External sector and international economic institutions: previous-year questions
62 real UPSC Prelims questions (2011–2026) with the official answer and a clear explanation. 20 of them came in the last five papers.
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Questions per year, counted from the official papers.
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In the context of global oil prices, “Brent crude oil” is frequently referred to in the news. What does this term imply ?
- 1. It is a major classification of crude oil.
- 2. It is sourced from North Sea.
- 3. It does not contain sulphur.
Which of the statements given above is/are correct ?
Answer (b) & explanation
Statements 1 and 2 are correct (b). Brent is a major classification and benchmark grade of crude oil (1), drawn from oilfields in the North Sea between Britain and Norway (2). About two-thirds of world crude is priced against it. Statement 3 is wrong: Brent is 'sweet', meaning low in sulphur (about 0.4%), not sulphur-free; no natural crude is entirely free of sulphur. So (a), (c) and (d) fail.
Notice the other benchmarks: WTI (West Texas Intermediate, US) is lighter and sweeter than Brent, Dubai/Oman is a medium sour benchmark for Asian buyers, and India tracks the Indian Basket (mostly sour Gulf crude). Trap: 'low sulphur' is quietly turned into 'no sulphur'.
Answer as per the official UPSC answer key.
Regarding the International Monetary Fund, which one of the following statements is correct ?
Answer (c) & explanation
It grants loans to only member countries is correct (c). The IMF (1944, Bretton Woods) lends only to its 190 member countries, mainly to fix balance-of-payments problems, often with conditions. Each member pays a quota that sets its voting power and how much it can borrow. (a) is wrong: non-members cannot borrow. (b) is wrong: most IMF loans now go to developing and emerging economies. (d) is wrong: loans go to member governments, usually routed through their central banks or treasuries, not to any central bank on its own.
Notice the wider frame: the IMF's reserve asset is the SDR, valued against five currencies, including the yuan since 2016. Kristalina Georgieva began her second term as Managing Director in October 2024. India borrowed from the IMF in 1991.
Answer as per the official UPSC answer key.