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Option 1 states that India is the largest consumer of sugar in the world. This is correct. India has a large population, and its consumption of sugar is high.
Option 2 states that the issue price of sugar under PDS (Public Distribution System) was raised to Rs. 13 per kg in the Union Budget 2000-2001. This statement is correct. The Union Budget is an annual budget presented by the Government of India, and in the year 2000-2001, the issue price of sugar under the PDS was indeed increased to Rs. 13 per kg.
Option 3 states that Uttar Pradesh contributes half of the country`s sugar output. This statement is also correct. Uttar Pradesh is the largest sugarcane-producing state in India, and it accounts for approximately half of the country`s overall sugar output.
Therefore, both statements 1 and 2 are correct, making option 2 the correct answer. The statement in option 3 is also correct, but it is not the only correct statement.