro Economics
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» Macro fundamentals, GDP, Investment, Growth
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» Demand & Supply, Profit Loss, Inflation & Price Index
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» Fiscal Policy, Public Finance and Monetary Policy
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» Money Supply, Banking and Financial Institutions
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» Taxes Types, Methods & Budgeting Process
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» Banking, Security Market & Insurance
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