Government Policies & Schemes for Enterprise Development MCQs With Answer

Introduction: Government Policies & Schemes for Enterprise Development MCQs With Answer helps M.Pharm students understand the regulatory and incentive landscape that supports starting and scaling pharmaceutical enterprises in India. This collection of targeted multiple-choice questions covers key schemes—MSME/UDYAM registration, Startup India, MUDRA, CGTMSE, PLI for pharmaceuticals, Bulk Drug Parks, and institutional roles like SIDBI and NSIC. Emphasis is placed on eligibility, objectives, benefits, and practical implications for pharma entrepreneurs, including access to finance, technology upgradation, incubation and market support. These MCQs are designed to build conceptual clarity and exam readiness for MIP 204T – Entrepreneurship Management while linking policy mechanisms to real-world pharmaceutical enterprise development.

Q1. Which of the following correctly defines the current MSME classification criteria in India?

• Micro: Investment <= 1 crore and Turnover <= 5 crore; Small: Investment <= 10 crore and Turnover <= 50 crore; Medium: Investment <= 50 crore and Turnover <= 250 crore
• Micro: Investment <= 25 lakh and Turnover <= 1 crore; Small: Investment <= 5 crore and Turnover <= 25 crore; Medium: Investment <= 10 crore and Turnover <= 50 crore
• Micro: Investment <= 50 lakh and Turnover <= 2 crore; Small: Investment <= 5 crore and Turnover <= 20 crore; Medium: Investment <= 25 crore and Turnover <= 100 crore
• Micro: Investment <= 10 lakh and Turnover <= 50 lakh; Small: Investment <= 50 lakh and Turnover <= 5 crore; Medium: Investment <= 5 crore and Turnover <= 25 crore

Correct Answer: Micro: Investment <= 1 crore and Turnover <= 5 crore; Small: Investment <= 10 crore and Turnover <= 50 crore; Medium: Investment <= 50 crore and Turnover <= 250 crore

Q2. What is the primary purpose of Udyam Registration for enterprises?

• To register businesses for income tax returns
• To provide a unique identity and access to MSME benefits and schemes
• To obtain a manufacturing license for pharmaceutical drugs
• To serve as a substitute for company incorporation documents

Correct Answer: To provide a unique identity and access to MSME benefits and schemes

Q3. The MUDRA scheme classifies loans into which three categories based on loan size?

• Shishu (up to 50,000), Kishor (50,001–5,00,000), Tarun (5,00,001–10,00,000)
• Seed (up to 25,000), Growth (25,001–2,00,000), Scale (2,00,001–5,00,000)
• Micro (up to 1,00,000), Small (1,00,001–5,00,000), Medium (5,00,001–10,00,000)
• Start (up to 75,000), Develop (75,001–3,00,000), Expand (3,00,001–10,00,000)

Correct Answer: Shishu (up to 50,000), Kishor (50,001–5,00,000), Tarun (5,00,001–10,00,000)

Q4. What is the key objective of the Credit Guarantee Fund Trust for Micro and Small Enterprises (CGTMSE)?

• To provide equity capital to startups in biotechnology
• To offer collateral-free credit guarantees to lenders for loans to MSEs
• To insure exporters against foreign exchange risks
• To directly lend working capital to pharmaceutical companies

Correct Answer: To offer collateral-free credit guarantees to lenders for loans to MSEs

Q5. Which institution is primarily tasked with promoting and financing micro, small and medium enterprises (MSMEs) in India?

• National Pharmaceutical Pricing Authority (NPPA)
• Small Industries Development Bank of India (SIDBI)
• Food Safety and Standards Authority of India (FSSAI)
• Central Drugs Standard Control Organization (CDSCO)

Correct Answer: Small Industries Development Bank of India (SIDBI)

Q6. One of the major aims of the Production Linked Incentive (PLI) scheme for pharmaceuticals is to:

• Provide free raw materials to all drug manufacturers
• Encourage domestic manufacturing by offering incentives on incremental sales of eligible products
• Replace all existing quality standards with a single code
• Ensure price control of all formulations by the government

Correct Answer: Encourage domestic manufacturing by offering incentives on incremental sales of eligible products

Q7. The Bulk Drug Parks scheme primarily aims to:

• Establish export-only hubs for finished pharmaceuticals
• Create world-class common infrastructure for API and bulk drug manufacturing to reduce dependence on imports
• Provide subsidies for retail pharmacies
• Fund clinical trials for new drug candidates

Correct Answer: Create world-class common infrastructure for API and bulk drug manufacturing to reduce dependence on imports

Q8. Which scheme specifically targets facilitating bank loans between INR 10 lakh and INR 1 crore to SC/ST entrepreneurs and women?

