UPSC Essentials brings to you its initiative of subject-wise quizzes. These quizzes are designed to help you revise some of the most important topics from the static part of the syllabus. Attempt today’s subject quiz on the Economy to check your progress. Click Here to read the UPSC Essentials magazine for October 2026. Share your views and suggestions in the comment box or at manas.srivastava@indianexpress.comWith reference to the Tariff Rate Quota (TRQ), consider the following statements:1. It is a mechanism that allows a set quantity of specific products to be exported.Which of the statements given above is/are correct?(a) 1 only(b) 2 only(c) Both 1 and 2(d) Neither 1 nor 2Relevance: The topic links with customs duties, agricultural trade, trade liberalisation and the World Trade Organisation (WTO) framework. It also helps understand how countries balance trade liberalisation with the protection of domestic farmers and producers.Explanation— India-New Zealand trade deal, which has secured full tariff elimination for all Indian exports to New Zealand while reducing tariffs on 95% of New Zealand’s imports into the country, came into effect. Under the pact, New Zealand has also committed to invest $20 billion in India over the next 15 years.— The sensitive sectors such as dairy, onions, chickpeas, peas, corn, almonds, artificial honey, and sugar have been kept out of the trade deal. The commerce ministry has also notified the procedure for allocation of Tariff Rate Quotas (TRQ) under the trade agreement. Goods under TRQ include apples, kiwi fruit, albumin and Manuka honey.Story continues below this ad— TRQ stands for Tariff Rate Quota. The TRQ is a mechanism that allows a set quantity of specific products to be imported. These specific items are as per the particular custom notification associated with it. Tariff quotas are used on a wide range of products, but most are in the agriculture sector. Cereals, meat, fruit and vegetables, and dairy products are the most common, and sugar is also protected in most producing countries. Hence, statement 1 is not correct and statement 2 is correct.Therefore, option (b) is the correct answer.(Other Source: content.dgft.gov.in)QUESTION 2With reference to services exports in India, consider the following statements:1. India’s services exports can be adversely affected by geopolitical conflicts that disrupt international travel and tourism.2. Rising energy prices amid geopolitical conflicts can increase airfares and reduce demand for international travel and tourism.Story continues below this adWhich one of the following is correct in respect of the above statements?(a) Both Statement 1 and Statement 2 are correct and Statement 2 is the correct explanation for Statement 1.(b) Both Statement 1 and Statement 2 are correct and Statement 2 is not the correct explanation for Statement 1.(c) Statement 1 is correct but Statement 2 is incorrect.(d) Statement 1 is incorrect but Statement 2 is correct.Relevance: India’s services exports are an important component of its balance of payments and external sector. The topic links with services exports, balance of payments, global economic interdependence and the impact of crude oil price fluctuations on the Indian economy.ExplanationStory continues below this ad— Driven by a nearly 50% jump in goods exports to the US amid worries about fresh tariffs on India over oil imports from Russia, India’s goods exports in September jumped 23% to $44.40 billion while services exports registered a rare dip, data released by the Commerce and Industry Ministry showed.— Data showed that India’s goods exports jumped 23% to $44.40 billion compared to $36.08 billion in September last year, and imports grew at a slower pace of 8% to 74.61 billion compared to $69.08 billion during last September. The slower pace of import growth helped the trade deficit marginally ease to $30.2 billion last month compared to $33 billion in September last year.— Amid continued uncertainty around the trade deal, India’s goods exports continue to register strong growth. As goods exports have been declining in the West Asia region, particularly in the UAE, Saudi Arabia, Kuwait and Iran, exports to the US ballooned by 48% in September, crossing $8 billion.— Geopolitical conflicts can disrupt international travel and tourism, affecting India’s travel-related services exports. Rising energy prices can increase aviation fuel costs and airfares, discouraging international travel and reducing demand for tourism services. This can adversely affect India’s services exports. Hence, statements 1 and 2 are correct.Story continues below this ad— Why Statement 2 explains Statement 1: Geopolitical conflicts can raise global energy prices, increasing aviation fuel costs and airfares. Higher travel costs may reduce international tourist arrivals and spending in India, thereby lowering travel and tourism receipts, which form part of India’s services exports.Therefore, option (a) is the correct answer.QUESTION 3With reference to the PM-KUSUM Scheme, consider the following statements:1. The scheme aims for de-dieselisation of the farm sector and enhancing the income of farmers.2. Under the Scheme, the central government gives a 100 per cent subsidy on the total cost of installing solar pumps.Which of the statements given above is/are correct?