Flash Notes: ECONOMY HQ: Ground Floor, Apsara Arcade, ORN, New Delhi-05 80765 17832 1

Dear students, FLASH NOTES

FOR UPSC PRELIMS

The “Flash Notes for Dominate Prelims”

on Economy is your ultimate weapon to
tackle one of the most concept-heavy and
unpredictable sections of UPSC Prelims.
With a deep dive into over 120 PYQs (2015–2024), this
book systematically covers key economic themes,
including GDP, inflation, fiscal and monetary policies,
banking reforms, financial markets, and global economic
trends.

What makes this book stand out is its Microtheme

Analysis, which identifies recurring trends in UPSC
Prelims questions and highlights high-priority topics like
GDP calculation, tax-to-GDP ratio, fiscal stimulus, Basel
norms, and monetary policy instruments. Additionally,
current economic developments, such as India’s
projected $7 trillion economy by FY30, RBI’s evolving
monetary policies, and the role of AI in banking, ensure
aspirants remain updated with exam-relevant content.

With structured tables, crisp explanations, and easy-

to-revise formats, this book ensures quick retention
and efficient preparation. Whether you are struggling
with concepts like devaluation, fiscal deficits, financial
inclusion, or global economic reports, this book provides
the clarity and precision needed to excel in UPSC
Prelims.

Drop in your comments and

suggestions to us at [email protected]

Best,
Civilsdaily IAS’ Dominate Prelims Team

Flash Notes: ECONOMY HQ: Ground Floor, Apsara Arcade, ORN, New Delhi-05 80765 17832 2
Prelims PYQs Microthemes Distribution
262 Question Count
2010-2024

Souce: CD PYQ Microtheme Tool

The concept: Microthemes are recurring patterns observed in the last 20

years of UPSC Prelims papers. These represent predictable, high-yield areas
and should be your Priority 1. Focus on them specifically, as you should
expect questions from these topics. Only move on to other topics after you
have thoroughly mastered the Microthemes.

These Flash Notes simplified complex UPSC Syllabus

into microthemes, making my Prelims journey
efficient and result-oriented—highly recommended
for every aspirant!
- AIR 2, Animesh Pradhan

With Flash Notes, I could pinpoint high- Crisp, focused, and packed with microtheme
yield microthemes and streamline my insights—Flash Notes transformed how you
revision, making Prelims prep smarter, approach Prelims, ensuring clarity on First-priority
not harder! topics.
- IRMS, Sreelaxmi KV - AIR 48, Aaditya Pandey
UPSC 2023

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Flash Notes: ECONOMY HQ: Ground Floor, Apsara Arcade, ORN, New Delhi-05 80765 17832 4
 Table of Contents
1. GDP, INFLATION AND DEFLATION 7 5. BANKING AND FINANCIAL SECTOR 21
1.1 Economic Indicators and Various Reports On It- GDP, FD, EODB, WIR etc 8 5.1 NPA Crisis 22
1.1.1 Global Finance Central Banker Report Cards, 2024 5.1.1 Asset Reconstruction Companies (ARCs)
1.2 Chhattisgarh first state to link Forest Ecosystem with Green GDP 8 5.2 Insolvency and Bankruptcy Code 22
1.3 India’s Inflation Dilemma: RBI’s Tightrope Walk Between Growth and Stability 8 5.2.1 Insolvency and Bankruptcy Board of India (IBBI)
1.4 CRISIL Report highlights volatility in vegetable prices as a Persistent 5.3 Banking Sector Reforms 23
Economic Challenge 8 5.3.1 National Urban Cooperative Finance and Development Corporation
1.5 GDP growth rate slumps to near two-year low of 5.4% in July-Sept 9 Limited (NUCFDC):
1.6 Karnataka’s Remarkable Economic Ascent 9 5.3.2 Basel III Endgame
1.7 India’s GDP projected to double to $7 Trillion by FY30-31, becoming the 5.3.3 Domestic Systemically Important Banks (D-SIBs)
World’s Third-Largest Economy 9 5.3.4 India Post Payments Bank (IPPB)
5.4 Microfinance Story of India 24
2. UNEMPLOYMENT 10 5.4.1 MUDRA 2.0 Loans
2.1 Unemployment in India: Trends and Challenges 10 5.4.2 Pradhan Mantri Mudra Yojana (PMMY)
2.2 Start-up Ecosystem In India 10
2.2.1 BHASKAR Platform 6. CAPITAL MARKETS 25
2.2.2 Ten years of Street Vendors Act, 2014 6.1 ‘Hot Money’ Inflows 26
6.2 T + 0 Settlement 26
3. FISCAL POLICY 12 6.3 SCORES 2.0 to Strengthen Investor Redressal 26
3.1 Finance Commission – Issues related to devolution of resources 12 6.4 Mutual Funds 26
3.2 Tax Reforms 13 6.5 Equity Linked Savings Schemes (ELSS) 26
3.2.1 Angel Tax scrapped in Budget 2024 6.6 Sovereign Gold Bond (SGB) Scheme 27
6.7 Future and Options (F&O) 27
4. RBI & MONETARY POLICY 14 6.8 Passive Mutual Funds 27
4.1 Historical Perspectives 15 6.9 Climate Finance Taxonomy 27
4.1.1 Ninety years of the Reserve Bank of India (RBI)
4.2 Regulatory Framework and Guidelines 16 7. TRADE 28
4.2.1 RBI Circular on Liberalised Remittance Scheme (LRS) 7.1 Trade Sector Updates – Falling Exports, TIES, MEIS, Foreign Trade Policy,
4.2.2 RBI updates the Framework related to Regulatory Sandbox scheme etc. 29
4.2.3 Scale-Based Regulation of NBFCs 7.1.1 European Free Trade Association (EFTA) Bloc
4.2.4 Asset Reconstruction Companies (ARCs) 7.1.2 India signs Trade Pact with EFTA
4.2.5 Curbs on Paytm Payments Banks 7.1.3 UNCTAD Global Trade Report, 2024
4.2.6 State ‘Guarantees’ on Borrowings 7.1.4 Anti-Dumping Duty
4.3 Monetary Policy and Financial Instruments 18 7.1.5 Netherlands becomes India’s 3rd Largest Export Destination in 2023-24
4.3.1 CRR on Green Deposits 7.1.6 Yen Carry Trade
4.3.2 Central Bank Digital Currency (CBDC) 7.1.7 SCOMET List
4.3.3 Retail Direct Scheme 7.2 Intellectual Property Rights in India 30
4.4 Digital Payments and FinTech Initiatives 18 7.2.1 Passing off under Trademark Rules
4.4.1 DIGITA to check Illegal Lending Apps 7.2.2 India Club P&I Entity
4.4.2 PRAVAAH Retail Direct mobile app 7.2.3 RoDTEP Scheme
4.4.3 Special Rupee Vostro Account (SRVA)
4.4.4 RBI joins Project Nexus 8. INDUSTRY 32
4.5 International Financial Operations 19 8.1 Make in India: Challenges & Prospects 33
4.5.1 RBI Repatriates Gold Reserves from UK 8.1.1 Ten years of Make in India
4.5.2 Surge in Indian Companies’ External Commercial Borrowings (ECBs) 8.2 Industrial Sector Updates –
4.6 Reports and Publications 20 Industrial Policy, Ease of Doing Business, etc. 33
4.6.1 Report on Currency and Finance (RCF) 8.2.1 Index of Industrial Production (IIP)
8.2.2 HAL becomes 14th Maharatna Company
8.2.3 Organisation for the Prohibition of Chemical Weapons (OPCW)-The
Hague Award:

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8.3 Textile Sector – Cotton, Jute, Wool, Silk, Handloom, etc. 34 10.4.2 Green Ammonia Production under SIGHT Program
8.3.1 Eri Silk 10.4.3 International Partnership for Hydrogen and Fuel Cells in the Economy
8.3.2 SAMARTH Scheme (IPHE)
8.4 Electronic System Design & Manufacturing Sector – M-SIPS, National Policy on 10.4.4 Vijaipur Green Hydrogen Plant in Madhya Pradesh
Electronics, etc. 34 10.4.5 India’s First Hydrogen Fuel Cell Ferry
8.4.1 India Semiconductor Mission (ISM) 10.5 Coal and Mining Sector 49
8.5 Corporate Social Responsibility: Issues & Development 34 10.5.1 Coal Controller’s Organisation (CCO)
8.5.1 CIL ASHIS Scheme 10.5.2 Grade of Coal in India
8.6 Defence Sector – DPP, Missions, Schemes, Security Forces, etc. 35 10.5.3 District Mineral Foundation (DMF)
8.6.1 ADITI Scheme 10.6 Oil and Gas Sector – HELP, Open Acreage Policy, etc. 50
10.6.1 India’s First Oil Production in K-G Basin
9. INFRASTRUCTURE 36 10.7 Nuclear Energy 50
9.1 Roads and Highways 37 10.7.1 Nuclear Wastes
9.1.1 Mumbai Trans Harbour Link 10.8 Policy Wise: Power Sector 50
9.1.2 India’s Longest Cable-Stayed Bridge ‘Sudarshan Setu’ 10.8.1 Central Electricity Regulatory Commission (CERC)
9.1.3 Sela Tunnel 10.8.2 International Energy Agency (IEA):
9.1.4 Z-Morh Tunnel Project
9.2 Rural Infrastructure Schemes 38 11. AGRICULTURE AND ALLIED SECTORS 52
9.2.1 PM Gram Sadak Yojana- Phase IV 11.1 Agricultural Policies and Reforms 53
9.3 Railways 38 11.1.1 Spices Board of India
9.3.1 Kalka-Shimla Heritage Railway Track 11.1.2 Kisan Credit Card (KCC) Fisheries Scheme
9.3.2 Kolkata Underwater Metro Tunnel 11.1.3 Agricultural Infrastructure Fund (AIF) Scheme
9.3.3 Banihal-Sangaldan Railway Line 11.1.4 Minimum Support Price (MSP)
9.4 Port Infrastructure and Shipping Industry – 11.1.5 Price Stabilization Fund (PSF)
Sagarmala Project, SDC, CEZ, etc. 39 11.1.6 Cabinet approves continuation of PM-AASHA
9.4.1 Paradip Port 11.1.7 National Agriculture Code (NAC)
9.4.2 Great Nicobar Island (GNI) Project 11.1.8 Statistical Report on Value of Output from Agriculture and Allied
9.4.3 Approval of Major Port at Vadhavan Sectors 2024
9.4.4 Bihta Inland Container Depot (ICD) 11.1.9 Golden Rice
9.5 Civil Aviation and Air Cargo 41 11.1.10 PM-KISAN Scheme
9.5.1 Twenty-one Greenfield Airports are to be set up in the country, 11 are 11.2 Horticulture, Floriculture, Commercial crops, Bamboo Production – MIDH,
operationalized NFSM-CC, etc. 56
(https://pib.gov.in/PressReleaseIframePage.aspx?PRID=1906346) 11.2.1 CDP-SURAKSHA Digital Platform
9.5.2 DigiYatra Initiative 11.2.2 Atmanirbhar Clean Plant Programme (CPP)
9.5.3 Asia Pacific Ministerial Conference on Civil Aviation (APMCCA) 11.2.3 Asia Tea Alliance (ATA)
9.6 Water Management – Institutional Reforms, Conservation Efforts, etc. 42 11.2.4 Coffee Board of India
9.6.1 Nohar Irrigation Project 11.2.5 Growth in Ashwagandha Exports
9.6.2 Kiru Hydel Project 11.2.6 Jute Production in India
9.6.3 Pancheshwar Multipurpose Project (PMP) 11.2.7 Fair and Remunerative Price (FRP) of Sugarcane
9.6.4 Bhu-Neer Portal 11.3 Animal Husbandry, Fisheries, and Livestock 58
9.7 River Interlinking 43 11.3.1 Punganur Dwarf Cows
9.8 Coastal Zones Management and Regulations 43 11.3.2 PM Matsya Kisan Samridhi Sah-Yojana (PM-MKSSY)
9.8.1 National Coastal Mission Scheme (NCM) 11.3.3 Foot and Mouth Diseases in Cattles
9.9 Telecom and Postal Sector – Spectrum Allocation, Call Drops, Predatory 11.3.4 21st National Livestock Census, 2024
Pricing, etc 44 11.4 Technology and Digital Agriculture 59
9.9.1 Chakshu and Digital Intelligence Platform (DIP) 11.4.1 National Pest Surveillance System (NPSS)
9.9.2 Direct-to-Mobile (D2M) Broadcasting 11.4.2 Digital Agriculture Mission
9.9.3 Kochi-Lakshadweep Islands Submarine Optical Fiber Connection (KLI- 11.4.3 NABARD Blended Fund for Agri-Startups
SOFC) Project 11.5 Food Security, Processing, and Exports 59
9.10 Electric and Hybrid Cars – FAME, National Electric Mobility Mission, etc. 11.5.1 Food Corporation of India (FCI)
 45 11.5.2 National Mission on Edible Oils – Oilseeds (NMEO-Oilseeds)
9.10.1 PM E-Drive Scheme 11.5.3 Import Tax on Edible Oils
9.11 Digital India Initiatives 45 11.5.4 National Mission on Edible Oils – Oil Palm (NMEO-OP)
9.11.1 DigiReady Certification 11.5.5 FSSAI Mandate on Fruit Juice Labeling
11.6 Fertilizer and Sustainable Practices 60
10. ENERGY AND RESOURCES 46 11.6.1 Expansion of Nano DAP
10.1 Renewable Energy – Wind, Solar, Tidal, Geothermal, etc. 46 11.6.2 Nutrient Based Subsidy (NBS) Scheme
10.1.1 VGF Scheme for Offshore Wind Energy Projects 11.7 Agricultural Trade and Export Development 61
10.2 Solar Energy – JNNSM, Solar Cities, Solar Pumps, etc. 47 11.7.1 Spices Board of India
10.2.1 PM Surya Ghar Muft Bijli Yojana 11.7.2 Tobacco: The Silent Killer
10.2.2 Model Solar Village 11.7.3 Global Pulse Confederation (GPC)
10.2.3 India is now 3rd-Largest Producer of Solar Power 11.7.4 India’s Surge in Pulses Imports
10.3 Biofuel Policy 47 11.8 Geographical Indication (GI) and Indigenous Crops 62
10.3.1 Sustainable Aviation Fuel (SAF) 11.8.1 King Chilli Festival
10.3.2 BioE3 Policy 11.8.2 Nanjangud Rasabale Banana
10.4 Green Hydrogen 48
10.4.1 SIGHT Program for Green Hydrogen Transition

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1. GDP, INFLATION AND DEFLATION
Prelims PYQs
[UPSC CSE 2010] In the context of the Indian economy, [UPSC CSE 2013] The national income of a country for a given
consider the following pairs: period is equal to the
Term → Most appropriate description (a) T otal value of goods and services produced by the nationals
1.Melt down → Fall in stock prices (b) S um of total consumption and investment expenditure
2.Recession → Fall in growth rate (c) Sum of personal income of all individuals
3.Slow down → Fall in GDP (d) Money value of final goods and services produced
Which of the pairs given above are correct?
(a) 1 only [UPSC CSE 2018] Despite being a high-saving economy, capital
(b) 2 and 3 only formation may not result in a significant increase in output due to
(c) 1 and 3 only (a) W eak administrative machinery
(d) 1, 2, and 3 (b) Illiteracy
(c) High population density
[UPSC CSE 2010] With reference to the Indian economy, consider (d) High capital-output ratio
the following statements:
1. The Gross Domestic Product (GDP) has increased by four times in [UPSC CSE 2013] Economic growth in country X will necessarily
the last 10 years. have to occur if
2. The percentage share of the Public Sector in GDP has declined in (a) T
 here is technical progress in the world economy
the last 10 years. (b) T
 here is population growth in X
Which of the statements given above is/are correct? (c) T
 here is capital formation in X
(a) 1 only (d) T
 he volume of trade grows in the world economy
(b) 2 only
(c) Both 1 and 2
(d) Neither 1 nor 2 [UPSC CSE 2021] Consider the following statements:
The effect of devaluation of a currency is that it necessarily:
[UPSC CSE 2011] The term “Gresham’s Law” is often mentioned in 1. Improves the competitiveness of domestic exports in foreign
the context of economics. What does it state? markets.
(a) B ad money drives out good money when both are in circulation. 2. Increases the foreign value of domestic currency.
(b) Good money drives out bad money when both are in circulation. 3. Improves the trade balance.
(c) Inflation drives out deflation in the economy. Which of the above statements is/are correct?
(d) Market competition drives out inefficient producers. (a) 1 only
(b) 1 and 2
[UPSC CSE 2011] In the context of the Indian economy, consider the (c) 3 only
following statements: (d) 2 and 3
1. The growth rate of GDP has steadily increased in the last five years.
2. The growth rate in per capita income has steadily increased in the [UPSC CSE 2022] With reference to the Indian economy, consider
last five years. the following statements:
Which of the statements given above is/are correct? 1. An increase in the Nominal Effective Exchange Rate (NEER)
(a) 1 only indicates the appreciation of the rupee.
(b) 2 only 2. A  n increase in the Real Effective Exchange Rate (REER) indicates
(c) Both 1 and 2 an improvement in trade competitiveness.
(d) Neither 1 nor 2 3. An increasing trend in domestic inflation relative to inflation in
other countries is likely to cause an increasing divergence between
[UPSC CSE 2018] Increase in absolute and per capita real GNP does NEER and REER.
not connote a higher level of economic development, if Which of the above statements are correct?
(a) Industrial output fails to keep pace with agricultural output. (a) 1 and 2 only
(b) Agricultural output fails to keep pace with industrial output. (b) 2 and 3 only
(c) Poverty and unemployment increase. (c) 1 and 3 only
(d) Imports grow faster than exports. (d) 1, 2 and 3

[UPSC CSE 2015] A decrease in the tax-to-GDP ratio of a country

indicates which of the following?
1. Slowing economic growth rate
2. Less equitable distribution of national income
Select the correct answer using the code given below:
(a) 1 only
(b) 2 only
(c) Both 1 and 2
(d) Neither 1 nor 2

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1.1 Economic Indicators and Various Reports On It- GDP, FD, EODB, WIR etc
1.1.1 Global Finance Central Banker Report Cards, 2024
• R BI Governor received an “A+” rating for the second year in a row • R
 atings range from “A+” for excellent to “F” for failure.
in the Global Finance Central Banker Report Cards 2024. • G
 rades are based on inflation control, economic growth, currency
• The report is published annually by Global Finance magazine, stability, and interest rate management.
grading central bank governors since 1994. • R
 ecognition underscores the Governor’s success in managing
• Covers nearly 100 countries, territories, and districts, including India’s monetary policy effectively.
major institutions like the EU and various regional central banks. The Economic Times

1.2 Chhattisgarh first state to link Forest Ecosystem with Green GDP
• C hhattisgarh’s Initiative: The state has become the first in India to • A
 ssessment of Ecosystem Services: The state will evaluate:
integrate its forest ecosystem services into Green GDP. - C
 O₂ absorption by trees.
• Objective: This initiative quantifies the environmental contribu- - E
 conomic value of water provided by forests.
tions of forests—such as clean air, water conservation, and - E
 cological balance maintained by forest fauna.
biodiversity—and incorporates them into the state’s economic • Policy Implication: By linking forest benefits to Green GDP, the
planning. state aims to enhance budget allocation, sustainable develop-
• Significance: With 44% forest cover, Chhattisgarh aims to recog- ment, and policy-making.
nize the role of forests in supporting livelihoods, carbon absorp- New Indian Express
tion, and climate change mitigation.