• Startup India
• Stand-Up India
• MUDRA
• Atmanirbhar Bharat

Correct Answer: Stand-Up India

Q9. Which government initiative focuses on creating a supportive ecosystem for technology startups through tax benefits, easier compliance, and incubation support?

• Make in India
• Startup India
• Skill India
• National Health Mission

Correct Answer: Startup India

Q10. National Small Industries Corporation (NSIC) helps MSMEs by providing which of the following services?

• Import licensing for bulk APIs without restrictions
• Marketing support, raw material procurement assistance and technology support
• Direct tax exemptions for 20 years
• Issuing manufacturing licenses for scheduled drugs

Correct Answer: Marketing support, raw material procurement assistance and technology support

Q11. The Credit Linked Capital Subsidy Scheme (CLCSS) for technology upgradation provides:

• Interest-free loans for export orders
• A capital subsidy for MSMEs to adopt approved technologies by reducing the cost of institutional finance
• Free equipment without any matching contribution
• Grants for marketing only

Correct Answer: A capital subsidy for MSMEs to adopt approved technologies by reducing the cost of institutional finance

Q12. Which ministry in India is primarily responsible for framing policies specific to the pharmaceutical sector and promoting domestic drug manufacturing?

• Ministry of Health and Family Welfare
• Department of Pharmaceuticals (Ministry of Chemicals and Fertilisers)
• Ministry of Commerce and Industry
• Ministry of Agriculture

Correct Answer: Department of Pharmaceuticals (Ministry of Chemicals and Fertilisers)

Q13. Atal Innovation Mission (AIM) supports entrepreneurship by:

• Providing direct export subsidies to established firms
• Establishing innovation and incubation centers and supporting startups and technology commercialization
• Offering guaranteed government contracts for all incubated startups
• Replacing private incubators with government-run facilities only

Correct Answer: Establishing innovation and incubation centers and supporting startups and technology commercialization

Q14. Which of the following is a key benefit available to DPIIT-recognized startups under Startup India?

• Automatic exemption from all labour laws
• Tax holiday benefits subject to conditions and faster patent processing along with self-certification
• Free international marketing for five years
• Guaranteed loan approvals from public sector banks

Correct Answer: Tax holiday benefits subject to conditions and faster patent processing along with self-certification

Q15. The National Manufacturing Competitiveness Programme (NMCP) aims to:

• Phase out small manufacturers in favor of large-scale units
• Enhance competitiveness of micro and small enterprises through quality improvement, testing and R&D support
• Provide free land for new factories
• Regulate drug prices centrally for all medicines

Correct Answer: Enhance competitiveness of micro and small enterprises through quality improvement, testing and R&D support

Q16. Which policy reform aimed at simplifying compliance for businesses includes measures such as self-certification and single-window clearances?

• Goods and Services Tax (GST)
• Ease of Doing Business reforms
• National Health Policy
• Essential Commodities Act

Correct Answer: Ease of Doing Business reforms

Q17. For a pharmaceutical entrepreneur seeking working capital without collateral, which scheme or instrument is most directly relevant?

• CGTMSE (Credit Guarantee Fund Trust for Micro and Small Enterprises)
• Patent Cooperation Treaty
• Foreign Direct Investment automatic route
• Export Promotion Capital Goods (EPCG) scheme

Correct Answer: CGTMSE (Credit Guarantee Fund Trust for Micro and Small Enterprises)

Q18. Which institution often provides refinance and promotional support for MSME lending and is a nodal agency for many MSME schemes?

• Reserve Bank of India (RBI)
• Small Industries Development Bank of India (SIDBI)
• Election Commission of India
• Central Pollution Control Board (CPCB)

Correct Answer: Small Industries Development Bank of India (SIDBI)

Q19. The objective of Atmanirbhar Bharat packages with respect to pharmaceutical enterprises primarily included:

• Only tariff increases on imported medicines
• Measures to boost domestic manufacturing capacity, support supply chains, and provide fiscal and policy incentives
• Complete nationalization of drug manufacturing
• Eliminating all regulatory checks to speed production

Correct Answer: Measures to boost domestic manufacturing capacity, support supply chains, and provide fiscal and policy incentives

Q20. Which scheme or mechanism helps startups and MSMEs commercialize technologies developed in academic institutions and public labs?

• Technology Transfer and incubation initiatives under government programs such as Atal and DPIIT-linked incubation
• Direct government takeover of intellectual property
• Mandatory licensing without compensation
• Only private venture capital with no government involvement

Correct Answer: Technology Transfer and incubation initiatives under government programs such as Atal and DPIIT-linked incubation

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