Question Discussion & Solution

The Issue Department of the RBI:

• The Issue Department is concerned with the proper and efficient management of the note issue.
• For the conduct of monetary transactions, the country has been divided into 14 circles of issue, each having an Office of Issue — the branch of the Issue Department.
• Each branch of the Issue Department consists of: (i) the General Department and (ii) the Cash Department, controlled by the currency officer.
  • The General Department deals with resource operations, i.e., arrangement of supply of notes and coins from the presses and Government Mints.
  • The Cash Department deals with cash transactions.
• ​The RBI Offices, where Issue Department is functioning, offer the facility to members of the public to exchange their notes including soiled and mutilated notes and coins including uncurrent or worn-out coins.
• The Bank is committed to providing exchange facilities free of cost at its counters during business hours.
• The Issue Department of the RBI maintains a Minimum Reserve System against the printing of notes.
• Under the Minimum Reserve System, the RBI has to maintain a minimum reserve of Rs. 200 crores, Rs. 115 crores should be in the form of gold coins and the rest in the form of foreign currencies.
• After maintaining the minimum reserve, the RBI can print any number of currency notes as per the requirement of the economy, except one rupee note.
• Since the one rupee note is issued by the Ministry of Finance but is distributed by the RBI through commercial banks. 

Therefore, the Issue Department of the RBI maintains a Minimum Reserve System against the printing of notes.

The correct answer is Inflation.

Key Points

• Inflation:
  • ​Inflation is an increase in the level of prices of the goods and services that households buy.
  • It is measured as the rate of change of those prices.
  • The well-known indicator of inflation is the Consumer Price Index (CPI), which measures the percentage change in the price of a basket of goods and services consumed by households.
  • Inflation refers to the increase in the prices of the goods and services of daily use, such as food, housing, clothing, transport, recreation, consumer staples, etc.
  • Inflation is calculated in India by the Ministry of Statistics and Program Implementation.

Additional Information

• Deflation: 
  • ​It is also called negative inflation.
  • During a deflationary period, prices fall in the same way as they arise in the case of inflation: continuously and in a generalized manner.
• Stagflation:
  • ​Stagflation is the extreme economic situation, a peculiar combination of stagnant growth and rising inflation leading to high unemployment.
  • Causes of Stagflation:
    • ​Government expansion of the money supply.
    • Decreasing level of Productivity.
    • Supply-side shock.
    • Increasing structural Unemployment.
    • Central bank raising Interest rates.
    • A sudden increase in oil prices.
  • Hyperinflation:​
    • It is the situation when the price of goods and services rises uncontrollably over a definite time period.
    • It is also called Rapid Inflation.

The correct answer is Mycem Cement Factory - Katani.

Key Points

• Mycem Cement Factory is situated in Damoh.
  • It was established in 2013.
  • It is a subsidiary of Heidelberg cement of Germany.
• National Newsprint and Paper Mill are situated in Nepanagar, Burahnpur, Madhya Pradesh.
  • It was established in 1948.
  • It is India's first newspaper printing mill.
• Security Paper Mill is situated in Hoshangabad.
  • It was established in 1968.
  • Stamp paper, postal tickets, and currency notepaper are manufactured here.
  • It is under the control of the Ministry of Finance, Government of India.
• Tissue Paper Mill is situated in Indore.
• Kaimur factory is situated in Katani.
  • It was established in 1923.
  • This factory is operated under ACC cement company.

The correct answer is 2 only.

Key Points

• Indian Agriculture:
  • ​The share of agriculture in the gross domestic product (GDP) has reached almost 20 per cent for the first time in the last 17 years, making it the sole bright spot in GDP performance during 2020-21, according to the Economic Survey 2020-2021.​ Hence statement 1 is not correct.
  • The resilience of the farming community in the face of adversities made agriculture the only sector to have clocked a positive growth of 3.4 per cent at constant prices in 2020-21 when other sectors slid.
  • The share of agriculture in GDP increased to 19.9 per cent in 2020-21 from 17.8 per cent in 2019-20. The last time the contribution of the agriculture sector in GDP was at 20 per cent was in 2003-04.
• Dependence on monsoon:
  • Reliance on seasonal rainfall hampers productivity. Additionally, change in climatic conditions and erratic weather patterns such as cyclones and droughts can impact the yields of agricultural crops.
  • The growth of India’s agriculture sector has been dependent on monsoons, and as a result, it has been volatile. Hence statement 1 is correct.
  • The government is now encouraging micro-irrigation to improve water usage/efficiency.
• Government initiatives:
  • Improve soil fertility on a sustainable basis through the soil health card scheme.
  • Provide improved access to irrigation and enhanced water efficiency through Pradhan Mantri Krishi Sinchai Yojana (PMKSY).
  • Support organic farming through Paramparagat Krishi VikasYojana (PKVY).
  • Creation of a unified national agriculture market to boost the income of farmers.
  • To mitigate risk in the agriculture sector, “Pradhan Mantri Fasal BimaYojana (PMFBY) has been launched for implementation from Kharif 2016.

The correct answer is 2017.

Key Points

• Madhya Pradesh Industrial Development Corporation Limited(MPIDC) is the Single Window Secretariat for Investment Promotion and Facilitation of the state.
• MPIDC has launched an Integrated New Venture Establishment Portal (INVEST), which is the Single Window Portal for the state. 
• INVEST Portal is being developed for monitoring of entire life cycle of investment projects, right from receipt of the ‘Intention to Invest’ to grounding and completion.
• INVEST is acting as a one-stop solution for any investor wanting to establish & operate a business in the state.
• Now investors would not be required to visit different state department portals, rather they can avail various services/approvals required for setting up their business through INVEST Portal.
• The portal ensures time-bound delivery of facilities and permissions through continuous review/monitoring.
• The development of INVEST Portal started in April 2017.
• Department of Industrial Policy and Investment Promotion, the Government of Madhya Pradesh is responsible for the all-around industrial development of the State.
• The department facilitates the establishment of industries to achieve employment generation and utilization of local resources.
• The department acts as a catalyst to modernize and strengthen industries of the State to make them globally competitive. 
• INVEST Portal, which is being developed by DIP&IP to works as an Investor lifecycle tool, will also cover MSME units