1.3 India’s Inflation Dilemma: RBI’s Tightrope Walk Between Growth and Stability
• Inflation Trends and the Current Scenario tionary concerns, making India vulnerable to external shocks.
- Retail inflation has been on a downward trend, dropping from - D omestically, food inflation remains volatile, with sup-
6.21% in October to 5.48% in November, and further to ply-side disruptions affecting essential commodities.
5.22% in December. • P
 olicy Options for the RBI
- While this decline is a positive sign, inflation remains above - T he RBI might hold off on rate cuts for now, despite industry
the RBI’s comfort level of 4%, making it a key concern for calls for lower borrowing costs.
policymakers. - A carefully calibrated approach—such as targeted liquidity
• RBI’s Policy Dilemma adjustments and supply-side interventions—could help tackle
- The Reserve Bank of India (RBI) is caught between con- inflation without derailing growth.
trolling inflation and sustaining economic growth. • F
 uture Outlook
- Raising interest rates to curb inflation could slow down credit - Inflation is likely to remain a key policy focus in 2025, espe-
growth, consumption, and investments, impacting India’s cially with global uncertainties affecting commodity prices.
economic momentum. - T he Union Budget 2025 and upcoming monetary policy
- Keeping rates unchanged could lead to persistent price decisions will play a crucial role in shaping the inflation
pressures, especially in food and fuel sectors. trajectory.
• External and Domestic Challenges Indian Express
- Global oil prices and a weakening rupee are adding to infla-

1.4 CRISIL Report highlights volatility in vegetable prices as a Persistent Economic Challenge
• Significance of Vegetables in the Food Index: measures to stabilize vegetable prices, including:
- Vegetables constitute 15.5% of the food index, ranking as - E nhancing supply chain efficiency to reduce bottle-
the third-largest component after cereals and milk. necks.
- They are identified as the most volatile segment within the - Investing in agricultural infrastructure to mitigate the
food index. effects of adverse weather.
• Impact on Inflation and Economy: - P romoting diversification in crop production to ensure a
- The high volatility in vegetable prices contributes significantly steady supply of various vegetables.
to overall inflation fluctuations, complicating economic • Broader Economic Implications:
planning and policy formulation. - Addressing vegetable price volatility is crucial for maintain-
- S uch unpredictability poses challenges for both consumers ing consumer purchasing power and ensuring economic
and policymakers, affecting household budgets and economic stability.
stability. - S table vegetable prices can lead to more predictable inflation
• Underlying Causes of Price Volatility: rates, aiding in effective economic planning and policy imple-
- F actors such as seasonal variations, supply chain disrup- mentation.
tions, and weather-related issues are primary contributors Indian Express
to the instability in vegetable prices.
- These elements lead to frequent and unpredictable price
changes, impacting the cost of living and economic forecasts.
• Policy Recommendations: The report suggests implementing

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1.5 GDP growth rate slumps to near two-year low of 5.4% in July-Sept
• GDP Growth Decline: uting to the overall economic slowdown.
- India’s real Gross Domestic Product (GDP) growth fell to 5.4% • C
 ontributing Factors:
in the July-September 2024 quarter, marking the lowest - W
 eak Domestic Demand: A decline in consumer spending
rate in seven quarters. has adversely affected manufacturing output.
• Sectoral Performance: - G
 lobal Economic Conditions: External factors, including
- Manufacturing: Growth slowed to 2.2%, indicating a signifi- global economic uncertainties, have impacted export demand,
cant deceleration in industrial activity. affecting both manufacturing and mining sectors.
- Mining: The sector experienced a contraction, further contrib- Indian Express

1.6 Karnataka’s Remarkable Economic Ascent

• Significant Increase in GDP Share: have facilitated business operations and connectivity.
- Karnataka’s contribution to India’s Gross Domestic Product • C
 omparative Economic Performance:
(GDP) has risen from 5.4% in 1960-61 to 8.2% in 2023-24, - K
 arnataka’s GDP share growth outpaces many other Indian
marking a substantial growth of approximately 51% over five states, reflecting its dynamic economic strategies and favor-
decades. able business environment.
• Key Drivers of Economic Growth: • P
 olicy and Governance Factors:
- Information Technology (IT) and Biotechnology: Bengaluru, - P
 roactive government policies, including investment-friendly
the state capital, has emerged as a major hub for IT and bio- regulations and support for innovation, have been instrumen-
technology, attracting significant investments and talent. tal in driving the state’s economic success.
- Manufacturing and Industry: The state has developed ro- • F
 uture Outlook:
bust industrial sectors, including aerospace, automotive, and - S
 ustaining this growth trajectory will require continued focus
textiles, contributing to its economic expansion. on education, skill development, and sustainable practices to
- Infrastructure Development: Continuous improvements in maintain competitiveness and inclusivity.
infrastructure, such as transportation and urban development, Indian Express

1.7 India’s GDP projected to double to $7 Trillion by FY30-31, becoming the World’s
Third-Largest Economy
• Projected Economic Growth: required to upgrade transportation, energy, and communica-
- According to S&P Global, India’s nominal Gross Domestic tion networks.
Product (GDP) is expected to nearly double from $3.6 trillion - S
 kill Development: Enhancing education and vocational
in FY2023-24 to over $7 trillion by FY2030-31, positioning training programs is essential to meet the demands of a
India as the world’s third-largest economy. modern economy.
• Key Drivers of Growth: - C
 limate Change: Addressing environmental concerns and
- Demographic Dividend: A young and expanding workforce is implementing sustainable practices are crucial for long-term
anticipated to boost productivity and consumption. growth.
- Urbanization: Continued migration to urban areas is likely to • G
 lobal Economic Standing:
stimulate infrastructure development and economic activities. - S
 urpassing economies such as Germany and Japan, India
- Digitalization: Rapid adoption of digital technologies is ex- is projected to become the third-largest economy globally,
pected to enhance efficiency across various sectors. following the United States and China.
• Challenges Ahead: Indian Express
- Infrastructure Development: Significant investments are

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2. UNEMPLOYMENT
Prelims PYQs
[UPSC CSE 2013] To obtain full benefits of demographic dividend, [UPSC CSE 2018] Increase in absolute and per capita real GNP do
what should India do? not connote a higher level of economic development, if:
(a) Promoting skill development (a) Industrial output fails to keep pace with agricultural output.
(b) Introducing more social security schemes (b) A gricultural output fails to keep pace with industrial output.
(c) Reducing infant mortality rate (c) Poverty and unemployment increase.
(d) Privatization of higher education (d) Imports grow faster than exports.

[UPSC CSE 2013] Economic growth in country X will necessarily [UPSC CSE 2020] With reference to the Indian economy after the
have to occur if: 1991 economic liberalization, consider the following statements:
(a) There is a technical progress in the world economy 1. W
 orker productivity (Rupee per worker at 2004-05 prices)
(b) There is population growth in X increased in urban areas while it decreased in rural areas.
(c) T here is capital formation in X 2. T he percentage share of rural areas in the workforce steadily
(d) The volume of trade grows in the world economy increased.
3. In rural areas, the growth in non-farm economy increased.
[UPSC CSE 2014]The main objective of the 12th Five-Year Plan is: 4. The growth rate in rural employment decreased.
(a) Inclusive growth and poverty reduction. Which of the statements given above is/are correct?
(b) Inclusive and sustainable growth. (a) 1 and 2 only
(c) Sustainable and inclusive growth to reduce unemployment. (b) 3 and 4 only
(d) Faster, sustainable and more inclusive growth. (c) 3 only
(d) 1, 2 and 4 only

2.1 Unemployment in India: Trends and Challenges

Section Details
Unemployment Rate As of September 2024, India’s unemployment rate stood at 7.8%, down from 8.5% in August 2024.
Labour Participation Rate It fell from 41.6% to 41% during the same period.
Employment Rate Decreased slightly from 38% to 37.8%.
Youth Unemployment - Only 37% of youth (aged 15–24) were engaged in economic activities in 2022.
- Delayed entry into the workforce and lack of job opportunities are key contributing factors.
Gender Disparities - Female labour force participation remains low at 20%-25%, compared to 55%-60% for men.
Underemployment and - Around 80-90% of the workforce is engaged in the informal sector, lacking job security and
Informal Economy benefits.
Forbes

2.2 Start-up Ecosystem In India

2.2.1 BHASKAR Platform
• F ull name: Bharat Startup Knowledge Access Registry (BHASKAR) • E ncourages cross-border collaborations and promotes India’s
• Launched by DPIIT under the Ministry of Commerce and Industry. global innovation presence.
• Aim: Strengthen India’s startup ecosystem by centralizing re- • A s of May 2023, India has over 99,000 recognized startups, mak-
sources and fostering collaboration. ing it the third-largest globally.
• Personalized BHASKAR IDs: Unique IDs for startups, investors, • This is a rise from 84,012 startups in 2022 and just 452 in 2016.
and mentors for tailored services. • India has produced 108 unicorns, valued at $340.80 billion
• Users can easily find resources, collaborators, and opportunities. CD

2.2.2 Ten years of Street Vendors Act, 2014

Objective: To protect the rights and livelihoods of street vendors, ensuring they cannot be evicted or harassed arbitrarily.
regulate street vending activities, and provide a framework for resolv- • T
 own Vending Committees (TVCs): Requires the establishment of
ing disputes and grievances. TVCs with representatives from vendors, local authorities, and civil
Key Provisions: society to oversee vending activities.
• Certificates of Vending: Grants legal recognition to vendors, • D
 esignated Vending Zones: Mandates the creation of specified

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 zones where vendors can operate legally and without disruption. Recent Developments:
• G rievance Redressal Committees (GRCs): Obligates states to • A dvocacy by groups like the National Association of Street Ven-
set up committees to resolve disputes involving vendors, local dors of India (NASVI) has highlighted these challenges, urging states
authorities, & police. to expedite the formation of GRCs.
• Prohibition of Arbitrary Eviction: Protects vendors from being • Some states have initiated steps to implement the Act more effective-
displaced without proper cause and alternative arrangements. ly, but progress is uneven and inconsistent across the country. IE

Pradhan Mantri Street Vendor’s AtmaNirbhar Nidhi (PM SVANidhi)

It is a micro-credit scheme launched by the Government of India on June 1, 2020, under the Ministry of Housing and Urban Affairs (Mo-
HUA).
Objective: To empower street vendors by providing them with affordable working capital loans, enabling them to resume their livelihoods
adversely affected by the COVID-19 pandemic.
Key Features:
• Financial Assistance:
• Offers an initial working capital loan of up to ₹10,000 for a tenure of one year.
• Upon timely repayment, vendors become eligible for higher loan amounts in subsequent cycles, with loans up to ₹20,000 in the sec-
ond cycle and up to ₹50,000 in the third cycle.
• Interest Subsidy:
• Provides a 7% annual interest subsidy on timely or early repayment of the loan, credited quarterly to the beneficiary’s account.
• Digital Transactions Incentive:
• Encourages digital payments by offering monthly cash-back incentives ranging from ₹50 to ₹100 for conducting digital transactions.

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3. FISCAL POLICY
Prelims PYQs
[UPSC CSE 2010] Which of the following is NOT included in the [UPSC CSE 2016] The primary objective of deficit financing in India
Fiscal Responsibility and Budget Management (FRBM) Act, 2003? is to:
(a) Elimination of revenue deficit (a) Adjust balance of payments
(b) Reduction of fiscal deficit (b) Finance economic development
(c) Fixing government guarantees as a percentage of GDP (c) Reduce foreign debt
(d) Prohibition of external borrowing by the government (d) Reduce government expenditure

[UPSC CSE 2011] A decrease in the tax-to-GDP ratio of a country [UPSC CSE 2017] The “Goods and Services Tax (GST)” was
indicates: introduced in India primarily to:
(a) A slowing economic growth rate (a) Reduce India’s current account deficit
(b) Increased government spending (b) Replace multiple indirect taxes with a unified tax structure
(c) Reduction in fiscal deficit (c) Improve the country’s foreign exchange reserves
(d) Higher collection of indirect taxes (d) Increase customs revenue from imports

[UPSC CSE 2013] Which of the following measures can be taken to [UPSC CSE 2018] Which of the following is a component of Capital
reduce the fiscal deficit? (2013) Budget in the Indian Government’s Fiscal Policy?
1. Reducing revenue expenditure 1. E
 xpenditure on roads and infrastructure
2. Introducing new welfare schemes 2. L oans received from foreign governments
3. Rationalizing subsidies 3. Salaries paid to government employees
4. Increasing import duties 4. Interest payments on government debt
Select the correct answer using the code below: Select the correct answer using the codes below:
(a) 1 and 3 only (a) 1 and 2 only
(b) 2 and 3 only (b) 2 and 3 only
(c) 1, 3, and 4 only (c) 1 and 4 only
(d) 1, 2, 3, and 4 (d) 1, 2, and 4

[UPSC CSE 2014] What is the primary aim of a fiscal stimulus [UPSC CSE 2020] The Fiscal Responsibility and Budget
package? Management (FRBM) Act, 2003 was enacted to:
(a) Increase interest rates to stabilize inflation (a) Eliminate fiscal and revenue deficits.
(b) Reduce government expenditure to lower fiscal deficit (b) P romote deficit financing by borrowing from the RBI.
(c) Increase government spending to boost economic activity (c) Reduce dependence on direct taxes for revenue.
(d) Reduce subsidies and welfare schemes (d) Increase the money supply in the economy.

[UPSC CSE 2015] In India, which of the following is considered a [UPSC CSE 2023] Which of the following statements regarding
direct tax? Fiscal Policy in India is correct?
1. Income Tax (a) F
 iscal Policy is formulated and implemented by the Reserve Bank
2. Corporation Tax of India.
3. Customs Duty (b) F
 iscal Policy deals primarily with the regulation of money supply
4. Goods and Services Tax (GST) and inflation control.
Select the correct answer using the code below: (c) F
 iscal Policy involves taxation, government spending, and public
(a) 1 and 2 only debt management.
(b) 3 and 4 only (d) F
 iscal Policy is concerned with controlling interest rates and
(c) 1, 3, and 4 only liquidity in the economy.
(d) 1, 2, 3, and 4

3.1 Finance Commission – Issues related to devolution of resources

3.1.1 Vertical Fiscal Imbalance (VIF) • R
 epresents the portion of sub-national governments’ spending that
• Refers to the mismatch between the revenue-raising powers and is not covered by their own revenues.
expenditure responsibilities of different levels of government, par- • R
 esults from a fiscal gap caused by improper decentralization of
ticularly between the Union and state governments. public revenue and expenditure.
Key Characteristics: The Hindu
• Occurs when states’ expenditure responsibilities significantly
exceed their revenue-raising powers.

