Indian Economy Quiz: IMF, World Bank and WTO

The correct answer is C, 1995. The World Trade Organization came into being on 1 January 1995 as the successor to the General Agreement on Tariffs and Trade, and India, which had been a party to GATT since 1948, became a member of the WTO on that very first day, which makes it a founding member. Option A is wrong because 2005 is remembered in trade history for the Hong Kong Ministerial Conference, not for India's membership. Option B is wrong because 2000 marks no change in India's membership, although the quantitative restrictions on imports were being removed around that time under WTO obligations. Option D is wrong because in 1990 the WTO did not exist; the Uruguay Round of negotiations that created it ran from 1986 to 1994 and ended with the Marrakesh Agreement. Remember the chain: GATT from 1948, WTO from 1 January 1995.

The correct answer is A, the Bretton Woods Conference of 1944. In July 1944 delegates of forty four allied nations, including India, met at Bretton Woods in New Hampshire in the United States and agreed to create the International Monetary Fund for monetary cooperation and the International Bank for Reconstruction and Development for reconstruction lending, which is why the two are called the Bretton Woods twins. Option B is wrong because the Yalta Conference of 1945 was a political meeting of the allied leaders about the post-war settlement of Europe, not about economic institutions. Option C is wrong because the Marrakesh Agreement of April 1994 closed the Uruguay Round and created the World Trade Organization, fifty years after Bretton Woods. Option D is wrong because the Doha Ministerial Conference of 2001 launched the Doha Development Agenda within the already existing WTO.

The correct answer is C, Washington DC. The IMF has its headquarters in Washington DC in the United States, and the World Bank Group stands across the street from it in the same city, which is why both are often described together as the Washington institutions. Option A is wrong because Geneva is the seat of the World Trade Organization, the International Labour Organisation and the World Health Organization, and it is the commonest distractor in this question. Option B is wrong because New York is the headquarters of the United Nations itself, together with UNICEF and UNDP, but not of the Fund. Option D is wrong because Basel in Switzerland is the seat of the Bank for International Settlements and of the Basel Committee on Banking Supervision, whose capital norms the banking examinations ask about separately. Learn the trio: IMF and World Bank in Washington DC, WTO in Geneva.

The correct answer is A, Geneva in Switzerland. The WTO works from Geneva, where the GATT secretariat had been housed before it, and its head carries the title Director-General. Option B is wrong because Paris is the headquarters of UNESCO and of the Organisation for Economic Cooperation and Development, as well as of the Financial Action Task Force. Option C is wrong because Vienna is the seat of the International Atomic Energy Agency, OPEC and UNIDO. Option D is wrong because Rome is the headquarters of the Food and Agriculture Organization, the World Food Programme and the International Fund for Agricultural Development. A useful way to hold these is by city: Geneva for trade, health and labour, Rome for food, Vienna for atomic energy and oil, Paris for education and economic cooperation, and Washington DC for the Fund and the Bank.

The correct answer is A, the General Agreement on Tariffs and Trade. GATT was signed in 1947 by twenty three countries, India among them, and came into force on 1 January 1948 as a treaty with a small secretariat rather than a full organisation. After eight rounds of negotiation, the last of them the Uruguay Round of 1986 to 1994, it was replaced by the WTO on 1 January 1995. Option B is wrong because UNCTAD, set up in 1964 with its seat at Geneva, continues to exist as a United Nations body for trade and development and was never replaced. Option C is wrong because the International Trade Centre is a joint agency of the WTO and the United Nations that helps small exporters and is not what the WTO replaced. Option D is wrong because the OECD is a separate grouping of mainly developed economies with its seat in Paris.

