UPSC Prelims 2020 Question:

Consider the following statements

1. The value of Indo-Sri Lanka trade has consistently increased in the last decade.
2. "Textile and textile articles" constitute an important item of trade between India and Bangladesh.
3. In the last five years, Nepal has been the largest trading partner of India in South Asia.
   
   

Which of the statements given above is/are correct?

Explanation:

• The trade between India and Sri Lanka was valued at USD 4.5 billion during 2016-17 as compared to USD 6.05 billion during 2015-16, registering a sharp decline of 25.25%. The exports decreased by 26.14 % to USD 3.9 billion in 2016-17 from USD 5.31 billion in the previous year. The export value in 2016-17 is the lowest in last 5 years. The decline is entirely contributed by reduction in export of aircraft by USD 1.22 billion. So, statement 1 is not correct.
  
  
• Textiles contributed 31.3% of Indian exports to Bangladesh in 2016-17. The other prominent products of export were engineering products (around 25% of exports), Chemical products (9% of exports) and vegetable products such as. So, statement 2 is correct.
  
  
• As per 2016-17 data, Bangladesh is the largest trading partner in South Asia, followed by Nepal, Sri Lanka, Pakistan, Bhutan, Afghanistan and Maldives. The level of Indian exports also follows the same order. So, statement 3 is not correct.
  
  

Therefore, option (2) is the correct answer.

Subject: Economics | Foreign Trade and Investment