Flash Notes: ECONOMY HQ: Ground Floor, Apsara Arcade, ORN, New Delhi-05 80765 17832 12
3.2 Tax Reforms
3.2.1 Angel Tax scrapped in Budget 2024
• T he Finance Minister announced the abolition to strengthen the
startup ecosystem and support innovation in India.
• Changes to the angel tax system will take effect on April 1, 2025.
• Introduced in 2012 under the Finance Act, it falls under Section
56 (II) (viib) of the Income Tax Act, 1961.
• Imposes tax on funding raised by unlisted companies if their val-
uation exceeds the company’s fair market value (FMV).
• FMV is the price set for selling or purchasing an asset in the
open market.
• Excess amount is treated as income and taxed at 30.9%.
• It aimed to curb money laundering and prevent tax avoidance.
• Reasons for scrapping: Reduce compliance burden for startups.
• The assessing officer used the discounted cash flow (DCF)
method to determine FMV, seen as unfavorable for startups.
• DCF evaluates investment by discounting estimated future cash
flows.
• Abolishing the angel tax aligns with the government’s Startup
India initiative.
The Hindu

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4. RBI & MONETARY POLICY
Prelims PYQs
[UPSC CSE 2010] Which one of the following terms indicates a [UPSC CSE 2015] With reference to the Indian economy, consider
mechanism used by commercial banks for providing credit to the the following:
government? (1) Bank Rate
(a) Cash Credit Ratio (2) Open Market Operations
(b) Debt Service Obligation (3) Public Debt
(c) Liquidity Adjustment Facility (4) Public Revenue
(d) Statutory Liquidity Ratio Which of the above is/are component(s) of Monetary Policy?
(a) 1 only
[UPSC CSE 2010] When the Reserve Bank of India announces an (b) 2, 3, and 4
increase in the Cash Reserve Ratio (CRR), what does it mean? (c) 1 and 2 only
(a) The commercial banks will have less money to lend (d) 1, 3, and 4
(b) The Reserve Bank of India will have less money to lend
(c) The Union government will have less money to lend [UPSC CSE 2016] The establishment of ‘Payment Banks’ is being
(d) The commercial banks will have more money to lend allowed in India to promote financial inclusion. Which of the following
statements is/are correct in this context?
[UPSC CSE 2012] The Reserve Bank of India (RBI) acts as a bankers’ 1. Mobile telephone companies and supermarket chains that are
bank. This would imply which of the following? owned and controlled by residents are eligible to be promoters of
1. Other banks retain their deposits with the RBI Payment Banks.
2. The RBI lends funds to the commercial banks in times of need 2. P ayment Banks can issue both credit cards and debit cards.
3. T he RBI advises the commercial banks on monetary matters 3. Payment Banks cannot undertake lending activities.
Select the correct answer using the code below: Select the correct answer using the code below:
(a) 2 and 3 only (a) 1 and 2 only
(b) 1 and 2 only (b) 1 and 3 only
(c) 1 and 3 only (c) 2 only
(d) 1, 2, and 3 (d) 1, 2, and 3

[UPSC CSE 2013] In the context of the Indian economy, ‘Open [UPSC CSE 2017] Which of the following statements is/are correct
Market Operations’ refers to regarding the Monetary Policy Committee (MPC)?
(a) Borrowing by scheduled banks from the RBI 1. It decides the RBI’s benchmark interest rates.
(b) Lending by commercial banks to industry and trade 2. It is a 12-member body including the Governor of RBI and is
(c) Purchase and sale of government securities by the RBI reconstituted every year.
(d) None of the above 3. It functions under the chairmanship of the Union Finance Minister.
Select the correct answer using the code given below:
[UPSC CSE 2013] An increase in the Bank Rate generally indicates (a) 1 only
that the (b) 1 and 2 only
(a) Market rate of interest is likely to fall (c) 3 only
(b) Central Bank is no longer making loans to commercial banks (d) 2 and 3 only
(c) Central Bank is following an easy money policy
(d) Central Bank is following a tight money policy [UPSC CSE 2018] Consider the following statements:
1. The Reserve Bank of India manages and services Government of
[UPSC CSE 2015] When the Reserve Bank of India reduces the India Securities but not any State Government Securities.
Statutory Liquidity Ratio (SLR) by 50 basis points, which of the 2. T  reasury bills are issued by the Government of India and there are
following is likely to happen? no treasury bills issued by the State Governments.
(a) India’s GDP growth rate increases drastically 3. Treasury bills are issued at a discount from the par value.
(b) Foreign Institutional Investors may bring more capital into our Which of the statements given above is/are correct?
country (a) 1 and 2 only
(c) Scheduled Commercial Banks may cut their lending rates (b) 3 only
(d) It may drastically reduce the liquidity to the banking system (c) 2 and 3 only
(d) 1, 2, and 3
[UPSC CSE 2015] The problem of international liquidity is related to
the non-availability of [UPSC CSE 2019] The money multiplier in an economy increases
(a) Goods and services with which one of the following? (2019)
(b) Gold and silver (a) Increase in the Cash Reserve Ratio
(c) Dollars and other hard currencies (b) Increase in the banking habit of the population
(d) Exportable surplus (c) Increase in the Statutory Liquidity Ratio
(d) Increase in the population of the country

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[UPSC CSE 2020] If the RBI decides to adopt an expansionist [UPSC CSE 2023] Consider the following statements:
monetary policy, which of the following would it NOT do? 1. In the post-pandemic recent past, many Central Banks worldwide
1. Cut and optimize the Statutory Liquidity Ratio had carried out interest rate hikes.
2. Increase the Marginal Standing Facility Rate 2. Central Banks generally assume that they have the ability to
3. Cut the Bank Rate and Repo Rate counteract the rising consumer prices via monetary policy means.
Select the correct answer using the code below: Which one of the following is correct in respect of the above
(a) 1 and 2 only statements?
(b) 2 only (a) Both Statement-I and Statement-II are correct and Statement-II
(c) 1 and 3 only is the correct explanation for Statement-I
(d) 1, 2, and 3 (b) B  oth Statement-I and Statement-II are correct and Statement-II is
not the correct explanation for Statement-I
[UPSC CSE 2022] With reference to the Indian economy, consider (c) Statement-I is correct but Statement-II is incorrect
the following statements: (d) S  tatement-I is incorrect but Statement-II is correct
1. If inflation is too high, the Reserve Bank of India (RBI) is likely to buy
government securities. [UPSC CSE 2024] Consider the following statements in respect of
2. If the rupee is rapidly depreciating, the RBI is likely to sell dollars in the digital rupee:
the market. 1. It is a sovereign currency issued by the Reserve Bank of India (RBI)
3. If interest rates in the USA or the European Union were to fall, that in alignment with its monetary policy.
is likely to induce the RBI to buy dollars. 2. It appears as a liability on the RBI’s balance sheet.
Which of the statements given above are correct? 3. It is insured against inflation by its very design.
(a) 1 and 2 only 4. It is freely convertible against commercial bank money and cash.
(b) 2 and 3 only Which of the statements given above are correct?
(c) 1 and 3 only (a) 1 and 2 only
(d) 1, 2, and 3 (b) 1 and 3 only
(c) 2 and 4 only
(d) 1, 2, and 4

4.1 Historical Perspectives

4.1.1 Ninety years of the Reserve Bank of India (RBI)
• B .R. Ambedkar’s contributions during the Hilton Young Commis- •O  perated as a privately owned entity until full nationalization in
sion discussions in 1926 laid the foundation for RBI’s establishment 1949.
in 1935. • Key events related to RBI: UPI (2016), Inflation Targeting Framework
• Reserve Bank of India (RBI): Central bank & monetary authori- (2016), BBPS (2019), Aadhar-based eKYC (2019), & ECLGS (2020).
ty established on April 1, 1935, under the RBI Act, 1934. • Central Bank Digital Currency (e₹) (2022) and regulation on cryp-
• Sir Osborne Arkell Smith served as inaugural Governor, succeed- tocurrencies (2022).
ed by Sir C D Deshmukh, the first Indian Governor. • Payment Vision 2025 Document categorizes RBI’s goals
• Centralized institution to regulate monetary & credit policies. into Integrity, Inclusion, Innovation, Institutionalisation, &
• Initially headquartered in Kolkata, permanently moved to Mumbai Internationalisation. The Indian Express
in 1937.

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 India’s 1991 Economic Crisis and the Role of the RBI Governor
Background: In 1991, India faced a severe balance of payments crisis, characterized by a significant current account deficit and
rapidly depleting foreign exchange reserves. This situation was exacerbated by geopolitical events, such as the Gulf War, which led to
increased oil prices and reduced remittances from Indian workers abroad.
Objective: To prevent a default on international payments and stabilize the Indian economy through immediate financial measures
and structural reforms.

Key Measures Implemented:

1. Pledging Gold Reserves:
• Under the leadership of RBI Governor S. Venkitaramanan, India pledged its gold reserves to raise foreign currency.
• In April 1991, 20 tonnes of gold were sold to the Union Bank of Switzerland with a repurchase option, raising $200 million.
• In July 1991, an additional 47 tonnes were shipped to the Bank of England, securing $405 million.
2. Economic Reforms:
• The crisis served as a catalyst for significant economic reforms, including liberalization of trade policies, deregulation of indus-
tries, and financial sector reforms.
• These reforms aimed to open the Indian economy to global markets and improve its competitiveness.
3. Devaluation of the Rupee:
• T o boost exports and improve the trade balance, the Indian rupee was devalued in two stages by approximately 19% in July 1991.

Role of the RBI Governor: Governor S. Venkitaramanan played a pivotal role in managing the crisis by:
• E ngaging with international banks and institutions to raise necessary foreign currency.
• Implementing monetary policies to stabilize the economy.
• C ollaborating with the government to initiate structural reforms.

Outcome: The measures taken during this period were instrumental in averting a default, restoring international confidence, and
setting India on a path of economic liberalization and growth.
TH

4.2 Regulatory Framework and Guidelines

4.2.1 RBI Circular on Liberalised Remittance Scheme (LRS)
 BI has broadened regulations for remittances to IFSCs under
• R shares, debt instruments, and immovable properties overseas;
the Liberalised Remittance Scheme (LRS). • A
 ccounts: Individuals can open and maintain foreign currency
• RBI’s circular authorizes “authorised persons” to facilitate accounts with banks outside India for permitted transactions.
remittances for all permissible purposes under LRS to IFSCs. • E
 xclusions: Not available to corporations, partnership firms, Hindu
• Governed by the FEMA, 1999, regulated by RBI. Undivided Families (HUFs), trusts, etc.
• Introduced by RBI in 2004 to facilitate outward remittances from • P
 rohibited Transactions: Remittances for activities prohibited
India. under Schedule-I of FEMA (e.g., purchase of lottery tickets,
• Allows resident individuals, including minors, to remit money sweepstakes, proscribed magazines); Trading in foreign exchange
abroad each financial year (April – March). abroad; Remittances to countries identified as non-cooperative by
• Current limit: USD 250,000 per financial year. the FATF; Remittances to individuals/entities posing a terrorism risk
• Permissible Uses: Expenses related to travel (private or business); as identified by RBI.
Medical treatment abroad; Payment of fees for education abroad; Business Stan
Gifts and donations; Maintenance of close relatives; Investment in

4.2.2 RBI updates the Framework related to Regulatory Sandbox scheme

• R ecently, the RBI extended the timeline for completing various  BI introduced the first Regulatory Sandbox program in 2019 to
• R
stages of a Regulatory Sandbox (RS) from seven to nine months. test innovative financial products and services.
• The updated framework also mandates sandbox entities to  perates on a thematic cohort basis, focusing on areas like retail
• O
comply with provisions of the Digital Personal Data Protection Act, payments and MSME lending.
2023.  ohorts based on themes like financial inclusion and digital KYC.
• C
• RBI set up an inter-regulatory Working Group in 2016 to review  xclusion from RS: Certain activities like cryptocurrency are not
• E
the regulatory framework for FinTech. permitted.
• The group recommended introducing a Regulatory Sandbox  he government also introduced the “Millennium Spectrum
• T
(RS) to test new products or services in a controlled regulatory Regulatory Sandbox” initiative for telecom R&D activities.
environment. CD
• RS refers to live testing of new products or services in a
controlled regulatory environment with certain relaxations.
• It enables dynamic regulatory environments to learn and evolve
with emerging technologies.
• Target applicants include Fintechs, banks, and compa-
nies supporting financial services businesses are eligible for entry.

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4.2.3 Scale-Based Regulation of NBFCs
• R BI to review NBFC categorization in 2024 after introducing and top.
revised framework; Currently, 16 NBFCs placed in the upper layer. • N
 o NBFCs listed in the top layer.
• NBFCs are registered under Companies Act, 1956, engaged in • B
 ase Layer (NBFC-BL): Non-deposit-taking NBFCs with assets
various financial activities. below Rs 1,000 crore.
• NBFCs differ from banks in terms of regulations, deposit accep- • M
 iddle Layer (NBFC-ML): Includes deposit-taking NBFCs and non-
tance, and payment systems. deposit-taking NBFCs with assets exceeding Rs 1,000 crore.
• Categorized by type of liabilities and activities conducted. • U
 pper Layer (NBFC-UL): Comprises NBFCs requiring enhanced
• Categories include Asset Finance Company (AFC), Investment regulatory requirements based on specific parameters.
Company (IC), Loan Company (LC), Infrastructure Finance • T
 op Layer (NBFC-TL): Reserved for NBFCs posing significant sys-
Company (IFC), and Systemically Important NBFCs. temic risk. Currently vacant as a precautionary measure.
• Scale-Based Regulation (SBR) of NBFCs was implemented in The Hindu
October 2021 by RBI, comprising four layers: base, middle, upper,

4.2.4 Asset Reconstruction Companies (ARCs)

• R BI introduces updated guidelines for Asset Reconstruction • S
 ecurity Receipts: Issued to QIBs for raising funds to acquire
Companies (ARCs) effective from April 24, 2024. financial assets.
• ARC: Special financial institution acquiring debtors from banks for  ignificance: Banks can clean balance sheets, focus on core
• S
debt recovery. banking, and the NPA resolution mechanism.
• Registered under RBI, regulated under SARFAESI Act, 2002.  ecent guidelines: Minimum capital requirement increased to Rs
• R
• Objective: Take over bank’s NPAs, engage in asset reconstruction 300 crore from previous Rs 100 crore.
or securitization for debt recovery; Functions: Asset reconstruc- • T
 ransition period granted to existing ARCs to reach revised
tion, securitization. threshold by March 31, 2026.
• Foreign Investment: 100% FDI allowed under automatic route.  RCs must possess a minimum capital of Rs 200 crore by March
• A
• Limitations: Prohibited from lending, only engage in securitization 31, 2024.
and reconstruction. Business Stan
• Bank sells NPA to ARC at agreed value, recovery proceeds shared.

4.2.5 Curbs on Paytm Payments Banks

• R ecently, RBI has imposed additional curbs on Paytm Payments with other banks, and by promoting the initial contribution of at
Bank Ltd (PPBL), barring its mobile wallet operations post-Febru- least 40% for the first 5 years. (Rs 100 crore is the minimum paid-
ary. up equity capital).
• Section 35A of the Banking Regulation Act, of 1949, empowers • P
 rohibit lending operations or credit card issuance; priority sector
RBI to issue directives preventing banking entities from operating lending; and rural outreach requirements are conditional such
detrimentally to depositors’ interests. that 25% of access points must be at rural centers.
• Payment Banks such as Airtel Payments Bank, India Post Pay- • M
 ajor Activities performed by such banks include – accepting de-
ments Bank, etc, were introduced in 2014 by RBI Licensed under posits (up to Rs 2 lakh per account); Providing remittance services
Section 22 (1) (differentiated bank) of the Banking Regulation while facilitating money transfers; Issuing ATM/debit cards, and
Act, 1949 aimed for financial inclusion as recommended by Na- prepaid payment instruments; Offering internet banking services,
chiket Mor Committee. including fund transfers, bill payments.
• They maintain CRR and SLR by maintaining their 75% demand The Hindu
deposit balances in eligible G-securities/T-bills, 25% deposits

4.2.6 State ‘Guarantees’ on Borrowings

Background: The Reserve Bank of India (RBI) has issued guidelines • A void extending guarantees for external commercial borrowings
to regulate guarantees provided by State governments for and limit guarantees to a maximum of 80% of the project loan.
borrowings, aiming to enhance fiscal management and mitigate 3. R
 isk Assessment and Ceiling:
financial risks. • A ssign appropriate risk weights (high, medium, or low) to guar-
Key Recommendations: antees based on the entity’s past default history.
1. Definition of Guarantee: Expand the term ‘guarantee’ to encom- • Implement a ceiling on incremental guarantees issued during a
pass all instruments that create an obligation on the guarantor year, limiting them to 5% of Revenue Receipts or 0.5% of Gross
(State) to make a payment on behalf of the borrower at a future State Domestic Product (GSDP), whichever is lower, to manage
date, without distinguishing between conditional or unconditional, potential fiscal stress.
financial or performance guarantees. 4. G
 uarantee Fee Structure:
2. Restrictions on Government Guarantees: • Set a minimum guarantee fee of 2.5% per annum, reflective of
• Prohibit the use of government guarantees to obtain finance the borrower’s project riskiness and activities.
through State-owned entities that substitute budgetary 5. D
 isclosures and Monitoring:
resources of the State Government. • Advise banks and Non-Banking Financial Companies (NBFCs)
• Ensure guarantees do not create direct or de-facto liabilities on to disclose credit extended to State-owned entities backed by
the State. State-government guarantees.
• Adhere to guidelines stipulating that guarantees be given only • Establish a comprehensive database to track extended guar-
for the principal amount and normal interest component of the antees, enhancing transparency and fiscal oversight.
underlying loan. The Hindu

