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Question No. 257Interactive Test Mode
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Q257. Consider the following statements: 1. Most of India’s external debt is owed by governmental entities. 2. All of India’s external debt is denominated in US dollars. Which of the statements given above is/are correct?

Consider the following statements:

  1. Most of India’s external debt is owed by governmental entities.
  2. All of India’s external debt is denominated in US dollars.

Which of the statements given above is/are correct?

Select the correct option below (or cross out options to eliminate)

Official Answer Key & Detailed Solution

Ready to check the official UPSC Answer Key?

Click any option above to test yourself under exam conditions, or reveal the explanation directly.

Official UPSC Answer KeyUPSC Prelims 2019 • Indian Economy

Correct Answer: Option (D) — Neither 1 nor 2

Concept & Option Breakdown

Standard Reference Verified
  • Statement 1 is incorrect: The majority (around 80%) of India's external debt is owed by non-government entities (commercial borrowings, trade credit, NRI deposits), while the government's share is only around 20%.
  • Statement 2 is incorrect: While the US Dollar accounts for the largest share (over 50%), India's external debt is also denominated in Indian Rupees, Special Drawing Rights (SDR), Japanese Yen, Euros, and other currencies.
Elimination Heuristic & Exam Approach

Extreme qualifiers like 'All' and 'Most' in macro-financial statistics are frequently used by examiners to craft incorrect statements.

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Question Specifications & Syllabus Mapping

Examination & YearUPSC Civil Services Preliminary Examination 2019 (Q257)
Paper & Marking SchemeGS Paper I • 2 Marks (-0.66 Negative for incorrect response)
Syllabus Subject & TopicIndian Economy → Indian Economic Planning & Growth
Official Answer KeyOption (D) — Neither 1 nor 2

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Frequently Asked Questions — UPSC Prelims 2019 Q257

What is the official answer for UPSC Prelims 2019 GS Paper I Question 257 (Indian Economy)?

The official UPSC answer key for this 2019 Indian Economy (Indian Economic Planning & Growth) question is Option (D): "Neither 1 nor 2". Correct attempts carry 2 Marks with -0.66 Negative penalty for wrong answers.

Which UPSC Prelims syllabus topic does this 2019 question belong to?

This question belongs to GS Paper I under the subject "Indian Economy" and micro-topic "Indian Economic Planning & Growth". You can explore all repeated questions from Indian Economic Planning & Growth in Acme AI's 3D Prelims PYQ Realm or practice 50 full-length and sectional tests in the APT Prelims Test Series.

How can I solve this Indian Economic Planning & Growth UPSC Prelims question using option elimination?

Extreme qualifiers like 'All' and 'Most' in macrofinancial statistics are frequently used by examiners to craft incorrect statements.

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