Under import substitution, India restricted imports through tariffs and quotas. Going by the NCERT Glossary, a quota is which kind of barrier to imports?
Answer & explanation
Correct answer: option 2
The correct answer is Option (2) → A non-tariff barrier, since it restricts the quantity of goods imported
A quota fixes the quantity of a good that can be imported. It is not a tax. Restrictions on imports in forms other than taxes are non-tariff barriers.
Option (1) A tariff barrier, since it is a restriction on imports in the form of a tax — Incorrect. Restrictions in the form of taxes are tariffs. A quota is not a tax.
Option (2) A non-tariff barrier, since it restricts the quantity of goods imported — Correct. A quota limits the quantity of imports, so it is a non-tariff barrier.
Option (3) A tariff barrier, since it makes imported goods more expensive — Incorrect. Making imports dearer is what a tariff does.
Option (4) A non-tariff barrier, since it is a tax levied on each tonne imported — Incorrect. A tax per tonne is a tariff. Non-tariff barriers are not taxes.
NCERT (2026-27): “2.5 Trade Policy: Import Substitution … In this policy the government protected the domestic industries from foreign competition. Protection from imports took two forms: tariffs and quotas. Tariffs are a tax on imported goods; they make imported goods more expensive and discourage their use. Quotas specify the quantity of goods which can be imported. …” Glossary: “Non-tariff Barriers – All the restrictions on imports by a government in the form other than taxes. They mainly include restrictions on quantity and quality of goods imported.” Glossary: “Tariff Barriers – All the restrictions on imports by a government in the form of taxes.” |