(a) 1 only(b) 2 only(c) Both 1 and 2(d) Neither 1 nor 2Story continues below this adRelevance: PM-KUSUM is an important government initiative linking agricultural development with renewable energy adoption. The scheme also connects with sustainable agriculture and India’s renewable energy transition.Explanation— The Centre is considering financial incentives to promote agri-photovoltaics which would allow solar power generation and farming to take place on the same land, as it looks to expand renewable energy capacity without compromising food security. The potential capacity for agri-photovoltaics in India is estimated at 1-2 terawatts (TW) or 1000-2000 gigawatts (GW), according to Santosh Kumar Sarangi, Secretary, Ministry of New and Renewable Energy (MNRE). Currently, India’s installed solar capacity stands at 171 GW.— However, the government is still examining whether the incentives could be provided under the existing PM-KUSUM scheme, which promotes solar energy in the agriculture sector, or through a standalone scheme.About PM-KUSUM Scheme— Pradhan Mantri Kisan Urja Suraksha evam Utthan Mahabhiyan (PM-KUSUM) Scheme for de-dieselisation of the farm sector and enhancing the income of farmers. Hence, statement 1 is correct.Story continues below this ad— Under the Scheme, central government subsidy upto 30% or 50% of the total cost is given for the installation of standalone solar pumps and also for the solarisation of existing grid-connected agricultural pumps. Hence, statement 2 is not correct.— Further, farmers can also install grid-connected solar power plants up to 2MW under the Scheme on their barren/fallow land and sell electricity to local DISCOM at a tariff determined by state regulator.— This scheme is being implemented by the designated departments of the State Government.Therefore, option (a) is the correct answer.(Other Source: pmkusum.mnre.gov.in)QUESTION 4The term ‘Strategic Disinvestment’ refers to:(a) Sale of a minority stake in a Central Public Sector Enterprise (CPSE) without transferring management control.Story continues below this ad(b) Transfer of management control of a CPSE to another government-owned enterprise without selling government shareholding.(c) Sale of government shareholding in a CPSE exclusively to another public sector enterprise while retaining management control.(d) Entire or substantial sale of Government shareholding of a Central Public Sector Enterprises (CPSEs) along with transfer of management control.Relevance: Strategic disinvestment is an important component of India’s public sector enterprise reforms and privatisation policy. It is relevant to the government’s approach to improving the efficiency of CPSEs, mobilising resources and reducing its role in commercial activities.Explanation— The government will continue pushing hard to sell stakes in public sector companies despite having met its target for the 2026-27 fiscal year following the Cabinet’s approval to the ‘strategic restructuring’ of IDBI Bank.— The Cabinet Committee on Economic Affairs announced Canada’s Fairfax Financial Holdings, backed by Indian-Canadian billionaire Prem Watsa, as the buyer of 60.72% stake in IDBI Bank for Rs 52,878 crore.— Strategic Disinvestment implies the entire or substantial sale of Government shareholding of a CPSE along with transfer of management control. In case of Privatization, which is a sub-set of strategic disinvestment, the Government equity in CPSE and its management control is transferred to a private strategic buyer(s) and in other cases of strategic disinvestment, the Govt. equity is transferred to another CPSE along with control.Therefore, option (d) is the correct answer.(Other Source: dipam.gov.in)QUESTION 5The term “Merey grade”, with reference to crude oil, is associated with:(a) Saudi Arabian Crude(b) West Texas Intermediate (WTI) Crude(c) Venezuelan Crude(d) Brent CrudeRelevance: Crude oil grades are classified based on properties such as density and sulphur content, which influence refining requirements and market value. The topic links with global crude oil benchmarks, international energy trade and the geographical distribution of petroleum resources.Explanation— The US wants India to buy more Venezuelan oil, particularly through Reliance Industries Ltd (RIL), which runs the world’s largest single-location refining complex in Gujarat’s Jamnagar. US Secretary of State Marco Rubio visited RIL’s Jamnagar mega refinery complex, and one of the items on the agenda of his meeting with RIL top brass was expanding India’s — and RIL’s — imports of Venezuelan oil, which is now under US oversight.— There are two major challenges to increasing Venezuelan crude imports: refining capacity and price competitiveness. Venezuela’s flagship Merey grade is extremely heavy and highly sulphurous. This makes Reliance’s sophisticated Jamnagar refining complex particularly well suited to processing it, but also limits the number of Indian facilities capable of handling large volumes. Venezuela has massive oil reserves but minuscule production— Economics is another obstacle. Although Merey is offered at a substantial discount of around $25 per barrel to (benchmark crude) Brent, freight to India’s west coast currently costs approximately $35 barrel. That effectively turns the discount into a landed premium…And with freight this expensive, transporting Venezuelan crude on vessels smaller than VLCCs (very large crude carriers) is hardly economicalTherefore, option (c) is the correct answer.Previous Daily Subject-Wise-QuizDaily Subject-wise quiz — History, Culture, and Social Issues (Week 166)Daily subject-wise quiz — Polity and Governance (Week 185)Daily subject-wise quiz — Science and Technology (Week 185)Daily subject-wise quiz — Economy (Week 184)Daily subject-wise quiz — Environment and Geography (Week 184)Daily subject-wise quiz – International Relations (Week 184)Subscribe to our UPSC newsletter and stay updated with the news cues from the past week.Stay updated with the latest UPSC articles by joining our Telegram channel – IndianExpress UPSC Hub, and follow us on Instagram and X