Question

Out of the following, India earns the maximum foreign exchange from the export of
A. Leather
B. Rubber
C. Iron
D. Electronic goods

Answer 1

Hint: The conversion of the currency of one country to the currency of another is called foreign exchange. When goods or services produced in one country are sold to another country is known as export. And the exchange value can be determined by the market.

Complete answer:
Out of the given options, the industry in which India earns its maximum foreign exchange is Iron industry. The value of iron metal traded from India added up to almost 186 billion rupees in the financial year 2020. This fare esteem was altogether higher than the past money related year's estimation of around 92 billion rupees.

Additional information:
Recently, India exported mostly vehicles, parts and accessories (5 percent); nuclear reactors, boilers, machinery and mechanical appliances (5 percent); pharmaceutical products (5 percent); and organic chemicals (4 percent), mineral fuels, oils and waxes and bituminous substances (12 percent), pearls, precious and semi-precious stones and jewellery (16 percent of total shipments).
India’s main export partners are: United Kingdom (3 percent), China (4 percent), Singapore (4 percent), Hong Kong (5 percent), United Arab Emirates (11 percent) and the United States (15 percent).

Hence, the correct answer is option C.

Note:
The exchange rate effect the trade deficit or trade surplus, which then affects the exchange rate, and so on. However, a weaker domestic currency specifies exports and makes imports more expensive. A strong domestic currency hampers exports and makes imports cheaper.