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Daily Current Affairs
28 February, 2025
1. Why are banks adopting a conservative approach towards lending to NBFCs?
A) Due to increasing asset stress in NBFCs and MFIs
B) To encourage more unsecured loans
C) To reduce competition in the lending sector
D) Because the RBI has increased lending limits
E) To boost the stock market
Answer: A) Due to increasing asset stress in NBFCs and MFIs
Explanation: Banks are limiting their exposure to only high-rated NBFCs due to mounting asset stress in the sector, especially in microfinance institutions, leading to high-risk aversion.
2. What is the main reason behind the Centre’s proposal to cut states’ tax share from 41% to 40%?
A) To reduce the fiscal deficit
B) To generate ₹350 billion for central government use
C) To promote financial independence of states
D) To compensate for low GST collections
E) To implement welfare schemes more effectively
Answer: B) To generate ₹350 billion for central government use
Explanation: The Union Government aims to reduce the tax revenue allocated to states, which could generate approximately ₹350 billion for central expenditure, though it may face political opposition.
3. What is the main concern of southern states regarding the upcoming delimitation process in India?
A) Reduction in Lok Sabha seats due to lower population growth
B) Unequal representation in the Rajya Sabha
C) Decreasing state revenues
D) Increased taxation on southern states
E) Reservation of seats for backward classes
Answer: A) Reduction in Lok Sabha seats due to lower population growth
Explanation: Southern states fear they will lose Lok Sabha seats in the 2026 delimitation as the process is based on population, which has grown at a slower rate in these states compared to the north.
4. Why does the IMF recommend India to bring down its fiscal deficit to 3% of GDP?
A) To encourage foreign investment
B) To align with global fiscal discipline standards
C) To ensure better financial stability and debt control
D) To reduce dependence on international loans
E) All of the above
Answer: E) All of the above
Explanation: The IMF believes a lower fiscal deficit will improve financial stability, attract investment, and align India with global fiscal discipline norms while reducing debt-related risks.
5. What is the goal of India’s debt strategy as per government policy?
A) To lower debt-to-GDP ratio to 50% by FY31
B) To increase tax rates to repay loans faster
C) To borrow more from foreign investors
D) To stop taking loans from international organizations
E) To privatize public sector banks
Answer: A) To lower debt-to-GDP ratio to 50% by FY31
Explanation: The government aims to reduce the debt-to-GDP ratio from 57.1% in FY25 to 50% by FY31 through stable, long-term domestic borrowing.
6. What is the key issue in India-EU relations?
A) EU’s trade deficit with India
B) Concerns over human rights and freedom of speech in India
C) India’s refusal to join EU-led military alliances
D) Visa restrictions on Indian students
E) Disputes over food export policies
Answer: B) Concerns over human rights and freedom of speech in India
Explanation: The EU acknowledges India as a strategic partner but has raised concerns over human rights, freedom of speech, and minority rights, leading to diplomatic challenges.
7. What is a major consequence of Trump’s proposed 25% tariff on EU imports?
A) The EU will offer tax exemptions to US companies
B) US exports will increase
C) The EU is likely to impose retaliatory tariffs
D) The US will sign a new trade deal with the EU
E) US consumers will benefit from lower prices
Answer: C) The EU is likely to impose retaliatory tariffs
Explanation: In response to Trump’s proposed tariffs on EU imports, the European Union has warned of retaliatory measures, potentially escalating trade tensions.
8. What is a key feature of Trump’s ‘Gold Card’ immigration plan?
A) Offers green card privileges for $5 million
B) Grants automatic U.S. citizenship
C) Eliminates the need for work visas
D) Focuses only on family-based immigration
E) Provides free education to immigrants
Answer: A) Offers green card privileges for $5 million
Explanation: Trump’s ‘Gold Card’ plan allows wealthy investors and elite graduates to gain green card benefits in exchange for a $5 million investment, replacing the EB-5 visa program.
9. Why are EPFO subscribers demanding a higher interest rate on their Provident Fund (PF) accounts?
A) Due to rising inflation affecting savings returns
B) Because the government is reducing corporate tax rates
C) As part of a new government scheme
D) To increase pension benefits for government employees
E) To match global pension fund returns
Answer: A) Due to rising inflation affecting savings returns
Explanation: Workers are demanding a higher interest rate on their PF accounts (currently 8.25%) as inflation erodes the real value of savings.
10. Why has Russia ruled out negotiations on annexed Ukrainian regions?
A) Russia considers them permanently part of its territory
B) Ukraine has agreed to Russia’s control over them
C) The UN has recognized Russia’s claim
D) NATO has withdrawn its support for Ukraine
E) Russia plans to return them in exchange for sanctions relief
Answer: A) Russia considers them permanently part of its territory
Explanation: Russia refuses to negotiate on Crimea (2014) and the regions annexed in 2022, declaring them an inseparable part of its territory, leading to continued tensions with Ukraine and the West.