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4.3 Monetary Policy and Financial Instruments
4.3.1 CRR on Green Deposits
• W hat is CRR? deposits, offering interest to depositors while directing funds to-
Banks must hold a certain percentage of all their deposits (savings ward renewable energy, clean technology, and other green finance
accounts, current accounts, fixed deposits, etc.) with the RBI. It initiatives.
represents a percentage of a bank’s Net Demand and Time Liabili- • K
 ey Features of Green Deposits
ties (NDTL) that must be held with the RBI. Banks cannot use these • Eco-Friendly Financing: Funds raised are allocated to
funds for lending or earn interest on them. sustainable projects that may qualify under priority sector
• Who does CRR apply to? lending guidelines.
It applies exclusively to scheduled commercial banks, excluding • Overdraft Facility: Banks can offer overdrafts against green
non-banking financial companies (NBFCs) and rural banks. deposits.
• Understanding NDTL • C urrency and Insurance: Green deposits are available only in
NDTL includes balances from savings, current, and fixed deposit Indian Rupees and are insured by the Deposit Insurance and
accounts. Credit Guarantee Corporation (DICGC).
• What are Green Deposits? • R enewal and Withdrawal: Depositors can renew or withdraw
Green deposits are fixed-term investment products aimed at funds upon maturity.
financing eco-friendly projects. They function like regular fixed The Hindu

4.3.2 Central Bank Digital Currency (CBDC)

• R BI plans for a pilot program targeting the wholesale segment of • O nly scheduled banks act as Issuing and Paying Agent
Central Bank Digital Currency (CBDC) focusing on commercial • A ctively traded in Over-the-Counter (OTC) market, reported on
papers (CPs) and certificates of deposits (CDs). Fixed Income Money Market and Derivatives Association of India
• CBDC is digital legal tender issued by the central bank, akin to (FIMMDA) reporting platform
physical rupee notes or coins. • C ertificates of Deposits (CDs): Fixed-income financial instru-
• Announced in the Union Budget 2022-23, with subse- ment; Issuer: Scheduled Commercial Banks, All-India Financial
quent amendments to the RBI Act, 1934. Institutions
• Like fiat currency, it can be exchanged between people, serving • 3 months to 1 year (for SCBs), 1 to 3 years (for financial
as a digital counterpart to physical rupees. institutions)
• Unlike fiat currency, which relies on bank storage, CBDC is a liabili- • M inimum Investment: 1 lakh or multiples thereof
ty on the RBI’s balance sheet, accessible without a bank account. • T ypically issued by highly rated banks and financial institutions
• [A] Commercial Papers (CPs): Unsecured promissory note, issued • Purpose: Short to mid-term investment for individuals and
by Large corporations, primary dealers, financial institution; Matu- institutions
rity Period: 1 to 364 days • Typically fixed, higher than savings accounts, fluctuates with
• Minimum Investment: 5 lakh or multiples thereof. market conditions
• Purpose: Short-term funding for corporations. • Individuals, banking companies, other corporate bodies, NRIs,
• Interest Rate: Typically higher than bonds, fluctuates with market FIIs, etc.
conditions. • Can be issued in dematerialized form through SEBI-approved
• Investment Eligibility: Individuals, banking companies, corporate depositories
bodies (registered or incorporated in India), NRIs, FIIs, etc. Business Stan

4.3.3 Retail Direct Scheme

• R BI introduces Mobile App for RBI Retail Direct scheme, easing • G ilt Account functions akin to a bank account but deals with
government securities investment for retail investors. treasury bills or government securities instead of money.
• Retail Direct Scheme launched in November 2021, offering • It enables small investors to directly buy or sell government
individual investors access to maintain gilt accounts with RBI and securities without intermediaries.
invest in government securities. • M inimum bid amount is ₹10,000, payable via Net banking or UPI,
• Investors can purchase central and state government bonds, as with similar tax implications as other investments.
well as T-bills, through the app. • O ffers sovereign guarantee, ensuring zero risk of default.
• Allows participation in primary auctions and trading on the • P otential for higher interest rates compared to bank fixed
Negotiated Dealing System-Order Matching system (NDS-OM) deposits.
platform. CD

4.4 Digital Payments and FinTech Initiatives

4.4.1 DIGITA to check Illegal Lending Apps
• R BI plans to establish Digital India Trust Agency (DIGITA) to • C
 entral agency for vetting digital lending apps, ensuring
combat cyber fraud. authenticity and compliance.
• DIGITA aims to verify and maintain register of authenticated • A
 pps without DIGITA’s ‘verified’ signature deemed unauthorized,
digital lending enhancing law enforcement efforts.
• DIGITA aims to tackle proliferation of illegal lending apps by  erification processes promote transparency and accountability,
• V
verifying and maintaining a register of authenticated platforms. curbing fraudulent activities.

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• R
 BI shared a list of 442 digital lending apps with the IT  oogle removed over 2,200 digital lending apps from PlayStore,
• G
Ministry for whitelisting with Google. aligning with RBI and DFS directives. The Hindu

4.4.2 PRAVAAH Retail Direct mobile app

• R BI introduces three key initiatives: PRAVAAH portal, RBI Retail secondary markets.
Direct mobile app, FinTech Repository.  inTech Repository: Aims to provide comprehensive data on
• F
• Objectives: Streamline regulatory processes, empower retail Indian fintech firms.
investors, provide insights into the fintech sector. • F
 acilitates regulatory understanding, policy formulation in the
• PRAVAAH Portal: Centralized web-based platform for seeking fintech landscape.
RBI regulatory approvals. • E
 mTech Repository: Focuses on RBI-regulated entities’ adoption
• Features online application submission, status tracking, covers of emerging technologies.
60 application forms.  anaged by Reserve Bank Innovation Hub (RBIH), fostering
• M
• RBI Retail Direct Mobile App: Provides retail investors with access innovation, collaboration in the financial sector.
to government securities trading. The Indian Express
• Available on Android, iOS, simplifies transactions in primary,

4.4.3 Special Rupee Vostro Account (SRVA)

• India simplifies payment for importing pulses from Myanmar. • S
 RVA framework: invoicing, exchange rate, settlement in INR.
• Traders use Rupee/Kyat direct payment via SRVA through PNB. • D
 omestic importers pay INR into correspondent bank’s SRVA.
• Vostro Account: domestic banks hold foreign banks’ funds in • E
 xporters receive INR from the correspondent bank’s designated
rupees. account.
• Allows domestic banks to offer global banking services. • E
 ligibility: partner banks apply to domestic dealer banks, seek RBI
• Integral to correspondent banking, facilitating wire transfers, approval.
business transactions.  omestic banks ensure correspondent banks are not from FATF
• D
• Boosts domestic banks’ access to foreign markets, serves high-risk countries.
international clients. • A
 uthorised banks can open multiple SRVA per partner country.
• SRVA: INR settlement complements existing currency  alances repatriated in freely convertible or partner country
• B
settlement. currency, depending on transaction.
• Reduces reliance on freely convertible currencies. The Economic Times
• Requires RBI approval before opening, unlike Vostro account.

4.4.4 RBI joins Project Nexus

 roject Nexus, a multilateral initiative to enable instant
• P • A greement signed by BIS and central banks of founding countries
cross-border retail payments by interlinking domestic Fast Pay- in Basel, Switzerland.
ments Systems (FPSs). • Centralizes connections through a single platform.
• Conceptualized by the Innovation Hub of the Bank for Interna- • Allows a fast payment system to reach all other countries on the
tional Settlements (BIS). network within 60 seconds.
• Enhances cross-border payments by connecting global • The multilateral approach boosts RBI’s efforts to expand the
domestic instant payment systems (IPS). international reach of Indian payment systems.
• First BIS Innovation Hub project in the payments area to move • RBI collaborates bilaterally to link India’s FPS UPI with other
towards live implementation. countries’ FPSs for cross-border P2P and P2M payments (e.g.,
• Aims to connect the FPSs of four ASEAN nations: Malaysia, Phil- Bhutan, UAE, France, Sri Lanka, Mauritius).
ippines, Singapore, Thailand, and India as founding members. The Indian Express

4.5 International Financial Operations

4.5.1 RBI Repatriates Gold Reserves from UK
• T he RBI has repatriated over 100 tonnes of gold from the UK to its the United States.
domestic vaults.  uring the 1990-91 forex crisis, India pledged some gold reserves to
• D
• This marks the largest transfer since at least 1991. secure a loan, later deciding to retain it in the UK for convenience.
• Gold reserves refer to the gold held by a country’s central bank,  easons: Facilitates international trading, swaps, and returns;
• R
serving as a financial backup and store of value. Diversifies risks, particularly during geopolitical tensions.
• Countries like India store some of their gold reserves in foreign  old offers stable value over time compared to fiat currencies
• G
vaults to diversify risks and facilitate international trade. susceptible to economic factors.
• As of March 2024, the RBI holds 822.10 tonnes of gold, with 31 • R
 epatriating gold reduces storage costs and reflects confi-
tonnes stored domestically. dence in India’s economic stability.
• Gold comprises around 7-8% of India’s total FOREX reserves as • S
 aves on storage fees paid to foreign custodians.
of 2023. • R
 BI began buying gold in 2018, acquiring 200 tonnes during
• Storage Locations: Primarily at the Bank of England, known for the 2009 global financial crisis.
stringent security protocols; Bank for International Settlements  urchased 19 tonnes of gold in Q1 2024, exceeding the 16 tonnes
• P
(BIS) in Basel, Switzerland; Federal Reserve Bank of New York in bought throughout 2023. The Times Of India

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4.5.2 Surge in Indian Companies’ External Commercial Borrowings (ECBs)
• Indian companies’ ECB registrations nearly doubled to $49.2 Borrowings, FEMA.
billion in FY24 from $26.6 billion in FY23, as per RBI data. • C
 riteria: Includes minimum maturity, maximum cost ceiling, and
• ECBs are Funds borrowed by Indian firms from foreign sourc- permitted end-uses.
es like loans, bonds, or financial instruments. • R
 outes: (1) Approval route (sectors needing RBI/govt approval) vs.
• Purpose: Used for business expansion, asset acquisition, debt (2) Automatic route (meeting govt eligibility without approval).
repayment. • A
 ll entities except LLPs can raise ECBs under RBI guidelines.
• Sources: Obtained from foreign banks, international financial • B
 enefits: Large fund availability, long-term tenure, lower interest
institutions, Indian company foreign subsidiaries. rates compared to domestic funds, foreign currency access.
• Forms: (1) Rupee-denominated (repaid in INR) or (2) foreign cur- • R
 isks: Exchange rate fluctuations, sovereign credit risk, foreign
rency-denominated (repaid in foreign currency). lender credit risk, regulatory changes impacting borrowing.
• RBI oversees ECBs under Master Direction – External Commercial Business Stan

4.6 Reports and Publications

4.6.1 Report on Currency and Finance (RCF)
• R
 BI released the RCF for 2023-24, themed “India’s Digital Revo- • India’s working-age population will grow until 2048, potentially
lution.” pushing remittances to $160 billion by 2029.
• Annual publication on the Indian economy and financial system. • Mobile penetration in India is increasing, with internet access at
• Digital lending is growing, supported by the Open Credit Enable- 55% in 2023 and 199 million new users in the last three years.
ment Network and ONDC. • India has the lowest data costs globally, averaging 13.32 per GB.
• India was top recipient of global remittances in 2023, with $115.3 • India leads in mobile data usage with1 GB per user per month in
billion, making up 13.5% of the global total. 2023.
• Over 50% of India’s remittances in 2021 came from the Gulf, • RCF forecasts India will become the second-largest smartphone
with 22% from North America. manufacturer within 5 years.
• India’s remittance-to-GDP ratio increased from 8% in 2000 to CD
3.2% in 2023, higher than the 1.9% FDI-to-GDP ratio.

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5. BANKING AND FINANCIAL SECTOR
Prelims PYQs
[UPSC CSE 2010] In India, the interest rate on savings accounts in Select the correct answer using the code below:
all the nationalized commercial banks is fixed by (a) 1 only
(a) Union Ministry of Finance (b) 2 and 3 only
(b) Union Finance Commission (c) 1 and 3 only
(c) Indian Bank’s Association (d) 1, 2, and 3
(d) None of the above [UPSC CSE 2015] The Basel III Accord, often seen in the news, seeks
to:
[UPSC CSE 2010] With reference to the institution of Banking (a) D
 evelop national strategies for the conservation and sustainable
Ombudsman in India, which one of the statements is NOT correct? use of biological diversity
(a) The Banking Ombudsman is appointed by the Reserve Bank of (b) Improve the banking sector’s ability to deal with financial and
India economic stress and improve risk management
(b) The Banking Ombudsman can consider complaints from Non- (c) R
 educe greenhouse gas emissions but place a heavier burden on
Resident Indians having accounts in India developed countries
(c) The orders passed by the Banking Ombudsman are final and (d) T
 ransfer technology from developed countries to poor countries
binding on the parties concerned to enable them to replace the use of chlorofluorocarbons in
(d) The service provided by the Banking Ombudsman is free of any fee refrigeration with harmless chemicals

[UPSC CSE 2010] The National Investment Fund (NIF) was set up to [UPSC CSE 2013] Which of the following grants direct credit
manage disinvestment proceeds. Consider the following statements: assistance to rural households?
1. The assets in the National Investment Fund are managed by the 1. Regional Rural Banks
Union Ministry of Finance. 2 National Bank for Agriculture and Rural Development (NABARD)
2. The National Investment Fund is maintained within the 3. Land Development Banks
Consolidated Fund of India. Select the correct answer using the code given below:
3. C ertain Asset Management companies are appointed as the fund (a) 1 and 2 only
managers. (b) 2 only
4. A certain proportion of annual income is used for financing select (c) 1 and 3 only
social sectors. (d) 1, 2, and 3
Which of the statements given above is/are correct?
(a) 1 only [UPSC CSE 2017] What is the purpose of setting up Small Finance
(b) 2 only Banks (SFBs) in India?
(c) 3 and 4 only 1. To supply credit to small business units
(d) 3 only 2. T o supply credit to small and marginal farmers
3. To encourage young entrepreneurs to set up businesses,
[UPSC CSE 2013] Debenture holders of a company are its: particularly in rural areas
(a) Shareholders Select the correct answer using the code given below:
(b) Creditors (a) 1 and 2 only
(c) Debtors (b) 2 and 3 only
(d) Directors (c) 1 and 3 only
(d) 1, 2, and 3
[UPSC CSE 2015] Consider the following pairs:
1. ABN Amro Bank – USA [UPSC CSE 2021] Consider the following statements regarding
2. Barclays Bank – UK Urban Cooperative Banks in India:
3. Kookmin Bank – Japan 1. They are supervised and regulated by local boards set up by the
Which of the above pairs is/are correctly matched? State Governments.
(a) 1 only 2. T hey can issue equity shares and preference shares.
(b) 2 only 3. They were brought under the purview of the Banking Regulation
(c) 1 and 2 Act, 1949 through an amendment in 1966.
(d) 1 and 3 Which of the statements given above is/are correct?
(a) 1 only
[UPSC CSE 2016] The term “Core Banking Solution” is sometimes (b) 2 and 3 only
seen in the news. Which of the following statements best describes (c) 1 and 3 only
this term? (d) 1, 2, and 3
1. It is a networking of a bank’s branches that enables customers to
operate their accounts from any branch of the bank on its network
regardless of where they opened their accounts.
2. It is an effort to increase RBI’s control over commercial banks
through computerization.
3. It is a detailed procedure by which a bank with huge non-
performing assets is taken over by another bank.

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[UPSC CSE 2018] With reference to the governance of Public Sector [UPSC CSE 2022] With reference to the Banks Board Bureau (BBB),
Banks in India, consider the following statements: which of the following statements are correct?
1. Capital infusion into public sector banks by the Government of India 1. The Governor of RBI is the Chairman of BBB.
has steadily increased in the last decade. 2. BBB recommends the selection of heads for Public Sector Banks.
2. To put the public sector banks in order, the merger of associate 3. BBB helps Public Sector Banks in developing strategies and capital-
banks with the parent State Bank of India has been effected. raising plans.
Which of the statements given above is/are correct? Select the correct answer using the code given below:
(a) 1 only (a) 1 and 2 only
(b) 2 only (b) 2 and 3 only
(c) Both 1 and 2 (c) 1 and 3 only
(d) Neither 1 nor 2 (d) 1, 2, and 3

[UPSC CSE 2018] The term Merchant Discount Rate, sometimes [UPSC CSE 2024] Consider the following statements regarding
seen in the news, refers to: Syndicated Lending:
(a) The incentive given by a bank to a merchant for accepting 1. Syndicated lending spreads the risk of borrower default across
payments through debit cards multiple lenders.
(b) T he amount paid back by banks to their customers when they use 2. The syndicated loan can be a fixed amount/lump sum of funds, but
debit cards for financial transactions cannot be a credit line.
(c) The charge to a merchant by a bank for accepting payments from Which one of the following is correct in respect of the above
his customers through the bank’s debit cards statements?
(d) T he incentive given by the Government to merchants for promoting (a) Both Statement-I and Statement-II are correct, and Statement-II
digital payments explains Statement-I
(b) Both Statement-I and Statement-II are correct, but Statement-II
[UPSC CSE 2019] The Inter-Creditor Agreement, signed by Indian does not explain Statement-I
banks and financial institutions recently, aims at: (c) S tatement-I is correct, but Statement-II is incorrect
(a) Lessening the Government of India’s burden of fiscal deficit and (d) Statement-I is incorrect, but Statement-II is correct
current account deficit
(b) S upporting infrastructure projects of Central and State
Governments
(c) Acting as an independent regulator in case of applications for
loans of ₹50 crore or more
(d) F  aster resolution of stressed assets under consortium lending

5.1 NPA Crisis

5.1.1 Asset Reconstruction Companies (ARCs)
• R BI introduces updated guidelines for Asset Reconstruction • S
 ecurity Receipts: Issued to QIBs for raising funds to acquire
Companies (ARCs) effective from April 24, 2024. financial assets.
• ARC: Special financial institution acquiring debtors from banks for  ignificance: Banks can clean balance sheets, focus on core
• S
debt recovery. banking, and the NPA resolution mechanism.
• Registered under RBI, regulated under SARFAESI Act, 2002.  ecent guidelines: Minimum capital requirement increased to Rs
• R
• Objective: Take over bank’s NPAs, engage in asset reconstruction 300 crore from previous Rs 100 crore.
or securitization for debt recovery; Functions: Asset reconstruc- • T
 ransition period granted to existing ARCs to reach revised
tion, securitization. threshold by March 31, 2026.
• Foreign Investment: 100% FDI allowed under automatic route.  RCs must possess a minimum capital of Rs 200 crore by March
• A
• Limitations: Prohibited from lending, only engage in securitization 31, 2024.
and reconstruction. Business Stan
• Bank sells NPA to ARC at agreed value, recovery proceeds shared.

