JKPSC Prelims 2023
General Studies (Paper 1)
Consider the following statements regarding the Inverted duty structure:
Answer & Explanation
Click "Check Answer" to reveal
Correct Answer:
Option A —
1 only
Analysis of the Statements1. Definition of Inverted Duty Structure (Correct)
An Inverted Duty Structure (IDS) occurs when the customs duty (import tax) on raw materials or intermediate components is higher than the duty on the finished product.
Example: If importing plastic granules (raw material) costs 10% duty, but importing a finished plastic chair costs only 5% duty, the structure is "inverted."
2. Impact on Domestic Manufacturing (Incorrect)
An inverted duty structure actually discourages domestic manufacturing.
It makes local production more expensive because manufacturers have to pay a high price for inputs.
Meanwhile, finished goods from abroad enter the market cheaply.
This places domestic industries at a disadvantage, leading to "de-industrialization" or a preference for trading over manufacturing.
Answer verified by Quintessence Classes faculty — Karan Nagar, Srinagar.
Try another question from JKPSC JKAS 2023 Prelims
Try another question from General Studies (Paper 1)
More General Studies (Paper 1) questions
From across UPSC, JKPSC, and JKSSB papers — same subject, different years.
Consider the following statements:Assertion (A): Atharva Veda, Mahabharata, Ramayana and Gita were translated into Persian during Akbar’s...
Consider the following statement with regard to SemiCon India 2022 conference:1. The theme of the Semicon India conference is 'Catalyzing...
Consider the following statements:Assertion (A): The Jammu & Kashmir Assembly Elections 2024 were the third such elections in the last de...
Which of the following is not a step under Atma Nirbhar Bharat?
Assertion (A): In Ashoka's time, Bherighosa was replaced with Dhammaghosha.
Reason (R): After Ashoka acceded to the throne, Ashoka fought...