UPSC Prelims 2001·GS1·economy·economic sectors and development

Assertion (A): There was an increase in industrial production during 1999-2000. Reason (R): The period witnessed a stable exchange rate and improved business sentiments.

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  1. ABoth A and R are individually true, and R is the correct explanation of ACorrect
  2. BBoth A and R are individually true, but R is NOT a correct explanation of A
  3. CA is true, but R is false
  4. DA is false, but R is true

Explanation

The correct answer is A because both statements are historically accurate and linked by cause and effect. During the fiscal year 1999-2000, India experienced a significant recovery in industrial growth, with the Index of Industrial Production showing a growth rate of around 6.7 percent compared to the previous year. This growth was driven by several favorable macroeconomic factors. A stable exchange rate reduced uncertainty for importers and exporters, while improved business sentiments encouraged private investment and consumer demand. Since these factors directly contributed to the rise in manufacturing and output, the reason provided explains why the assertion occurred. Therefore, both statements are true and the reason is the correct explanation of the assertion.
economy: Assertion (A): There was an increase in industrial production during 1999-2000. Reason (R): The period witnessed a stabl
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