5.2 Insolvency and Bankruptcy Code

5.2.1 Insolvency and Bankruptcy Board of India (IBBI)
• IBBI proposes amendments to enhance efficiency, reduce costs, • S ets eligibility criteria and curriculum for insolvency professionals.
and increase transparency in the Insolvency Resolution Process • C ollects and maintains records on insolvency cases and
for Corporate Process regulations. disseminates related information.
• IBBI was established on 1st October 2016 under the Insolvency • T otal 10 members including Chairperson appointed by the Cen-
and Bankruptcy Code (IBC), 2016. tre.
• Objective: To promote a creditor-driven insolvency resolution • Adjudicating Authorities: National Company Law Tribunal (NCLT)
process, enhancing India’s credit culture and business environment. for corporate entities and Debt Recovery Tribunal (DRT) for individ-
• Implements and enforces the IBC for individuals, partnership uals and partnership firms (excluding LLPs).
firms, and corporate entities. • R ecent Amendments to IBC
• Regulates insolvency professionals, entities, and information • A pproval for segregated sale of assets or resolution plans.
utilities. • I ncrease in NCLT benches to 16 for faster adjudication.
• Enforces rules for corporate and individual insolven- • E xtension of timelines for filing claims to accommodate
cy resolution, liquidation, and bankruptcy. procedural complexities. The Hindu

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5.3 Banking Sector Reforms
5.3.1 National Urban Cooperative Finance and Development Corporation Limited (NUCFDC):
• U nion Home Minister and Minister of Cooperation inaugurated ance, and strategic planning.
NUCFDC, marking a significant milestone in urban cooperative  bout Urban Cooperative Banks (UCBs): Governed by RBI under
• A
banking development. the Banking Regulation Act of 1949, adhering to strict prudential
• About NUCFDC: Approved by RBI as a Non-Banking Finance norms.
Company (NBFC) and designated as the apex body for urban • U
 rban and rural UCBs based on geographic scope, regulated
cooperative banking. by State Registrars of Cooperative Societies (RCS) or Central
• It is granted Self-Regulatory Organisation (SRO) status to Registrar of Cooperative Societies (CRCS) and the RBI.
oversee and regulate urban cooperative banking operations.  volved since the first Cooperative Credit Society in 1904, un-
• E
• Aims to raise capital to Rs. 300 crores to strengthen Urban dergoing regulatory reforms.
Cooperative Banks (UCBs). • N
 arasimham Committee Report (1998): Proposed regulatory
• Deploy capital to enhance UCBs’ financial capabilities, including interventions to enhance governance, capitalization, and efficiency.
shared technology infrastructure for improved service delivery and • S
 tructural Recommendations Committee (2021): Proposed
reduced costs. a 4-tier structure for UCBs based on deposit size tiers to streamline
• Establish collaborative technology platforms for UCBs to expand operations and regulatory oversight.
services efficiently. The Hindu
• Provide consultancy on fund management, regulatory compli-

5.3.2 Basel III Endgame

 S Federal Reserve announces stricter bank capital require-
• U ments.
ments, dubbed “Basel III endgame” proposal. • “ Endgame” proposal refines capital setting based on bank activity
• The committee lacks legal authority to impose agreed standards; riskiness.
adoption is the responsibility of 26 countries plus the EU and Hong • P roposal focuses on credit risk, market risk, and operational risk
Kong. • R ules apply to banks with over $100 billion in assets, affecting
• Basel Committee on Banking Supervision (BCBS) aims for global lending and trading.
minimum capital standards post-2007-09 financial crisis. • B anks oppose additional capital, citing pandemic resilience and
• BCBS was established in 1974 to enhance financial stability via stress test clearance.
improved bank supervision; India joined BCBS in 2009. • U S regulators expected to revise the proposal following industry
• Panel convened by Bank for International Settlements (BIS) in criticism, potentially delaying implementation.
Basel, Switzerland. • R BI introduced norms on Basel III capital framework, fund raising,
• Primary global standard-setter for prudential regulation of banks, and exposure guidelines for All India Financial Institutions (AI-
aiming for uniform minimum capital standards. FIs), effective April 2024.
• Basel III standards include capital, leverage, and liquidity require- The Hindu

5.3.3 Domestic Systemically Important Banks (D-SIBs)

• R BI retains SBI, HDFC Bank, and ICICI Bank as D-SIBs. • I CICI Bank: Bucket 1 (lowest risk)
• SBI was designated in 2015, ICICI Bank: 2016, HDFC Bank: 2017. • C apital Requirements: SBI: 80% CET1; HDFC Bank: 0.40% CET1;
• Deemed ‘Too Big to Fail’ due to size, complexity, and ICICI Bank: 0.20% CET1
interconnectedness in the economy. • Selection Process:
• Subjected to additional regulations like capital buffers, stress • S ample Selection: Banks with assets over 2% of GDP are
tests, and recovery planning to ensure financial stability. assessed.
• Bucketing: D-SIBs classified into 4 buckets based on systemic • S ystemic Importance: Evaluated through indicators like lack
importance. of substitutability, interconnectedness, and composite score.
• SBI: Bucket 4 (highest risk) The Hindu
• HDFC Bank: Bucket 3

5.3.4 India Post Payments Bank (IPPB)

• L
 aunched: 2018 as a division of India Post under the Ministry of nies Act, 2013, and licensed under the Banking Regulation
Communications. Act, 1949.
• Operates as a payments bank. • G overned by Banking Regulation Act, RBI Act, 1934,
• Offers savings and current accounts, money transfers, bill pay- and FEMA, 1999.
ments, and insurance. • M inimum Paid-up Capital: ₹100 crore.
• Implements Aadhaar-enabled Payment System (AePS) for se- • C an accept deposits up to ₹2,00,000 in savings and cur-
cure transactions. rent accounts.
• Services provided by 3 lakh postmen and Grameen Dak Sewaks. • I nvestment: 75% of deposits in government securities
• 4 crore customers by Dec 2020, 8 crore by Jan 2022, 9 (SLR), 25% in time deposits with commercial banks.
crore by Mar 2024. CD
• Payments Bank:
• Operates like a regular bank but without credit risk.
• Registered as a public limited company under the Compa-

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5.4 Microfinance Story of India
5.4.1 MUDRA 2.0 Loans
• T he Union Budget raised the loan limit under the Tarun category  oan categories: Shishu: Up to ₹50,000 for new micro enterpris-
• L
to ₹20 lakh for those who repaid previous MUDRA loans. es; Kishore: ₹50,000 to ₹5 lakh for growing businesses; Tarun: ₹5
• Mudra 1.0 scheme (2015) provided affordable credit to micro lakh to ₹10 lakh for business expansion.
and small enterprises. • N
 o direct subsidy, but loans linked to government schemes can
• “Fund the unfunded” by offering loans via PSBs, RRBs, Coopera- have associated benefits.
tive Banks, MFIs, NBFCs, etc. • O
 ver ₹27.75 lakh crore disbursed to 47 crore entrepreneurs,
• Loan amount: Up to ₹10 lakh for non-farm income-generating activ- boosting the grassroots economy.
ities like manufacturing, trading, and services. • 6
 9% loan accounts held by women; 51% by SC/ST/OBC entrepre-
• Any Indian citizen with a viable business plan needing credit neurs.
below ₹10 lakh. The Indian Express

5.4.2 Pradhan Mantri Mudra Yojana (PMMY)

• C entre increased Mudra loan limit under PMMY from ₹10 lakh to • T
 arun Plus: Loans between ₹10 lakh and ₹20 lakh (introduced
₹20 lakh in a new ‘Tarun Plus’ category. in July 2024).
• The higher limit applies to entrepreneurs who previously took • A
 chievements:
and repaid loans under the ‘Tarun’ category. • 8
 million Loans sanctioned, totaling ₹5.4 trillion.
• Launched on April 8, 2015, by the PM to support non-corporate, • O
 ver 487.8 million loans worth ₹29.79 trillion sanctioned
non-farm small and micro-entrepreneurs with collateral-free since 2015.
loans. • N
 PA for public sector banks under Mudra loans reduced to
• Targets small businesses outside the corporate and agricultural 3.4% in FY24, down from 4.77% in 2020-21.
sectors, such as self-employed workers, small shops, artisans, and • G
 ross NPA for scheduled commercial banks at 2.8% as of
repair services. March 2024.
• Loan categories: • E
 mpowers women, minorities, and marginalized communities by
• Shishu: Loans up to ₹50,000 improving access to credit.
• Kishore: Loans between ₹50,000 and ₹5 lakh CD
• Tarun: Loans between ₹5 lakh and ₹10 lakh

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6. CAPITAL MARKETS
Prelims PYQs
[UPSC CSE 2003] With reference to the Indian economy, consider [UPSC CSE 2016] With reference to ‘IFC Masala Bonds’, sometimes
the following statements: seen in the news, which of the statements given below is/are correct?
1. The maximum limit of shareholding of Indian promoters in private 1. T
 he International Finance Corporation, which offers these bonds, is
sector banks in India is 49 percent of the paid-up capital. an arm of the World Bank.
2. Foreign Direct Investment up to 49 percent from all sources is 2. T hey are the rupee-denominated bonds and are a source of debt
permitted in private sector banks in India under the automatic financing for the public and private sector.
route. Select the correct answer using the code given below.
Which of these statements is/are correct? (a) 1 only
(a) 1 only (b) 2 only
(b) 2 only (c) Both 1 and 2
(c) Both 1 and 2 (d) Neither 1 nor 2
(d) Neither 1 nor 2
[UPSC CSE 2016] What is/are the purpose/purposes of
[UPSC CSE 2003] With reference to India, which one of the following Government’s ‘Sovereign Gold Bond Scheme’ and ‘Gold Monetization
statements is NOT correct? Scheme’?
(a) IPCL is India’s largest petrochemical company 1. T
 o bring the idle gold lying with Indian households into the economy.
(b) RIL is the largest private sector company in India 2. T o promote FDI in the gold and jewelry sector
(c) MTNL is listed on NYSE 3. To reduce India’s dependence on gold imports
(d) BSNL is the first telecom service organization in India to launch a Select the correct answer using the code given below.
nationwide cellular service at one time (a) 1 only
(b) 2 and 3 only
[UPSC CSE 2005] Consider the following pairs: (c) 1 and 3 only
1. ADR (American Depository Receipt) (d) 1, 2, and 3
2. GDR (Global Depository Receipt)
3. S DR (Special Drawing Rights) [UPSC CSE 2021] Indian Government Bond Yields are influenced by
Which of the above is/are treated as artificial currency? which of the following?
(a) 1 only 1. A
 ctions of the United States Federal Reserve
(b) 1 and 3 only 2. A ctions of the Reserve Bank of India
(c) 3 only 3. Inflation and short-term interest rates
(d) 2 and 3 only Select the correct answer using the code given below:
(a) 1 and 2 only
[UPSC CSE 2010] Consider the following statements: (b) 2 only
1. A share of the household financial savings goes towards (c) 3 only
government borrowings. (d) 1, 2, and 3
2. Dated securities issued at market-related rates in auctions form a
large component of internal debt. [UPSC CSE 2023] Consider the following markets:
Which of the above statements is/are correct? 1. Government Bond Market
(a) 1 only 2. Call Money Market
(b) 2 only 3. Treasury Bill Market
(c) Both 1 and 2 4. Stock Market
(d) Neither 1 nor 2 How many of the above are included in capital markets?
(a) Only one
[UPSC CSE 2011] With reference to the Indian economy, what does (b) Only two
the term “deficit financing” refer to? (c) Only three
(a) Financing by the Central Government to cover the deficit in the (d) All four
current account of the balance of payments.
(b) Financing by the Central Government to cover the fiscal deficit [UPSC CSE 2023] In the context of finance, the term ‘beta’ refers to:
by borrowing from the market. (a) T he process of simultaneous buying and selling of an asset from
(c) Financing by the State Governments to cover their revenue deficit. different platforms
(d) Financing by private corporations to cover their financial losses. (b) A n investment strategy of a portfolio manager to balance risk
versus reward
[UPSC CSE 2012] Consider the following pairs: (c) A type of systemic risk that arises where perfect hedging is not
1. ABN Amro Bank : USA possible
2. Barclays Bank : UK (d) A numeric value that measures the fluctuations of a stock to
3. Kookmin Bank : Japan changes in the overall stock market
Which of the above pairs is/are correctly matched?
(a) 1 only
(b) 2 only
(c) 1 and 2
(d) 1 and 3

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6.1 ‘Hot Money’ Inflows
• I ndia’s inclusion in JPMorgan’s emerging market debt index is • I nvestors quickly withdraw and move funds based on interest rate
significant for its financial markets. changes.
• Brings risk of ‘hot money’ inflow, affecting currency and bond • E conomic hazards posed include- Volatility risks market
markets. stability; Currency depreciation harms exports; Interest rate volatil-
• Funds seeking short-term returns, flowing between countries for ity complicates central bank policy; Financial instability due to herd
profit. behavior.
• High-interest, short-term options like Certificate of Deposits. • R BI regulates interest rates to discourage speculative
• Foreign portfolio investment (FPI) known as ‘hot money’ due to investments.
its short-term nature. • M aintaining financial stability through proactive measures.
• Banks offer high-interest CDs to attract funds. The Hindu

6.2 T + 0 Settlement
• India’s stock market will begin a ‘beta version’ of the T+0 settle- especially for UPI clients, strengthens investor protection.
ment system (same day settlement) from today, the world›s fastest • S EBI shortened the settlement cycle from T+5 to T+3 in 2002,
stock settlement system. then to T+2 in 2003.
• SEBI plans to introduce a shorter cycle in two phases: Phase • T +1 cycle introduced in 2021, fully implemented by January 2023,
1 settles trades executed until 1:30 PM by 4:30 PM on the same settling funds and securities day after trade.
day. Phase 2 envisions immediate trade-by-trade settlement, • Initially, T+0 settlement was available for top 500 listed equity
trading till 3:30 PM. shares in three tranches based on market capitalization.
• Many retail investors already make early pay-ins, indicating readi- • S urveillance measures applicable in the T+1 cycle will apply to the
ness for instant settlement. T+0 cycle.
• Mechanism enables instant receipt of funds and securities, • T rade-for-trade settlement securities NOT eligible for T+0.
reducing settlement shortages, enhancing investor control. Live Mint
• Direct crediting of funds and securities into investors’ accounts,

6.3 SCORES 2.0 to Strengthen Investor Redressal

 EBI unveils upgraded version of SEBI Complaint Redress System
• S • I ntegration with KYC Database: Streamlined registration process
(SCORES 2.0), enhancing investor complaint redressal mecha- for investors.
nism. • A uto-routing, auto-escalation, and stricter monitoring protocols.
• SCORES 2.0: Upgrade to an online platform facilitating complaint • A bout SEBI: Regulatory authority for India’s securities and
lodging and resolution in the securities market. commodity markets.
• Covers issues under: SEBI Act 1992, Securities Contract Regula- • E stablished in 1988, gained statutory powers with SEBI Act 1992.
tion Act 1956, Depositories Act 1966, and Companies Act 2013. • It operates under the Ministry of Finance, with chairman and mem-
• Complaints can be launched against listed companies, brokers, bers nominated by GoI.
depository participants, mutual funds, and others. • H eadquarters in Mumbai, with regional offices in Ahmedabad,
• Maximum redressal period of 21 days from complaint receipt. Kolkata, Chennai, and Delhi.
• Complaints directed to relevant entities, two-tier review process. The Hindu

6.4 Mutual Funds

 EBI approves amendments to enhance the regulatory frame-
• S manages portfolio based on professional judgement and research.
work for Asset Management Companies (AMCs). • ( 2) Passively managed funds: Fund manager tracks market index
• Mutual Funds: Pools of money managed by professional Fund without active decision-making.
Managers. • T hree-tier structure: Comprising Asset Management Company
• Collect funds from investors with a common objective, invest in (AMC), Trustees, and Custodians.
securities, and distribute income/gains proportionately. • A MC manages investments; Trustees oversee operations; Custo-
• Regulated by SEBI through SEBI (Mutual Funds) Regulations, dians safeguard assets.
1996. The Hindu
• Types: (1) Actively managed funds: Fund manager actively

6.5 Equity Linked Savings Schemes (ELSS)

• E LSS has seen a decline in popularity, with more money being tax-exempt.
withdrawn than invested. • T ax benefits under 80C reduce the tax burden.
• They are mutual fund schemes offering tax benefits under Sec- • E LSS is the only mutual fund type eligible for tax deductions
tion 80C of the Income Tax Act. under Section 80C.
• Section 80C permits certain investments and expenses to be • Investors can claim a tax rebate of up to Rs 1,50,000 and save up

Flash Notes: ECONOMY HQ: Ground Floor, Apsara Arcade, ORN, New Delhi-05 80765 17832 26
 to Rs 46,800 annually by investing in ELSS. • T he new tax regime introduced in 2020-21 is now the default
• E LSS mutual funds allocate mostly (65% of the portfolio) to- option.
wards equity and equity-linked securities. • The old tax regime offered various exemptions and deductions,
• ELSS funds have a 3-year lock-in period, the shortest among reducing income tax.
Section 80C investments. • These benefits are not available under the new tax regime, mak-
• They are market-linked and subject to risk but may offer higher ing ELSS less attractive to investors.
returns compared to traditional tax-saving instruments like NSC or The Hindu
PPF.

