India & US Push for a Mutually Beneficial Trade Deal
India and the United States have agreed to intensify efforts toward finalizing a mutually beneficial trade agreement, according to the MEA on 19 September 2025. The aim is to address ongoing trade disputes (including recent U.S. tariffs on Indian goods) and enhance economic cooperation. This renewed engagement is expected to boost bilateral trade and investment, reduce trade friction, and also deepen strategic ties between the two democracies.
MCQs:
1. What is one of the reasons India and the U.S. are pushing for a trade deal now?
A) To negotiate defence cooperation only
B) To resolve existing tariff issues and boost investment
C) To form a mutual currency agreement
D) To merge their trade blocs
Answer: B
2. According to reports, what action by the U.S. has strained the trade relations with India?
A) Imposition of 50% tariffs on certain Indian goods
B) Banning all Indian exports
C) Suspending diplomatic relations
D) Imposing sanctions on Indian banks
Answer: A
3. The renewed trade discussions between India & U.S. are expected to primarily benefit which of the following?
A) Only India’s agricultural sector
B) Both trade & investment flows, plus strategic cooperation
C) Only the U.S. technology sector
D) Only defence industry cooperation
Answer: B
UK’s Rising Borrowing, Currency Slide & Fiscal Stress
In August 2025, the UK government borrowing surged to £18 billion, about £5.5 billion more than forecast, making it the highest borrowing for an August month in five years. This elevated borrowing, along with inflation‐linked interest payments, boosted the total borrowing for the financial year to ~£83.8 billion, overshooting projections. Markets reacted by pushing sterling downward. There are now expectations of tax hikes in the Autumn Budget to close a budget deficit estimated at around £22 billion. At the same time, insolvencies have risen substantially, signalling rising financial stress among businesses and households.
MCQs:
1. The UK government borrowing in August 2025 was about how much over forecasts?
A) £1 billion
B) £2.5 billion
C) £5.5 billion
D) £10 billion
Answer: C
2. One consequence mentioned in connection with rising government borrowing is:
A) Strengthening of sterling
B) Decline in insolvencies
C) Expectation of tax increases in the Autumn Budget
D) Immediate interest rate cuts by the Bank of England
Answer: C
3. The total borrowing for the UK in the current financial year (as of August 2025) is around:
A) £50 billion
B) £60 billion
C) £70 billion
D) £83.8 billion
Answer: D
ESIC Launches One-Time Dispute Resolution Scheme (Amnesty Scheme-2025)
India’s Employees State Insurance Corporation (ESIC) has introduced a one-time dispute resolution or “Amnesty Scheme-2025,” running from 1 October 2025 to 30 September 2026. The goal is to reduce the backlog of industrial litigation, especially around damages, interest, and coverage issues under the ESI Act. Alongside this, the SPREE Scheme is ongoing until end-December 2025, allowing industries/employees who were unregistered to enroll without liability for past dues. This is intended to increase compliance, reduce disputes, and expand social security coverage.
MCQs:
1. What is the duration of the Amnesty Scheme-2025 launched by ESIC?
A) 1 January 2025 – 31 December 2025
B) 1 October 2025 – 30 September 2026
C) 1 April 2025 – 31 March 2026
D) 1 December 2025 – 30 November 2026
Answer: B
2. Under the SPREE Scheme, unregistered industries/employees are allowed to enrol without liability for:
A) Future dues only
B) Past dues only
C) Both past and future dues
D) Neither past nor future dues
Answer: B
3. What kinds of disputes does the Amnesty Scheme aim to resolve?
A) Criminal cases against industrialists
B) Disputes related to damages, interest, and coverage under ESI Act
C) Foreign trade disputes
D) Contractual disputes unrelated to ESI
Answer: B
Global Markets & Key Central Bank Moves Amid U.S. Fed Rate Cut
The U.S. Federal Reserve made its first rate cut since December (year not specified), which has triggered global scrutiny of economic indicators, especially on inflation, housing, and consumer sentiment. The dollar has weakened to its lowest level since 2022. Other central banks (e.g. in Switzerland and Australia) and economic regions are adjusting their monetary policy stances based on upcoming inflation data and domestic pressures. Additionally, the UN General Assembly is approaching, where major geopolitical issues (Ukraine, Gaza, Iran, Palestine) are expected to be discussed, affecting investor sentiment globally.
MCQs:
1. What recent move by the U.S. Federal Reserve influenced global markets?
A) Rate hike
B) Rate cut
C) Maintaining same rate
D) Announcing quantitative easing
Answer: B
2. The U.S. dollar has reached its lowest level since which year?
A) 2024
B) 2023
C) 2022
D) 2021
Answer: C
3. Among the issues expected to be discussed at the upcoming UN General Assembly are:
A) Economic integration of Southeast Asia only
B) Conflicts in Gaza and Ukraine, recognition of a Palestinian state, Iran’s nuclear programme
C) Space exploration treaties exclusively
D) Global ban on cryptocurrencies
Answer: B
India’s Economic Growth Could Be Threatened by U.S. Trade Policies under Trump
An article warns that India’s current economic “virtuous cycle” may be jeopardized by aggressive U.S. trade policy under Donald Trump. Key concerns include a 50% tariff on Indian goods, and the proposed “Hire Act,” which could impose a 25% tax on outsourcing payments. Since India’s services exports to the U.S. (especially IT & software) are large (over US$100 billion), these policies could have adverse effects on its current account, fiscal health, inflation, rupee value, and foreign investment. The article suggests that although India is pursuing free trade deals and reforms, they might be insufficient to fully counterbalance potential losses from worsening trade relations.
MCQs:
1. What is the proposed U.S. tariff rate on Indian goods mentioned in the article?
A) 25%
B) 50%
C) 75%
D) 10%
Answer: B
2. The “Hire Act” proposed in the U.S. would:
A) Subsidise outsourcing to India
B) Tax outsourcing payments at 25%
C) Ban outsourcing entirely
D) Provide tax credits to outsourcing firms
Answer: B
3. Which sectors are especially at risk in India due to these U.S. trade policies?
A) Agriculture and mining
B) Heavy manufacturing only
C) IT / services exports and sectors tied to exports to the U.S.
D) Domestic retail only
Answer: C
