Logical (Critical) Reasoning Questions for CLAT | QB Set 80

India has surpassed Japan to become the world’s fourth-largest economy with a size of USD 4.18 trillion, and is poised to overtake Germany to become the third-largest by 2030, the government has said.

With continuing good growth numbers, India is also the world’s fastest-growing major economy.  India’s real GDP grew 8.2 per cent in the second quarter of 2025-26, up from 7.8 per cent in the first quarter and 7.4 per cent in the fourth quarter of the last fiscal.

“With GDP valued at USD 4.18 trillion, India has surpassed Japan to become the world’s fourth-largest economy, and is poised to displace Germany from the third rank in the next 2.5 to 3 years with a projected GDP of USD 7.3 trillion by 2030,” according to a government release providing a snapshot of reforms in 2025.

The US is the world’s largest economy, and China occupies the second spot. The growth momentum further surprised on the upside, with GDP expanding to a six-quarter high in Q2 of 2025-26, reflecting India’s resilience amid persistent global trade uncertainties, it said.

Domestic drivers, led by robust private consumption, played a central role in supporting this expansion. The release further said international agencies have echoed this optimism and cited projections made by various entities.

The World Bank has projected a 6.5 per cent growth in 2026; Moody’s expects India to remain the fastest-growing G20 economy with a growth of 6.4 per cent in 2026 and 6.5 per cent in 2027. The IMF has raised its projections to 6.6 per cent for 2025 and 6.2 per cent for 2026; the OECD forecasts 6.7 per cent growth in 2025 and 6.2 per cent in 2026.

Also, S&P anticipates a growth of 6.5 per cent in the current fiscal and 6.7 per cent in the next; the Asian Development Bank has lifted its 2025 forecast to 7.2 per cent; and Fitch has raised its FY26 projection to 7.4 per cent on stronger consumer demand.

“India is among the world’s fastest-growing major economies and is well-positioned to sustain this momentum. With the ambition of attaining high middle-income status by 2047- the centenary year of its independence, the country is building on strong foundations of economic growth, structural reforms, and social progress,” the government said.

The release also highlighted that inflation remains below the lower tolerance threshold, unemployment is on a declining trajectory, and export performance continues to improve.

Furthermore, financial conditions have stayed benign, with strong credit flows to the commercial sector, while demand conditions remain firm, supported by a further strengthening of urban consumption.

(Source: NDTV)

Question 1

Which of the following can be most reasonably inferred from the passage?

A. India’s economic growth is being driven more by internal consumption than by external trade.

B. India’s growth rate is entirely insulated from global economic uncertainties.

C. India’s GDP growth has been consistently above 9 per cent across recent quarters.

D. International agencies have unanimously predicted identical growth figures for India.

Correct Answer: A

Question 2

The passage implicitly assumes which of the following?

A. Sustained domestic demand can help offset adverse global economic conditions.

B. India’s economy will overtake the US economy before 2030.

C. Inflation control alone guarantees long-term economic stability.

D. Growth projections by international agencies are legally binding on governments.

Correct Answer: A

Question 3

Which of the following, if true, would most strengthen the government’s claim that India is well-positioned to sustain its growth momentum?

A. Global trade tensions have completely disappeared in recent years.

B. India has stopped relying on foreign investment for economic growth.

C. Structural reforms have led to consistent increases in productivity and employment.

D. Other major economies are expected to experience economic contraction by 2030.

Correct Answer: C

Question 4

Which of the following statements would most weaken the optimism expressed in the passage?

A. International agencies frequently revise their growth forecasts.

B. India’s GDP growth varies across different quarters.

C. Germany’s economy is expected to grow at a slower pace than India’s.

D. A sharp decline in private consumption reduces domestic demand significantly.

Correct Answer: D

Question 5

Which of the following is the most appropriate conclusion that can be drawn from the passage?

A. India’s economic growth depends solely on international approval and projections.

B. Rapid GDP growth automatically ensures equitable social development.

C. Becoming the third-largest economy will eliminate unemployment in India.

D. Strong domestic fundamentals have played a key role in India’s recent economic performance.

Correct Answer: D