6.6 Sovereign Gold Bond (SGB) Scheme

• G ovt. might reduce or discontinue the SGB scheme due to its • M
 inimum investment is 1 gram.
high cost. • M
 aximum limit: 4 kg for individuals, 4 kg for HUFs, and 20 kg for
• SGBs are government securities denominated in grams of gold. trusts and similar entities per fiscal year.
• Launched by the Government of India on October 30, 2015. • T
 enure is 8 years, with exit options in the 5th, 6th, and 7th years,
• Substitutes for holding physical gold; investors pay the issue exercisable on interest payment dates.
price and redeem the bonds upon maturity. • S
 old through: Nationalised Banks, Scheduled Private Banks,
• Issued by RBI on behalf of the Government of India. Scheduled Foreign Banks, designated Post Offices, Stock Holding
• Eligibility: Restricted to resident Indian entities, including Corporation of India Ltd. (SHCIL), and authorized stock exchanges
individuals (individually, on behalf of minor child, or jointly), Hindu or their agents.
Undivided Family (HUF), Trusts, Universities, and Charitable • P
 ayment for the bonds is through cash payment.
Institutions. CD
• Issued in denominations of 1 gram of gold and multiples thereof.

6.7 Future and Options (F&O)

• S EBI introduced a six-step framework to protect investors and • F
 utures are high-risk, with potential for unlimited profit or loss.
limit speculative trading in futures and options (F&O). • O
 ptions: An option gives the right, not the obligation, to buy or
• Futures: An agreement to buy or sell an asset at a specified sell an asset at a set price on a future date.
future price and time. • O
 ptions carry limited risk but can yield unlimited profit or loss.
• Buyer must buy, and seller must sell at the agreed price, regard- • P
 remiums are paid upfront as part of option contracts.
less of market value at expiration. • H
 edging is a risk management strategy to buy or sell
• Underlying assets include commodities and financial instru- investments, reducing loss risks on existing positions.
ments like stocks, currencies, and bonds. The Economic Times

6.8 Passive Mutual Funds

• S
 EBI launched the liberalized Mutual Funds Lite (MF Lite) frame- manages portfolio based on professional judgement and research.
work specifically for passively managed schemes. • ( 2) Passively managed funds: Fund manager tracks market index
• Mutual Funds: Pools of money managed by professional Fund without active decision-making.
Managers. • T hree-tier structure: Comprising Asset Management Company
• Collect funds from investors with a common objective, invest in (AMC), Trustees, and Custodians.
securities, and distribute income/gains proportionately. • A MC manages investments; Trustees oversee operations; Custo-
• Regulated by SEBI through SEBI (Mutual Funds) Regulations, dians safeguard assets.
1996. The Hindu
• Types: (1) Actively managed funds: Fund manager actively

6.9 Climate Finance Taxonomy

• 2 024 Union Budget, includes developing a taxonomy for cli- • P
 ublic investments alone can’t meet this goal, necessitating
mate finance to enhance capital availability for climate adaptation standardized investments.
and mitigation. • C
 FT attracts more climate funds from international sources.
• It is a classification system identifying economic activities as • C
 urrent green finance flows in India fall short, around 3% of total
sustainable investments. FDI inflows (Landscape of Green Finance in India 2022 report).
• Guides investors and financial institutions to direct capital to-  taxonomy clarifies sustainable activities, addressing the low
• A
wards climate adaptation and mitigation projects. green finance flows issue.
• Essential for transitioning to a net-zero economy amidst rising The Hindu
global temperatures.
• Provides clear criteria for sustainable investments, reduces green-
washing
• India needs an estimated $10.1 trillion to achieve net-zero by
2070 (IFC estimate).

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7. TRADE
Prelims PYQs
[UPSC CSE 2003] India’s import of crude and petroleum products [UPSC CSE 2017] ‘Broad-based Trade and Investment Agreement
during the year 2001-02 accounted for about 27% of India’s total (BTIA)’ is sometimes seen in the news in the context of negotiations
imports. held between India and:
(a) Only 1 (a) European Union
(b) Only 2 (b) Gulf Cooperation Council
(c) Both 1 and 2 (c) Organization for Economic Cooperation and Development
(d) Neither 1 nor 2 (d) Shanghai Cooperation Organization

[UPSC CSE 2003] With reference to the Indian economy, consider [UPSC CSE 2020] With reference to Trade-Related Investment
the following statements: Measures (TRIMS), which of the following statements is/are correct?
1. The maximum limit of shareholding of Indian promoters in private 1. Q
 uantitative restrictions on imports by foreign investors are
sector banks in India is 49 percent of the paid-up capital. prohibited.
2. Foreign Direct Investment up to 49 percent from all sources is 2. T hey apply to investment measures related to trade in both goods
permitted in private sector banks in India under the automatic and services.
route. 3. They are not concerned with the regulation of foreign investment.
Which of these statements is/are correct? Select the correct answer using the code given below:
(a) 1 only (a) 1 and 2 only
(b) 2 only (b) 2 only
(c) Both 1 and 2 (c) 1 and 3 only
(d) Neither 1 nor 2 (d) 1, 2 and 3

[UPSC CSE 2003] With reference to India, which one of the following [UPSC CSE 2020] With reference to the international trade of India
statements is NOT correct? at present, which of the following statements is/are correct?
(a) I PCL is India’s largest petrochemical company 1. India’s merchandise exports are less than its merchandise imports.
(b) RIL is the largest private sector company in India 2. India’s imports of iron and steel, chemicals, fertilizers, and
(c) MTNL is listed on NYSE machinery have decreased in recent years.
(d) BSNL is the first telecom service organization in India to launch a 3. India’s exports of services are more than its imports of services.
nationwide cellular service at one time 4. India suffers from an overall trade/current account deficit.
Which of the statements given above is/are correct?
[UPSC CSE 2005] Consider the following pairs: (a) 1 and 2 only
1. ADR (American Depository Receipt) (b) 2 and 4 only
2. GDR (Global Depository Receipt) (c) 3 only
3. S DR (Special Drawing Rights) (d) 1, 3 and 4
Which of the above is/are treated as artificial currency?
(a) 1 only [UPSC CSE 2023] Consider the following statements:
(b) 1 and 3 only Statement-I: Switzerland is one of the leading exporters of gold in
(c) 3 only terms of value.
(d) 2 and 3 only Statement-II: Switzerland has the second largest gold reserves in the
world.
[UPSC CSE 2010] Consider the following statements: Which one of the following is correct in respect of the above
1. A share of the household financial savings goes towards statements?
government borrowings. (a) B
 oth Statement-I and Statement-II are correct and Statement-II is
2. Dated securities issued at market-related rates in auctions form a the correct explanation for Statement-I
large component of internal debt. (b) B
 oth Statement-I and Statement-II are correct and Statement-II is
Which of the above statements is/are correct? not the correct explanation for Statement-I
(a) 1 only (c) S
 tatement-I is correct but Statement-II is incorrect
(b) 2 only (d) S
 tatement-I is incorrect but Statement-II is correct
(c) Both 1 and 2
(d) Neither 1 nor 2

[UPSC CSE 2011] With reference to the Indian economy, what does
the term “deficit financing” refer to?
(a) Financing by the Central Government to cover the deficit in the
current account of the balance of payments.
(b) Financing by the Central Government to cover the fiscal deficit
by borrowing from the market.
(c) Financing by the State Governments to cover their revenue deficit.
(d) Financing by private corporations to cover their financial losses.

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7.1 Trade Sector Updates – Falling Exports, TIES, MEIS, Foreign Trade Policy, etc.
7.1.1 European Free Trade Association (EFTA) Bloc
• I ndia rejects demand for ‘data exclusivity’ provision in proposed • U nlike the EU, EFTA is not a customs union.
free trade agreements. • A llows individual EFTA States to set their own customs tar-
• Cites commitment to protecting interests of the domestic iffs and trade measures with non-EFTA States.
generic drugs industry. • European Economic Area (EEA) includes EU Member States + 3
• European Free Trade Association (EFTA) established in EFTA countries (Iceland, Liechtenstein, Norway, excluding Switzer-
1960 by Stockholm Convention. land).
• Promotes free trade & economic integration within Europe & globally. • Agreement entered into force on 1 January 1994.
• 4 members include- Iceland, Liechtenstein, Norway, & Switzerland. • Aims to strengthen trade and economic relations, focusing on
• EFTA countries have an extensive network of FTAs covering over free movement of goods, people, services, and capital.
60 countries, including the EU. The Hindu

7.1.2 India signs Trade Pact with EFTA

• India has inked a momentous Free Trade Agreement (FTA) with • U nlike the EU, EFTA is not a customs union.
the European Free Trade Association (EFTA), comprising Iceland, • A llows individual EFTA States to set their own customs tar-
Liechtenstein, Norway, and Switzerland. iffs and trade measures with non-EFTA States.
• European Free Trade Association (EFTA) established in • European Economic Area (EEA) includes EU Member States + 3
1960 by Stockholm Convention. EFTA countries (Iceland, Liechtenstein, Norway, excluding Switzer-
• Promotes free trade and economic integration within Europe and land).
globally. • Agreement entered into force on 1 January 1994.
• 4 members include- Iceland, Liechtenstein, Norway, & Switzerland. • Aims to strengthen trade and economic relations, focusing on
• EFTA countries have an extensive network of FTAs covering over free movement of goods, people, services, and capital.
60 countries, including the EU. The Hindu

7.1.3 UNCTAD Global Trade Report, 2024

• U NCTAD Global Trade Report highlights India’s evolving trade pandemic and Russia-Ukraine conflict, leading to record-high food
landscape with increased reliance on China and the European and fuel prices.
Union (EU). • S
 table geographical proximity of international trade, with a rise
• UNCTAD, established in 1964, is a permanent intergovernmental in political proximity favouring countries with similar geopolitical
body under the UN. stances.
• Supports developing countries in accessing the benefits of • G
 lobal merchandise trade is expected to contract by 5% in
globalization. 2023, while services trade is projected to gain 8%.
• Key reports: Trade and Development, World Investment, • R
 ussia-Ukraine Conflict led to a surge in Russia’s trade depen-
Technology and Innovation, and Digital Economy. dence on China by 7.1%, decreasing reliance on the EU by 5.3%.
• Membership includes all 195 UN member states, with India ac- • R
 ussian oil shifted from the EU to China and India, with China
tively participating since 1968. becoming a significant trade partner.
• India’s trade dependence on China and the EU increased by • T
 he US reduced reliance on China by 1.2% in 2023, increasing
1.2%, while reliance on Saudi Arabia declined by 0.6%. dependence on the EU and Mexico.
• Shift attributed to supply chain disruptions caused by the The Indian Express

7.1.4 Anti-Dumping Duty

• D GTR recommends anti-dumping duty on sodium cyanide from Finance.
China, EU, Japan, and Korea. • C overed under Customs Tariff Act, 1975, and Customs Tariff Rules,
• Sodium Cyanide is a deadly toxic compound, NaCN, used in gold 1995.
mining, electroplating, and organic synthesis. • D GAD conducts investigations to assess impact on domestic
• Water-soluble, hygroscopic, vital in gold extraction and industrial industry.
processes. • A DD is calculated as the difference between normal value and
• Anti-Dumping Duty is protectionist tariff against foreign im- export value.
ports priced below exporters’ domestic market. • N ormal value: market value in the domestic market.
• Aims to protect local businesses and economy; Governed by • E xport value: price at which product exported to India.
WTO rules. • I mposed to offset price difference and protect domestic industry.
• Anti-Dumping is administered by DGAD under the Ministry of The Hindu

7.1.5 Netherlands becomes India’s 3rd Largest Export Destination in 2023-24

• T he Netherlands has become India’s 3rd largest export destina- • E xports to the Netherlands grew by approximately 3.5%, reach-
tion globally in 2023-24, following the US and UAE. ing USD 22.36 billion in 2023-24, up from USD 21.61 billion in
• It ranks among India’s key trading partners in Europe, after Ger- 2022-23.
many, Switzerland, the UK, and Belgium. • It constituted 36% of India’s total trade in 2022-23.

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• S ignificant investor in India, with about USD 5 billion in FDI re-  apital: Amsterdam (official), The Hague (seat of government).
• C
ceived in 2023-24, up from USD 2.6 billion in 2022-23. • C
 onstitutional Monarchy with a Parliamentary system.
• About Netherlands: North Sea to the north and west, Germany to  ajor Rivers: Rhine, Meuse, and Scheldt.
• M
the east, and Belgium to the south. The Hindu

7.1.6 Yen Carry Trade

• G ained attention after yen sharply appreciated due to rate hike 0.25% and reduced bond purchases.
and reduced bond purchases.  his move suggested a shift toward normalizing policy, prompt-
• T
• Carry trade involves (1) borrowing in a low-interest ing investors to unwind carry trades.
country and (2) investing in higher-yield assets elsewhere. • U
 nwinding caused a major selloff in US tech stocks, impacting
• The yen is popular for carry trades due to Japan’s long-term zero- Asian markets, including India.
interest rate policy. • U
 nclear how much yen carry trade money went into India, but
• Investors borrow yen at low rates to invest in higher-yield foreign some likely did.
assets like US stocks. • S
 tronger yen could affect Indian companies with unhedged yen
• Yen rose over 3% against the dollar after BoJ raised rates to loans. CD
7.1.7 SCOMET List
• D GFT released the updated SCOMET list for 2024. (Development & Regulation) Act, 1992, which controls dual-use
• SCOMET stands for Special Chemicals, Organisms, Materi- exports and penalties for violations.
als, Equipment, and Technologies.  xport policies and procedures are detailed in Chapter 10 of the
• E
• Regulates export of dual-use items for civilian and military Foreign Trade Policy (FTP) and Handbook of Procedures (HBP)
purposes, especially WMD-related items. 2023.
• Managed by DGFT under the MCI (Ministry of Commerce and • D
 epartment of Defence Production (DDP) is now the licensing
Industry). authority for exports of sensors and lasers (Category 6).
• Notification issued under Appendix 3 to Schedule 2 of the ITC • E
 xporters require a license to ensure exports do not contribute to
(HS) Classification of Export and Import Items. WMD proliferation or unauthorized military use.
• Legal framework based on Chapter IVA of the Foreign Trade CD

7.2 Intellectual Property Rights in India

7.2.1 Passing off under Trademark Rules
 lady in New Delhi secured a trademark for her Mo-
• A • In Cadila Healthcare Limited vs. Cadila Pharmaceuticals Limit-
mos brand from New Delhi High Court after a similar trademark ed (2001), the Supreme Court defined passing-off as unfair trade
infringed her rights. competition.
• A trademark represents a business and registering it grants exclu- • Infringed parties can seek injunctions, damages, or ac-
sive rights to its usage. counts against the infringing entity.
• Trademarks Act of 1999 governs trademarks and their registration • Legal Provisions: Sections 11(1), 11(2), 11(3)(a), and 47 of
in India. Trademarks Act outline grounds for refusal and removal.
• Registered trademarks receive protection from the Controller • Section 11(1) bars registration of trademarks resembling earlier
General of Patents, Designs, and Trademarks. ones causing public confusion.
• Trademarks are valid for 10 years and can be renewed periodically • Section 47 allows removal of trademarks for non-compliance or
under Section 25 of the 1999 Act. non-use upon aggrieved parties’ applications.
• ‘Passing off’ involves deceptive practices where one brand The Indian Express
profits from another’s reputation.

