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NEXUS / 2024 / GS1
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UPSC 2024: Nexus 51—60

Sovereign Debt, Digital Rupees, Epigraphy & Intangible Heritage. [Set A]

Question 51

Global Sovereign Debt

Consider the following statements:

Statement-I:

If the United States of America (USA) were to default on its debt, holders of US Treasury Bonds will not be able to exercise their claims to receive payment.

Statement-II:

The USA Government debt is not backed by any hard assets, but only by the faith of the Government.

Which one of the following is correct in respect of the above statements?

Official Verdict: (a) Both Statement-I and Statement-II are correct and Statement-II explains Statement-I

The Core Concept: Unlike a corporation whose bonds are secured by physical collateral (factories, land) that creditors can seize and liquidate in bankruptcy, US Treasury Bonds are fiat sovereign debt. They are backed exclusively by the "full faith and credit" of the US Government (Statement-II is true). Because there are no underlying "hard assets" legally pledged to the bondholders, if the USA were to genuinely default, creditors would have no physical assets to exercise claims against or seize to recover their payments (Statement-I is true, and II explains I).

Tethered to: REALM 164: Sovereign Debt & Financial Stability

"Full Faith & Credit" No Hard Assets (St II) T-Bond No claims to seize (St I)
BORROWER Bank A Bank B Bank C DROPPED QUESTION (X)

Question 52

Corporate Finance

Consider the following statements:

Statement-I:

Syndicated lending spreads the risk of borrower default across multiple lenders.

Statement-II:

The syndicated loan can be a fixed amount/lump sum of funds, but cannot be a credit line.

Which one of the following is correct in respect of the above statements?

Official Verdict: (X) Dropped Question

The Core Concept: A syndicated loan is one where a group of lenders (a syndicate) works together to provide funds for a single borrower, massively reducing the individual risk of default for any single bank (Statement-I is true). However, Statement-II is definitively false in financial practice: syndicated loans can absolutely be structured as revolving credit lines (revolvers), allowing the borrower to draw down, repay, and redraw funds as needed. Due to potential framing ambiguity, UPSC dropped this question from scoring.

Tethered to: REALM 126: Banking: Meaning & Functions

Question 53

Digital Currency (CBDC)

Consider the following statements in respect of the digital rupee:

  1. It is a sovereign currency issued by the Reserve Bank of India (RBI) in alignment with its monetary policy.
  2. It appears as a liability on the RBI's balance sheet.
  3. It is insured against inflation by its very design.
  4. It is freely convertible against commercial bank money and cash.

Which of the statements given above are correct?

Official Verdict: (d) 1, 2 and 4

The Core Concept: India's CBDC (e₹) is legal tender and a direct sovereign liability of the RBI, exactly like physical cash (statements 1 and 2 are true). It is designed to be exchanged 1:1 with physical cash or commercial bank money (Statement 4 is true). However, because it is merely a digital twin of fiat currency, it holds no inherent protection against inflation—if the purchasing power of the physical Rupee drops, the purchasing power of the e-Rupee drops identically (Statement 3 is false).

Tethered to: REALM 62: Central Bank Digital Currency (CBDC)

e₹ Fiat (Liability) Not Insured vs Inflation ❌ Digital Equivalent of Physical Cash
2. Shakyamuni ✅ "Sage of the Shakyas" 3. Tathagata ✅ "One who has thus gone" 1. Nayaputta ❌ (Mahavira)

Question 54

Buddhist History

With reference to ancient India, Gautama Buddha was generally known by which of the following epithets?

  1. Nayaputta
  2. Shakyamuni
  3. Tathagata

Select the correct answer using the code given below:

Official Verdict: (b) 2 and 3 only

The Core Concept: Gautama Buddha is historically revered under several epithets. Shakyamuni refers to his birth in the Shakya clan ("Sage of the Shakyas"). Tathagata (translated roughly as "one who has thus gone" or "one who has thus arrived") is the title the Buddha used most often to refer to himself in the Pali Canon. However, Nigantha Nataputta (often shortened to Nayaputta in Prakrit texts) was the name by which Buddhist texts referred to his contemporary, Vardhamana Mahavira (the 24th Tirthankara of Jainism).

Tethered to: REALM 69: Buddhism

Question 55

Ancient Indian Sites

Consider the following information:

  • 1. Chandraketugarh: Odisha | Trading Port town
  • 2. Inamgaon: Maharashtra | Chalcolithic site
  • 3. Mangadu: Kerala | Megalithic site
  • 4. Salihundam: Andhra Pradesh | Rock-cut cave shrines

In which of the above rows is the given information correctly matched?

Official Verdict: (b) Only two

The Core Concept: Row 1 is false: Chandraketugarh was indeed a vital ancient port city, but it is located in West Bengal (North 24 Parganas), not Odisha. Row 2 is true: Inamgaon (on the Ghod river in Maharashtra) is a premier, heavily excavated Chalcolithic farming settlement. Row 3 is true: Mangadu in Kollam, Kerala is a renowned Megalithic site featuring ancient urn burials. Row 4 is false: Salihundam (Srikakulam, AP) is a prominent ancient Buddhist hilltop structural stupa complex, not a rock-cut cave shrine. Thus, exactly two rows are correct.

