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4 questions

  • Economy & Banking16 May 2026

    Which of the following best explains how the BMI Pool reduces India's forex outflow?

    1. A.By retaining marine reinsurance premiums domestically that would otherwise flow to London and other foreign re/insurance markets
    2. B.By directly buying foreign currency from the RBI's reserves at concessional rates
    3. C.By imposing capital controls on Indian shipowners' foreign payments
    4. D.By replacing all FDI in India's shipping sector
    Show solution

    Answer: A. By retaining marine reinsurance premiums domestically that would otherwise flow to London and other foreign re/insurance markets

    The Pool **retains domestically** a larger share of marine reinsurance premiums and claims flows that would otherwise be ceded to **London and other foreign re/insurance hubs**, reducing **forex outflow**. The other options describe instruments — capital controls, RBI FX sales, FDI — that are not how a reinsurance pool functions.

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  • Economy & Banking16 May 2026

    The Bharat Maritime Insurance Pool (BMI Pool) is administered as Pool Administrator by which entity?

    1. A.General Insurance Corporation of India (GIC Re), the country's state-owned reinsurer
    2. B.Life Insurance Corporation of India (LIC), the largest Indian life-insurance company
    3. C.Reserve Bank of India (RBI), the central banking authority of the Government of India
    4. D.Shipping Corporation of India (SCI), a navratna shipping company under the central government
    Show solution

    Answer: A. General Insurance Corporation of India (GIC Re), the country's state-owned reinsurer

    The **Pool Administrator** of the BMI Pool is **GIC Re**, India's state-owned national reinsurer. **LIC** is a life insurer, **RBI** is the central bank, and **SCI** is a shipping operator — none of them administer the Pool.

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  • Economy & Banking25 Apr 2026

    After cancellation of a banking licence, RBI must approach which forum for winding-up proceedings?

    1. A.NCLT (National Company Law Tribunal)
    2. B.Supreme Court of India
    3. C.High Court (under BR Act Section 38)
    4. D.Insolvency and Bankruptcy Board of India
    Show solution

    Answer: C. High Court (under BR Act Section 38)

    Under Section 38 of the Banking Regulation Act, 1949, the RBI must approach the High Court (having jurisdiction over the bank's registered office) for winding-up proceedings of a banking company. While the Companies Act, 2013 generally vests winding-up jurisdiction with the NCLT, banking company winding-up has a specific BR Act framework that retains High Court jurisdiction.

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  • Economy & Banking25 Apr 2026

    RBI's power to cancel a banking licence is provided under which provision of the Banking Regulation Act, 1949?

    1. A.Section 22
    2. B.Section 35
    3. C.Section 36AB
    4. D.Section 38
    Show solution

    Answer: C. Section 36AB

    Section 36AB of the Banking Regulation Act, 1949 (added by amendment) explicitly empowers the RBI to cancel a banking licence where the operations of the bank are detrimental to depositor interests or public interest. Section 22 provides for INITIAL ISSUANCE of banking licences; Section 35 governs INSPECTIONS; Section 38 deals with WINDING-UP PROCEEDINGS in the High Court.

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