7.2.2 India Club P&I Entity

Introduction: Why Establish the India Club?
• The Indian government plans to create an indigenous Protection • R
 educing External Dependence:
and Indemnity (P&I) entity, termed the “India Club.” • M
 inimizes reliance on international P&I Clubs.
• The initiative aims to provide insurance for ships operating on • R
 educes vulnerability to geopolitical risks and sanctions, as
domestic coasts and inland waterways. highlighted by the Russia-Ukraine conflict.
What is a P&I Club? • F
 ostering Domestic Capability:
• A P&I Club is a mutual insurance association for shipowners, char- • F
 ocuses on providing insurance for vessels operating within
terers, and operators. India’s coastal and inland waters.
• It offers coverage for third-party risks, such as: • S
 trengthens the domestic shipping industry’s resilience.
• Cargo damage. Operational Framework:
• Environmental liabilities (e.g., oil spills).  ed by the Ministry of Ports, Shipping, and Waterways.
• L
• War-related risks. • D
 omestic fleet owners will collaborate to establish the entity.
• Global P&I Clubs, primarily managed by the International Group of • T
 raditional insurance and reinsurance firms may underwrite risks.
P&I Clubs in London, cover about 90% of the world’s ocean-going • R
 egulatory oversight will be provided by the Insurance Regulatory
vessels. and Development Authority of India (IRDAI).
Benefits:

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• Autonomy in addressing insurance needs for domestic shipping. • F
 inancial Capacity:
• Enhances India’s strategic capacity in managing its maritime sector. • Ensuring adequate funds to cover large claims, especially for
• Potentially shields the industry from external disruptions. high-value cargo, could be a challenge.
Challenges: Conclusion:
• Limited Beneficiaries: • T
 he India Club represents a significant step toward enhancing
• Primarily benefits state-owned and smaller shipping entities, self-reliance in maritime insurance.
as many Indian-owned ships operate under foreign flags. • H
 owever, overcoming financial and global recognition challenges
• Global Acceptance: will be key to its success.
• Gaining recognition from international traders for India Club Live Mint
coverage might be difficult.

7.2.3 RoDTEP Scheme

• E xtension of tax refunds under the RoDTEP Scheme to outbound • It aligns with the WTO principles that taxes/duties should not be
shipments from SEZs and EOUs. exported.
• RoDTEP Scheme was introduced from January 1, 2021 as a duty • A pplicable to all export sectors regardless of turnover, with goods
remission scheme on exports. manufactured in India.
• It replaced the MEIS (Merchandise Export Incentive Schemes) • A pplies to merchant or manufacturer exporters directly export-
following a WTO dispute ruling against India. ing goods, including those through e-commerce platforms.
• Aimed at repealing and reducing taxes for exported products to • Refund Process: Rebate provided to eligible exporters as a
boost exports. percentage of the Freight on Board (FOB) value of exports.
• Administered by the Department of Revenue, Ministry of Finance. • Remission issued as transferrable e-scrips maintained in an
• RoDTEP provides reimbursement of taxes, duties, and levies not electronic credit ledger by CBIC.
refunded under any other mechanism. • E-scrips can be used for paying basic customs duty on imports or
• Includes direct costs incurred by exporters and prior transferred electronically to another party.
stage cumulative indirect taxes on goods. The Hindu

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8. INDUSTRY
Prelims PYQs
[UPSC CSE 2003] The government holding in BPCL is: [UPSC CSE 2005] Consider the following pairs:
(a) More than 70% 1. ADR (American Depository Receipt)
(b) Between 60% and 70% 2. GDR (Global Depository Receipt)
(c) Between 50% and 60% 3. SDR (Special Drawing Rights)
(d) Less than 50% Which of the above is/are treated as artificial currency?
(a) 1 only
[UPSC CSE 2003] During the year 2000-01, which one of the (b) 1 and 3 only
following industries recorded the highest growth rate in India? (c) 3 only
(a) Cement (d) 2 and 3 only
(b) Coal
(c) Electricity [UPSC CSE 2005] Consider the following statements:
(d) Steel 1. India is the only country in the world producing all the five known
commercial varieties of silk.
[UPSC CSE 2003] With reference to the Indian economy, consider 2. India is the largest producer of sugar in the world.
the following statements: Which of the statements given above is/are correct?
1. The maximum limit of shareholding of Indian promoters in private (a) 1 only
sector banks in India is 49 percent of the paid-up capital. (b) 2 only
2. Foreign Direct Investment up to 49 percent from all sources is (c) Both 1 and 2
permitted in private sector banks in India under the automatic (d) Neither 1 nor 2
route.
Which of these statements is/are correct? [UPSC CSE 2005] Which one of the following statements is NOT
(a) 1 only correct?
(b) 2 only (a) R ourkela Steel Plant was set up with the Soviet Union
(c) Both 1 and 2 collaboration.
(d) Neither 1 nor 2 (b) S alem Steel Plant is a premier producer of stainless steel in India.
(c) Maharashtra Elektrosmelt Ltd. is a subsidiary of SAIL.
[UPSC CSE 2003] With reference to India, which one of the following (d) Visakhapatnam Steel Plant is a unit of RINL.
statements is NOT correct?
(a) IPCL is India’s largest petrochemical company [UPSC CSE 2005] Which one of the following companies has started
(b) RIL is the largest private sector company in India a rural marketing network called ‘e-chaupals’?
(c) MTNL is listed on NYSE (a) ITC
(d) BSNL is the first telecom service organization in India to launch a (b) Dabur
nationwide cellular service at one time (c) Proctor and Gamble
(d) Hindustan Lever
[UPSC CSE 2004] Which one of the following was the largest IT [UPSC CSE 2009] In which one of the following States has India’s
software and services exporter in India during the year 2002-03? largest private sector sea port been commissioned recently?
(a) Birlasoft (a) Andhra Pradesh
(b) Infosys Technologies (b) Karnataka
(c) Tata Consultancy Services (c) Kerala
(d) Wipro Technologies (d) Tamil Nadu

[UPSC CSE 2004] In the last one decade, which one among the [UPSC CSE 2009] In India, the ports are categorized as major and
following sectors has attracted the highest Foreign Direct Investment non-major ports. Which one of the following is a non-major port?
inflows into India? (a) Kochi
(a) Chemicals other than fertilizers (b) Dahej
(b) Services sector (c) Paradip
(c) Food processing (d) New Mangalore
(d) Telecommunication
[UPSC CSE 2010] The SEZ Act, 2005, which came into effect in
[UPSC CSE 2004] Consider the following statements: February 2006, has certain objectives. In this context, consider the
1. National Thermal Power Corporation has diversified into the following:
hydropower sector. 1. Development of infrastructure facilities.
2. Power Grid Corporation of India has diversified into the telecom 2. P
 romotion of investment from foreign sources.
sector. 3. Promotion of exports of services only.
Which of the statements given above is/are correct? Which of the above are the objectives of this Act?
(a) 1 only (a) 1 and 2 only
(b) 2 only (b) 3 only
(c) Both 1 and 2 (c) 2 and 3 only
(d) Neither 1 nor 2 (d) 1, 2 and 3

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[UPSC CSE 2010] Which one of the following was not stipulated in [UPSC CSE 2017] With reference to ‘National Investment and
the Fiscal Responsibility and Budget Management Act, 2003? Infrastructure Fund’, which of the following statements is/are correct?
(a) Elimination of revenue deficit by the end of fiscal year 2007-08 1. It is an organ of NITI Aayog.
(b) N on-borrowing by the central government from the Reserve Bank 2. It has a corpus of Rs. 4,00,000 crore at present.
of India except under certain circumstances Select the correct answer using the code given below:
(c) Elimination of primary deficit by the end of the fiscal year 2008-09 (a) 1 only
(d) F ixing government guarantees in any financial year as a (b) 2 only
percentage of GDP (c) Both 1 and 2
(d) Neither 1 nor 2
[UPSC CSE 2010] Which one of the following is responsible for the
preparation and presentation of the Union Budget in Parliament?
(a) Department of Revenue
(b) Department of Economic Affairs
(c) Department of Financial Services
(d) Department of Expenditure

8.1 Make in India: Challenges & Prospects

8.1.1 Ten years of Make in India
• L aunched on September 25, 2014, “Make in India” Programme. lakh jobs.
• Led by DPIIT, Ministry of Commerce & Industry. • P M GatiShakti improved logistics and transport connectivity.
• Aims to turn India into a global manufacturing and investment • I ndia received $667.41 billion in FDI from 2014-2024.
hub. • Indigenous projects like INS Vikrant and Vande Bharat
• Focuses on attracting foreign investment, promoting industrial- Trains boosted manufacturing.
ization, and driving export-led growth. • India’s EODB rank improved from 142nd to 63rd.
• Make in India 2.0 covers 27 sectors, including strategic manufac- • M anufacturing’s share in GDP remained flat at 17.3% in 2023-
turing and services. 24, similar to 2013-14.
• Target to increase the manufacturing share in GDP from 16% to • E mployment fell from 6% (2013-14) to 10.6% (2022-23).
25% by 2022. • India’s global export share rose from 1% (2005-06) to 1.8% by
• Planned to create 10 crore jobs and achieve 12-14% annual 2022-23.
manufacturing growth. • Imports as a share of GDP rose back to 25% in 2023-24, similar to
• India is now the second-largest mobile phone producer globally. 2013-14 levels.
• PLI Schemes attracted ₹1.97 lakh crore investment, creating 8 CD

8.2 Industrial Sector Updates – Industrial Policy, Ease of Doing Business, etc.
8.2.1 Index of Industrial Production (IIP)
• R ose by 5.7% in February, up from January’s 3.8%, per MoSPI data.  asket of Products includes 6 sub-categories: 1) Prima-
• B
• IIP tracks overall manufacturing activity in an economy. ry Goods (mining, electricity, fuels, fertilisers). 2) Capital
• Currently based on 2011-2012, changed from 2004-05 to Goods (machinery items). 3) Intermediate Goods (yarns, chem-
2017; Compiled and published monthly by CSO under MoSPI. icals, semi-finished steel). 4) Infrastructure Goods (paints,
• Components of IIP: Manufacturing (77.6%), Mining (14.4%), Elec- cement, cables, rail materials). 5) Consumer Durables (garments,
tricity (8%). telephones, vehicles). 6) Consumer Non-durables (food items,
• Eight core industries like electricity, crude oil, coal, etc., make up medicines, toiletries).
40% of IIP weight. CD

8.2.2 HAL becomes 14th Maharatna Company

• C entre upgraded Hindustan Aeronautics Ltd (HAL) from Navrat- • L
 isted on BSE and NSE in 2018, enabling public investment.
na to Maharatna status. • E
 xports to countries such as Vietnam, Mauritius, and Ecuador.
• Founded in 1940 as Hindustan Aircraft Limited; merged • C
 urrent projects include AMCA, IMRH, and Tejas Mk2, boosting
with Aeronautics India Limited in 1964. defense capabilities.
• State-owned, under the Ministry of Defence, headquartered • M
 aharatna Companies: Recognized PSUs in India with higher
in Bengaluru. financial and operational autonomy than Navratna or Miniratna.
• It has 20 production and R&D centers in locations like Banga- • E
 ligibility:
lore, Nashik, Koraput, and Lucknow. • Annual turnover of ₹25,000+ crore for three years.
• Focuses on aircraft, helicopter, engine, avionics, and aero- • Net worth above ₹15,000 crore in the last three years.
space equipment design and maintenance. • Net profit of ₹5,000 crore+ for three consecutive years.
• Produces Tejas LCA, Sukhoi Su-30MKI, Jaguar, and Hawk • A
 utonomy:
• Manufactures helicopters like Dhruv ALH, Rudra, Cheetah, Che- • Can invest up to ₹5,000 crore or 15% of net worth in a
tak, and LCH. project without government approval.
• Partners with Boeing, Airbus, Rosoboronexport, and Safran for • Permitted to invest in strategic resources or collaborations,
production and technology transfer. domestically and internationally. Live Mint

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8.2.3 Organisation for the Prohibition of Chemical Weapons (OPCW)-The Hague Award:
• C onferred upon the Indian Chemical Council (ICC) of OPCW in • T he Executive Council comprises a 41-member body overseeing
The Hague. CWC implementation.
• ICC is the premier body representing India’s chemical industry, • 1 93 States-Parties, open to all nations meeting requirements.
established in 1938. • N on-Signatories: Egypt, North Korea, and South Sudan have not
• Chemical Weapons Convention (CWC) bans development, use, signed or ratified the CWC.
stockpiling of chemical weapons, mandates their destruction. • O PCW implements CWC, headquartered in The Hague.
• Genesis: Negotiations began in 1980. • Role: Oversees destruction of chemical weapons and
• Established: Opened for signature on Jan 13, 1993, entered into ensures treaty compliance.
force on April 29, 1997. • Inspection: Conducts inspections of chemical facilities
• More comprehensive than the 1925 Geneva Protocol, which only • Nobel Peace Prize: OPCW won in 2013 for efforts in chemical
banned use of chemical weapons. weapons elimination.
• CSP (Conference of States Parties): Main decision-making body, CD
meets annually.

8.3 Textile Sector – Cotton, Jute, Wool, Silk, Handloom, etc.

8.3.1 Eri Silk
• N
 EHHDC (Ministry of DoNER) obtained Oeko-Tex certifica-  ri Silk is a GI-tagged product from Assam.
• E
tion for Eri Silk. • O
 eko-Tex certifies textiles as free from harmful substances and
• Eri Silk is vegan; the moth is not killed but exits the cocoon eco-friendly.
naturally.  ertification boosts Eri Silk’s authenticity and importance as an
• C
• Made from Philosamia ricini silkworms, which eat castor leaves. Assamese product.
• Primarily produced in Assam and northeastern India; also in Bi- CD
har, West Bengal, and Orissa.

8.3.2 SAMARTH Scheme

• C entre extended the scheme to FY 2024-25 and 2025-26 with a • India holds a 4% share in global textile and apparel trade.
₹495 crore budget. • In FY22, India ranked third-largest in textile exports with a 5.4%
• Aims to train 3 lakh people in textile skills; under the Ministry of global share.
Textiles • India is a top producer of cotton, jute and second in silk; 95% of
• Aims to create jobs across the textile value chain, excluding hand-woven fabric globally is from India.
spinning and weaving. • T he textile industry is the second-largest employer in India, provid-
• Provides upskilling and reskilling to boost productivity in Apparel ing 45 million direct and 100 million allied jobs.
& Garmenting. • L eading textile states: Andhra Pradesh, Telangana, Haryana,
• 27 lakh trained (88.3% women); 2.6 lakh (79.5%) placed in jobs. Jharkhand, and Gujarat.
• The textile industry contributes 3% to GDP, 13% to industrial CD
production, and 12% to exports.

8.4 Electronic System Design & Manufacturing Sector – M-SIPS, National Policy on Electronics, etc.
8.4.1 India Semiconductor Mission (ISM)
• F ifth plant under the India Semiconductor Mission (ISM) to be set manufacturing, and design companies.
up in Sanand, Gujarat. • E ncourages indigenous IP creation and technology transfer (ToT).
• ISM has administrative and financial powers to promote • F our schemes under ISM: (1) Semiconductor Fabs in India; (2)
semiconductor manufacturing, packaging, and design in India. Display Fabs in India.
• Launched in 2021 with ₹76,000 crore under MeitY. • ( 3) Compound Semiconductors/Silicon Photonics/Sensors Fab,
• Aims to create a sustainable semiconductor and display ecosys- Semiconductor ATMP/OSAT facilities. (4) Design Linked Incentive
tem. (DLI) Scheme.
• Provides financial incentives for semiconductor, display CD

8.5 Corporate Social Responsibility: Issues & Development

8.5.1 CIL ASHIS Scheme
• C oal India Limited (CIL) has launched a CSR initiative named CIL • T
 argets 1,645 children identified as needing assistance.
ASHIS. • C
 ompassionate Appointment for dependents of CIL employees
• CIL ASHIS Scheme stands for Ayushman Shiksha Sahayata. who died while in service.
• Aims to provide scholarships to children who lost their parents • B
 eneficiaries need to apply through CIL’s established procedures.
to COVID-19 and could not continue their studies. CD
• Each eligible child receives ₹45,000 per year; scholarship provid-
ed for 4 years.

