1. What explains banks' cautious stance when lending to NBFCs?
Answer: E. Because stress on assets is mounting, particularly among microfinance institutions, banks restrict exposure to highly rated NBFCs and avoid risk.
2. Why has the Centre suggested lowering states' share of taxes from 41% to 40%?
Answer: C. Trimming the states' portion could yield about ₹350 billion for central spending, although the move may meet political resistance.
3. What is the principal fear of southern states about the coming delimitation exercise?
Answer: D. Since delimitation follows population and the south has grown more slowly than the north, these states expect to lose Lok Sabha seats in the 2026 exercise.
4. Why does the IMF advise India to lower its fiscal deficit to 3% of GDP?
Answer: B. The IMF expects a smaller deficit to steady finances, draw investment, bring India in line with global fiscal norms and lessen debt risks.
5. According to government policy, what does India's debt strategy seek to achieve?
Answer: A. The plan is to bring the debt-to-GDP ratio down from 57.1% in FY25 to 50% by FY31 through stable, long-term domestic borrowing.
6. What is a central issue in India-EU relations?
Answer: C. The EU treats India as a strategic partner but has voiced concerns about human rights, free speech and minority rights, which create diplomatic friction.
7. What is a likely result of Trump's proposed 25% tariff on EU imports?
Answer: E. The European Union has cautioned that it would retaliate against the proposed tariffs, which could heighten trade tensions.
8. What defines Trump's 'Gold Card' immigration plan?
Answer: B. Under the proposal, wealthy investors and top graduates could obtain green card benefits by investing $5 million, and it would take the place of the EB-5 visa programme.
9. What lies behind EPFO subscribers' call for a higher interest rate on PF accounts?
Answer: A. With the current PF rate at 8.25%, workers want more because inflation is lowering the real value of their savings.
10. Why does Russia refuse to negotiate over the Ukrainian regions it has annexed?
Answer: D. Moscow rules out talks on Crimea (2014) and the areas annexed in 2022, calling them inseparable parts of Russia, which sustains tension with Ukraine and the West.