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CDS 2024 · PYQ · Economy / International Trade · medium

If India enters into Free Trade Agreements (FTAs) with other nations, then the growth of exports of India would depend upon which of the following? 1. Extent of tariff reduction vis-à-vis MFN tariffs 2. Extent of relaxation in terms of rules of origin 3. Extent of relaxation in sanitary and phytosanitary measures 4. Level of infrastructure in India 5. Income in nations with which India enters into FTAs

  1. A.1, 3 and 4 only
  2. B.1, 2 and 4 only
  3. C.2, 3 and 5 only
  4. D.1, 2, 3, 4 and 5✓ Correct

Explanation

Export growth under a Free Trade Agreement depends on multiple interrelated factors. The depth of tariff cuts compared to most-favored-nation tariffs determines price competitiveness; relaxation in rules of origin determines how easily Indian exporters can claim preferential access; relaxation of sanitary and phytosanitary (SPS) standards enables agricultural and food exports; domestic infrastructure (ports, logistics, power) affects export costs and capacity; and the income levels of partner countries determine import demand. All five factors collectively shape India's export growth under FTAs, so the correct answer includes all of them.
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