In the question a statement is given, followed by two arguments, I and II. You have to consider the statement to be true even if it seems to be at variance from commonly known facts. You have to decide which of the given arguments, if any, is a strong argument.
Statement : Should Chinese crackers be banned?
Argument I : No, China will be hurt by this decision.
Argument II : Yes, crackers kill insects.
Whether cracker kills insects or not, that's a different issue and should not effect the ban on crackers and similar criteria applies for the first argument.
Thus, neither I nor II is strong.
=> Ans - (D)
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