The correct answer is B, the International Monetary Fund. The World Economic Outlook is the IMF's survey of the world economy, carrying growth, inflation and current account projections for its member countries, and the Fund also publishes the Global Financial Stability Report and the Fiscal Monitor. Option A is wrong because the World Bank's flagship publication is the World Development Report, and it also brings out the Global Economic Prospects, which is the report most often confused with the World Economic Outlook. Option C is wrong because the WTO publishes the World Trade Report and its trade statistics, not a general economic outlook. Option D is wrong because the Asian Development Bank, with its headquarters at Manila, publishes the Asian Development Outlook. Learn the pairs: IMF with the World Economic Outlook, World Bank with the World Development Report, WTO with the World Trade Report.

The correct answer is C, the IDA, the International Development Association, founded in 1960 to lend to the poorest countries on concessional terms, that is interest free credits and grants with long repayment periods, which is why it is called the soft loan window of the World Bank. Option A is wrong because the IBRD, founded in 1944, lends to creditworthy middle income governments on market related terms and is the body usually meant when people say the World Bank. Option B is wrong because the IFC, founded in 1956, lends to and invests in private companies in developing countries without requiring a government guarantee. Option D is wrong because MIGA, founded in 1988, does not lend at all; it provides guarantees and political risk insurance to encourage foreign investment. The fifth arm, ICSID of 1966, settles investment disputes between investors and states.

The correct answer is D, the Indian rupee. The Special Drawing Right, created by the IMF in 1969 as a supplementary reserve asset, takes its value from a basket of five currencies only: the US dollar, the euro, the Chinese renminbi, the Japanese yen and the pound sterling. The Indian rupee is not one of them, although India holds an allocation of SDRs as part of its foreign exchange reserves. Option A is wrong because the Japanese yen has been in the basket from the earlier years of the five currency arrangement. Option B is wrong because the Chinese renminbi was added to the basket in 2016, becoming the fifth currency and the first from an emerging economy. Option C is wrong because the pound sterling has been in the basket throughout. Remember that an SDR is a reserve asset and a unit of account, not a currency that can be spent directly.

The correct answer is B, the Ministerial Conference. It is composed of the trade ministers of all member countries, meets at least once every two years and may take decisions on any matter covered by the WTO agreements; the first conference was held at Singapore in 1996 and the one at Doha in 2001 launched the Doha Development Agenda. Option A is wrong because the General Council, made up of ambassadors at Geneva, is the highest body between conferences and acts on their behalf, but it is not above them. Option C is wrong because the Dispute Settlement Body is the General Council sitting in another capacity to hear trade disputes, so it is part of that structure. Option D is wrong because the Secretariat and the Director-General serve the members and provide support; they take no decisions on trade rules, which in the WTO are agreed by consensus among members.

The correct answer is B, the World Trade Organization. TRIPS is one of the agreements that came out of the Uruguay Round and is administered by the WTO; it lays down minimum standards for patents, copyright, trademarks and geographical indications, and it is enforceable through the WTO dispute settlement system, which is what makes it different from earlier treaties. Option A is wrong, and is the natural trap, because the World Intellectual Property Organization in Geneva administers many intellectual property conventions and cooperates with the WTO, but TRIPS itself belongs to the WTO. Option C is wrong because UNIDO, with its seat at Vienna, works on industrial development and not on intellectual property rules. Option D is wrong because the IMF deals with monetary and balance of payments matters. The companion agreements are GATS for services and TRIMS for investment measures.

The correct answer is B, the World Bank. The World Development Report is the Bank's annual study, each edition devoted to one theme of development such as jobs, water, migration or the use of data, and the Bank also publishes the Global Economic Prospects. Option A is wrong because the IMF publishes the World Economic Outlook, the Global Financial Stability Report and the Fiscal Monitor. Option C is wrong because the United Nations Development Programme publishes the Human Development Report with the Human Development Index, which is the report most often confused with the World Bank's. Option D is wrong because the World Economic Forum, a private body based in Geneva that meets at Davos, publishes the Global Competitiveness Report and the Global Gender Gap Report. Reports and their publishers are a standing question type, so learn them as fixed pairs.