Tethered to: REALM 05: Chalcolithic Cultures

SITE VERIFICATION 1. Chandraketugarh Odisha ❌ (Bengal) 2. Inamgaon Chalcolithic Maha ✅ 3. Mangadu Megalithic Kerala ✅ 4. Salihundam Rock Caves ❌ (Stupa)
Krishnadevaraya Afonso de Albuquerque Bhatkal 1510 CE Coastal Diplomacy

Question 56

Colonial Advent

Who of the following rulers of medieval India gave permission to the Portuguese to build a fort at Bhatkal?

  • (a) Krishnadevaraya
  • (b) Narasimha Saluva
  • (c) Muhammad Shah III
  • (d) Yusuf Adil Shah

Official Verdict: (a) Krishnadevaraya

The Core Concept: In 1510, the brilliant Portuguese Governor Afonso de Albuquerque dispatched an embassy (led by Friar Luiz) to the newly crowned emperor of Vijayanagara, Krishnadevaraya. Seeking to secure a monopoly over the lucrative Arabian horse trade essential for his cavalry, Krishnadevaraya granted the Portuguese permission to erect a fort at Bhatkal (a strategic port on the Kanara coast) on the strict condition that all imported horses be sold exclusively to Vijayanagara, denying them to his enemy, the Adil Shahi sultanate of Bijapur.

Tethered to: REALM 04: Advent of Europeans

Question 57

Colonial Revenue Systems

With reference to revenue collection by Cornwallis, consider the following statements:

  1. Under the Ryotwari Settlement of revenue collection, the peasants were exempted from revenue payment in case of bad harvests or natural calamities.
  2. Under the Permanent Settlement in Bengal, if the Zamindar failed to pay his revenues to the state, on or before the fixed date, he would be removed from his Zamindari.

Which of the statements given above is/are correct?

Official Verdict: (X) Dropped Question

The Core Concept: This question was officially dropped, likely due to severe historical conflation in the prompt. Lord Cornwallis introduced the Permanent Settlement in Bengal (1793), but he had absolutely nothing to do with the Ryotwari Settlement (which was introduced decades later by Thomas Munro and Alexander Read in Madras). Furthermore, Statement 1 is historically false: under Ryotwari, revenue demands were notoriously rigid, and peasants were rarely exempted during bad harvests, leading to massive distress. Statement 2 describes the infamous "Sunset Clause" of the Permanent Settlement, where defaulting Zamindars had their estates seized and auctioned off.

Tethered to: REALM 12: Land Revenue Systems

Question Flaw: Cornwallis did NOT create Ryotwari Sunset Clause DROPPED QUESTION (X)
Upanishads c. 800 - 500 BCE Puranas c. 300 CE onwards "No Parables" is False (St 1) ❌ (e.g. Nachiketa, Satyakama) Vedic vs Gupta Chronology

Question 58

Ancient Literature & Philosophy

Consider the following statements:

  1. There are no parables in Upanishads.
  2. Upanishads were composed earlier than the Puranas.

Which of the statements given above is/are correct?

Official Verdict: (b) 2 only

The Core Concept: Statement 1 is entirely false: the Upanishads are highly pedagogical texts that rely extensively on profound parables and dialogues (such as the story of young Nachiketa conversing with Yama in the Katha Upanishad, or Satyakama Jabala in the Chandogya Upanishad) to convey complex metaphysical concepts. Statement 2 is chronologically true: The principal Upanishads form the concluding part of the Vedas (Vedanta) and were composed roughly between 800 and 500 BCE. The major Puranas, in their written, codified forms, were compiled much later during the Gupta and post-Gupta eras (3rd to 10th century CE).

Tethered to: REALM 32: Philosophy & Religion

Question 59

Global Agricultural Governance

Consider the following statements:

  1. India is a member of the International Grains Council.
  2. A country needs to be a member of the International Grains Council for exporting or importing rice and wheat.

Which of the statements given above is/are correct?

Official Verdict: (a) 1 only

The Core Concept: The International Grains Council (IGC) is an intergovernmental organization based in London that oversees the Grains Trade Convention to foster international cooperation and market transparency. India is indeed a participating member (Statement 1 is true). However, global commodity trading is governed by bilateral agreements and WTO frameworks, not the IGC. Membership in the IGC is entirely voluntary and is absolutely not a legal prerequisite for a nation to import or export rice, wheat, or any other grain on the global market (Statement 2 is false).

Tethered to: REALM 226: India & International Organisations

India = Member Global Grain Trade No Membership Gate (2) ❌
UNESCO 2023 GARBA OF GUJARAT

Question 60

Cultural Heritage

Which one of the following was the latest inclusion in the Intangible Cultural Heritage List of UNESCO?

  • (a) Chhau dance
  • (b) Durga puja
  • (c) Garba dance
  • (d) Kumbh mela

Official Verdict: (c) Garba dance

The Core Concept: This is a pure current affairs question mapping to India's cultural diplomacy. In December 2023, during the 18th session of the Intergovernmental Committee in Botswana, the traditional 'Garba of Gujarat' was officially inscribed on the Representative List of the Intangible Cultural Heritage of Humanity, making it India's 15th (and the latest prior to the 2024 Prelims) cultural element to be listed. Durga Puja in Kolkata was previously inscribed in 2021, Kumbh Mela in 2017, and Chhau dance in 2010.

Tethered to: REALM 109: Intangible Heritage