UPSC Prelims 2020— Question 86

This question tests trade-related investment measures. The key concept is: TRIMs disciplines investment measures that affect trade in goods and prohibits measures such as local-content or trade-balancing requirements that violate GATT principles. It does not apply to services in the broad sense stated, and it is specifically concerned with investment measures related to trade in goods. Thus statements 1 and 3 are correct. The verified answer for the uploaded Set-B paper is option C. Option A — 1 and 2 only: This is not the correct option. The option does not match the verified combination or conclusion. The decisive point is the distinction explained above: TRIMs disciplines investment measures that affect trade in goods and prohibits measures such as local-content or trade-balancing requirements that violate GATT principles. It does not apply to services in the broad sense stated, and it is specifically concerned with investment measures related to trade in goods. Thus statements 1 and 3 are correct. Therefore this alternative should be eliminated even if part of its wording appears plausible in isolation. Option B — 2 only: This is not the correct option. The option does not match the verified combination or conclusion. The decisive point is the distinction explained above: TRIMs disciplines investment measures that affect trade in goods and prohibits measures such as local-content or trade-balancing requirements that violate GATT principles. It does not apply to services in the broad sense stated, and it is specifically concerned with investment measures related to trade in goods. Thus statements 1 and 3 are correct. Therefore this alternative should be eliminated even if part of its wording appears plausible in isolation. Option C — 1 and 3 only: This is the correct option. It matches the verified conclusion because TRIMs disciplines investment measures that affect trade in goods and prohibits measures such as local-content or trade-balancing requirements that violate GATT principles. It does not apply to services in the broad sense stated, and it is specifically concerned with investment measures related to trade in goods. Thus statements 1 and 3 are correct. The wording of the option is consistent with the governing concept tested by the question. Option D — 1,2 and 3: This is not the correct option. The option does not match the verified combination or conclusion. The decisive point is the distinction explained above: TRIMs disciplines investment measures that affect trade in goods and prohibits measures such as local-content or trade-balancing requirements that violate GATT principles. It does not apply to services in the broad sense stated, and it is specifically concerned with investment measures related to trade in goods. Thus statements 1 and 3 are correct. Therefore this alternative should be eliminated even if part of its wording appears plausible in isolation. For UPSC-style elimination, first identify the exact proposition being tested, then evaluate each statement independently before comparing the answer codes. Avoid treating a broad or absolute statement as correct merely because its general theme is familiar. The precise qualifiers in the question—such as 'all', 'only', 'cannot', 'largest', 'always' or a specific institutional role—often determine the answer. On that basis, option C is the verified answer.