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8.6 Defence Sector – DPP, Missions, Schemes, Security Forces, etc.
8.6.1 ADITI Scheme
• T he Union Minister of Defence unveiled the ADITI scheme
during DefConnect 2024 in New Delhi, aiming to foster innovation
in critical and strategic defence technologies
• ADITI, which stands for Acing Development of Innovative Technolo-
gies with iDEX, aims to develop approximately 30 deep-tech criti-
cal and strategic technologies within the specified timeframe.
• Start-ups are eligible to receive a grant-in-aid of up to Rs 25
crore under this scheme for their research, development, and
innovation endeavors in defence technology.
• The scheme is allocated a budget of Rs 750 crore from 2023-24 to
2025-26.
• ADITI operates under the iDEX (Innovations for Defence Ex-
cellence) framework of the Department of Defence Production,
Ministry of Defence.
• It includes the creation of a ‘Technology Watch Tool’ to bridge the
gap between the expectations of the modern Armed Forces and the
capabilities of the defence innovation ecosystem.
• The inaugural edition of ADITI launched 17 challenges, covering
areas specified by the Indian Army, Indian Navy, Indian Air Force,
and Defence Space Agency.
• To further incentivize young innovators, iDEX was expanded
to iDEX Prime, increasing the assistance from Rs 1.5 crore to Rs 10
crore.
CD

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9. INFRASTRUCTURE
Prelims PYQs
[UPSC CSE 2009] In which one of the following States has India’s [UPSC CSE 2016] Recently, which of the following States has
largest private sector sea port been commissioned recently? explored the possibility of constructing an artificial inland port to be
(a) Andhra Pradesh connected to the sea by a long navigational channel?
(b) Karnataka (a) Andhra Pradesh
(c) Kerala (b) Chhattisgarh
(d) Tamil Nadu (c) Karnataka
(d) Rajasthan
[UPSC CSE 2009] In India, the ports are categorized as major and
non-major ports. Which one of the following is a non-major port? [UPSC CSE 2022] Consider the following statements:
(a) Kochi 1. G
 ujarat has the largest solar park in India.
(b) Dahej 2. K erala has a fully solar-powered International Airport.
(c) Paradip 3. Goa has the largest floating solar photovoltaic project in India.
(d) New Mangalore Which of the statements given above is/are correct?
(a) 1 and 2
[UPSC CSE 2009] The Dul Hasti Power Station is based on which (b) 2 only
one of the following rivers? (c) 1 and 3
(a) Beas (d) 3 only
(b) Chenab
(c) Ravi [UPSC CSE 2023] Consider the following airports:
(d) Sutlej 1. Donyi Polo Airport
2. Kushinagar International Airport
[UPSC CSE 2010] The SEZ Act, 2005 which came into effect in 3. Vijayawada International Airport
February 2006 has certain objectives. In this context, consider the In the recent past, which of the above have been constructed as
following: Greenfield projects?
1. Development of infrastructure facilities. (a) 1 and 2 only
2. Promotion of investment from foreign sources. (b) 2 and 3 only
3. P romotion of exports of services only. (c) 1 and 3 only
Which of the above are the objectives of this Act? (d) 1, 2, and 3
(a) 1 and 2 only
(b) 3 only [UPSC CSE 2023] With reference to India’s projects on connectivity,
(c) 2 and 3 only consider the following statements:
(d) 1, 2, and 3 1. East-West Corridor under Golden Quadrilateral Project connects
Dibrugarh and Surat.
[UPSC CSE 2014] Consider the following statements: 2. T he Trilateral Highway connects Moreh in Manipur and Chiang Mai
1. NH4 connects Chennai and Hyderabad. in Thailand via Myanmar.
2. NH6 connects Mumbai and Kolkata. 3. Bangladesh-China-India-Myanmar Economic Corridor connects
3. N H15 connects Ahmedabad and Jodhpur. Varanasi in Uttar Pradesh with Kunming in China.
Which of the above pairs is/are correctly matched? How many of the above statements are correct?
(a) 1 and 2 only (a) Only one
(b) 3 only (b) Only two
(c) 1, 2, and 3 only (c) All three
(d) None (d) None

[UPSC CSE 2016] Recently, India’s first ‘National Investment and

Manufacturing Zone’ was proposed to be set up in:
(a) Andhra Pradesh
(b) Gujarat
(c) Maharashtra
(d) Uttar Pradesh

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9.1 Roads and Highways
9.1.1 Mumbai Trans Harbour Link
The Mumbai Trans Harbour Link (MTHL), also known as Atal Setu, is a from two hours to approximately 20 minutes.
significant infrastructure project inaugurated on January 12, 2024. • C apacity: Designed to handle 70,000 vehicles daily, with a speed
Key Features: limit of 100 km/h for four-wheelers; two-wheelers and auto-
• Length: Spanning 22 km, it is India›s longest sea bridge, comprising rickshaws are not permitted.
a 16.5 km sea bridge and a 5.5 km elevated road. • I nterchanges: Provides connectivity at Sewri, Shivajinagar, State
• Route: Connects Sewri in South Mumbai to Chirle near Nhava She- Highway-54, and NH-348, facilitating access to Pune, Goa, and
va in Navi Mumbai, reducing the commute from 42 km to 22 km. southern India.
• Travel Time: Cuts the journey between Mumbai and Navi Mumbai The Hindu

9.1.2 India’s Longest Cable-Stayed Bridge ‘Sudarshan Setu’

• India’s longest cable-stayed bridge, spanning32 km over the island off the coast of Dwarka, Gujarat.
Arabian Sea. • S ituated at the mouth of the Gulf of Kutch, the island features
• It connects Beyt Dwarka to mainland Okha in Gujarat’s Devbhumi temples, white sand beaches, and coral reefs.
Dwarka district. • B elieved to be the residence of Lord Krishna during his reign as
• Features a unique design with a footpath adorned with verses king of Dwarka.
from the Bhagavad Gita and images of Lord Krishna. • D erived its name from the word ‘bet’, meaning ‘gift’, as it is believed
• Solar panels installed on the upper portions of the footpath that Lord Krishna received it from his friend Sudama.
generate one megawatt of electricity. • Excavations reveal settlements dating back to the Harappan
• Constructed at a cost of Rs 979 crore, including a central dou- civilization and the Mauryan rule.
ble-span cable-stayed portion and a 2.45 km approach road. The Hindu
• Beyt Island, also known as Bet Dwarka or Shankodhar, is a small

9.1.3 Sela Tunnel

• T he Prime Minister inaugurated Sela Tunnel, a crucial milestone (BRO) under Project Vartak, construction began on April 1, 2019.
in India’s border infrastructure development, especially in the  ear the Sela Pass, the tunnel offers all-weather connec-
• N
strategic Tawang sector. tivity crucial due to frequent closures of the Balipara-Charid-
• Sela Tunnel holds the distinction of being the longest bi-lane road war-Tawang Road during heavy snowfall and landslides.
tunnel globally, situated at an altitude exceeding 13,000 feet.  acilitates rapid deployment of weapons, soldiers, and equip-
• F
• Located in the West Kameng district of Arunachal Pradesh, it ment to forward areas near the Line of Actual Control (LAC).
connects Tezpur, Assam, with Tawang, Arunachal Pradesh. The Indian Express
• Constructed by the Border Roads Organisation

9.1.4 Z-Morh Tunnel Project

• M ilitants attacked workers on the Z-Morh tunnel project.  ocated on the Srinagar-Sonamarg-Leh highway, at an altitude
• L
• 4 km tunnel near Gagangir village, linking Sonamarg to Kangan over 8,500 feet.
in Ganderbal district, central Kashmir.  amed after the Z-shaped road stretch where it is constructed.
• N
• Part of the larger Zojila tunnel project to ensure year-round con-  riginally conceived by BRO (Border Roads Organisation) in 2012.
• O
nectivity between Srinagar and Ladakh.  soft opening took place in February 2024; full inauguration is
• A
pending.
 rovides all-weather access to Sonamarg, keeping the tourist
• P
destination open year-round.
 ey for year-round connectivity to Ladakh, a strategically vital re-
• K
gion due to military presence along the Pakistan and China borders.
The Indian Express

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9.2 Rural Infrastructure Schemes
9.2.1 PM Gram Sadak Yojana- Phase IV
• C entre approved Phase IV of the PMGSY. roads, connecting 25,000 unconnected habitations.
• Launched in 2000 by former PM Atal Bihari Vajpayee to connect  mphasis on Left-Wing Extremism (LWE) areas, tribal regions,
• E
unconnected habitations. and remote locations.
• Nodal agency: Ministry of Rural Development; Centrally Spon- • R
 oad connectivity for 25,000 villages, improving access to previ-
sored ously isolated rural areas.
• Phase I: Focused on connecting unconnected habitations.  nhanced infrastructure using eco-friendly materials and
• E
• Phase II: Upgraded roads from Phase I to boost rural infrastructure. technologies like Cold Mix, Waste Plastic, Fly Ash, and Steel
• Phase III: Consolidated 25 lakh km of rural roads to connect Slag.
habitations to agricultural markets, schools, and hospitals. The Indian Express
• Phase IV: Aims to build 62,500 km of all-weather

9.3 Railways
9.3.1 Kalka-Shimla Heritage Railway Track
• H imachal CM requested the Centre to run the Kalka-Shimla • D iesel locomotives were introduced in 1955, followed by die-
narrow-gauge railway on green hydrogen to promote clean sel-hydraulic models in 1970.
energy. • UNESCO Heritage: Designated as a UNESCO World Heritage Site
• Kalka-Shimla Railway: A 2 ft 6 in narrow-gauge railway construct- on 8 July 2008, part of the “Mountain Railways of India.”
ed in 1898 to connect Shimla with the Indian rail system under S. • The Darjeeling Himalayan Railway, Nilgiri Mountain Railway,
Harington. and Kalka–Shimla Railway are part of the “Mountain Railways of
• Length: 6 km, with 107 tunnels (102 in use) and 864 bridges. India.”
• Features: 1 in 33 gradients, 919 curves (sharpest at 48 degrees). • Matheran Hill and Kangra Valley Railways are also included.
• Elevation: Starts at 656 meters (Kalka), rises to 2,076 meters The Hindu
(Shimla), with a height difference of 1,420 meters.

9.3.2 Kolkata Underwater Metro Tunnel

• T he Prime Minister inaugurated India’s first underwater metro • F our operational lines with a total length of 38 km and 48 stations.
tunnel, a milestone in infrastructure development. • T he Project was funded through a loan from the Japan Interna-
• Part of the Howrah Maidan-Esplanade section of Kolkata Metro’s tional Cooperation Agency (JICA).
East-West corridor. • Hooghly River is a distributary of the Ganges River in West
• Covers a distance of 8 km under the Hooghly River, with a rapid Bengal.
travel time of just 45 seconds across a 520-metre stretch. • Originates at Tribeni and stretches approximately 260 km.
• Kolkata Metro is India’s first operational rapid transit system, • Hosts iconic structures like Howrah Bridge and Victoria Memori-
opened in 1984. al, enriching Kolkata’s cultural landscape.
• Second busiest and fourth-longest metro network in India as of The Hindu
January 2023.

9.3.3 Banihal-Sangaldan Railway Line

• T he Prime Minister inaugurated the railway line and launched the country, T-50.
first electric train in the Kashmir Valley from Baramulla station. • F
 eatures 16 bridges and 3 escape tunnels (30.1 km) for
• Aims to connect Baramulla in North Kashmir to Udhampur in passenger safety.
Jammu.  he 185-km stretch between Baramulla and Sangaldan has been
• T
• Part of the Udhampur-Srinagar-Baramulla Rail Link (US- electrified at a cost of Rs 470 crore.
BRL) project for better connectivity to the Kashmir Valley.  rants access to attractions like hot water springs near Sangal-
• G
• Over 90% of the 48-km line passes through tunnels in Ram- dan and the scenic Gool Valley.
ban district, including the longest transportation tunnel in the The Indian Express

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9.4 Port Infrastructure and Shipping Industry – Sagarmala Project, SDC, CEZ, etc.
Port Location Key Facts
Vadhavan Port Vadhavan, - Type: Proposed all-weather greenfield deep draft major port.
Palghar District, - Natural Depth: 20 meters, suitable for large vessels.
Maharashtra - Project Cost: ₹76,200 crore.
- Development: Joint venture between Jawaharlal Nehru Port Authority (74% stake) and
Maharashtra Maritime Board (26% stake).
- Significance: Aims to enhance India’s port capacity and accommodate ultra-large container
ships. (indianexpress.com)
Murbe Port Murbe, Maha- - Type: Identified location for port development.
rashtra - Status: Part of Maharashtra’s broader maritime infrastructure plans.
- Details: Specific project details are limited as of now.
Keni Port Keni Village, - Type: Proposed deep-sea port.
Uttara Kannada - Investment: ₹4,119 crore.
District, Karna- - Developer: JSW Infrastructure.
taka - Significance: Expected to enhance maritime trade in Karnataka. (thehindu.com)
Ramayapatnam Ramayapatnam, - Type: Upcoming deep-water port.
Port Andhra Pradesh - Investment: Part of a combined ₹16,000 crore investment for four new seaports in Andhra
Pradesh.
- Significance: Aims to boost the state’s maritime trade capabilities. (thehindu.com)
Machilipatnam Machilipatnam, - Type: Greenfield deep-sea port.
Port Krishna District, - Initial Cargo Capacity: 35 million tonnes per annum.
Andhra Pradesh - Development: Construction launched in May 2023.
- Significance: Expected to significantly contribute to the region’s economic development.
(thehindu.com)
Vizhinjam Port Vizhinjam, near - Type: Deep-water container transshipment port.
Thiruvananthapu- - Strategic Location: Near international shipping routes.
ram, Kerala - Developer: Adani Ports.
- Status: First phase expected to be completed by December 2024.
- Significance: Poised to position India as a rival to major global shipping hubs. (reuters.
com)

9.4.1 Paradip Port

•P aradip Port in Odisha achieves a historic milestone, becoming In-
dia’s largest major port by cargo volumes in FY24.
• S
 ituated at Mahanadi River-Bay of Bengal confluence, commis-
sioned in 1966 for eastern India’s maritime trade.
• M
 anaged by Paradip Port Trust under Major Port Trusts Act, 1963.
• D
 eep-Draft Port: Extensive berthing facilities and cargo-handling
equipment.
 trategic Importance: Vital link for eastern and central India’s
• S
trade.
• C
 argo throughput recorded 145.38 MMT in FY23-24, surpassing
Deendayal Port.
 oastal Shipping Traffic: Highest-ever traffic of 59.19 MMT,
• C
1.30% growth.
 perating revenue exceeded Rs 2,300 crore, up by 14.30%.
• O
 oised to exceed 300 million tonnes capacity in next 3 years.
• P
The Economic Times

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9.4.2 Great Nicobar Island (GNI) Project
• O
 pposition demands immediate suspension of all clearanc- Rights Act (FRA) before project clearance.
es granted to NITI Aayog’s GNI Project. • F RA mandates recognition and vesting of rights to locals before
• The GNI Project is implemented by ANIIDCO (Andaman and forest land diversion.
Nicobar Islands Integrated Development Corporation). • S tage-I clearance granted after two-year delay from application.
• Plans for port development date back to the 1970s. • N o processing of forest land claims under FRA despite monthly
• Includes a transshipment port, dual-use airport, power plant, and progress reports.
township over 30 years. • T ribal Council withdrew consent granted by Gram Sabha weeks
• Transshipment Hub aims to be a major player in the global mari- after Stage-I clearance.
time economy. • G reat Nicobar Island: Southernmost part of India, part of the
• Port to be controlled by Indian Navy, airport to have dual mili- Andaman and Nicobar archipelago.
tary-civilian functions. • H ome to endangered species like the giant leatherback tur-
• Includes infrastructure for tourism and public utilities; GNI stra- tle and Nicobar megapode.
tegically located for cargo transshipment. • S hompen Tribe (hunter-gatherers) and Nicobarese (farmers and
• Key for national security amid increasing Chinese presence in fishermen) are indigenous communities.
the Indian Ocean. • C ampbell Bay serves as the administrative center.
• Deforestation of 130 sq km threatens biodiversity. • [ Nicobar Triangle: Includes Nicobar Islands, Andaman Islands,
• Displaces indigenous tribes and lacks comprehensive impact and the Indonesian Archipelago.]
assessments. The Hindu
• Failure to recognize forest land ownership under the Forest

9.4.3 Approval of Major Port at Vadhavan

• T he Ministry of Ports, Shipping and Waterways has approved a Europe, the Middle East, Africa, and America.
project for a Major Port at Vadhavan, Palghar District (Mh). • I ndia has 12 Major Ports: Chennai, Cochin, Deendayal (Kandla),
• The project will develop core infrastructure, terminals, and commer- Jawaharlal Nehru (Nhava Sheva), Kolkata, Mormugao, Mumbai, New
cial facilities via public-private partnership (PPP). Mangalore, Paradip, V.O. Chidambaranar (Tuticorin), Visakhapat-
• Shareholding: Jawaharlal Nehru Port Authority (74%), Maharashtra nam, and Kamarajar Port Limited.
Maritime Board (26%). • P rivate sector participation is allowed in Major Ports for specific
• Aims for a total capacity of 298 million metric tonnes per an- projects/berths/terminals through concession agreements via
num (MMTPA). competitive bidding.
• Will support EXIM trade through the India-Middle East-Europe • A fter the concession period, assets are handed over to the Port
Economic Corridor and the International North-South Transpor- Authority.
tation Corridor. CD
• Accommodates mainline mega vessels linking the Far East,

9.4.4 Bihta Inland Container Depot (ICD)

• B
 ihar inaugurated its first dry port in Bihta, near Patna, to en-
hance exports.
• The first export from Bihta ICD was leather shoes sent to Rus-
sia.
• A dry port, or inland container depot (ICD), is a logistics hub away
from seaports or airports.
• Provides cargo handling, storage, and transport facilities to
simplify exports and imports.
• India’s first dry port opened in Varanasi in 2018.
• Serves as a link between inland areas and international ship-
ping routes through major ports.
• Bihta ICD, near Patna, Bihar, operates under a Public-Private
Partnership (PPP).
• Approved by the Department of Revenue, Union Ministry of
Finance.
• Managed by Pristine Magadh Infrastructure Private Limited in
partnership with Bihar’s industry department.
• Connected by rail to key Indian ports: Kolkata, Haldia, Visakhapa-
tnam, Nhava Sheva, and Mundra.
• Eases goods transport for eastern India, benefiting Bihar,
Jharkhand, Uttar Pradesh, and Odisha.
The Indian Express

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9.5 Civil Aviation and Air Cargo
9.5.1 Twenty-one Greenfield Airports are to be set up in the country, 11 are operationalized

Airport Location Status Additional Details Source

Mopa Airport Mopa, Goa Operational - Inaugurated: December 2022. - Mint

- Significance: Enhances tourism and connectivity in
Goa.
- Renamed: Manohar International Airport – Mopa.

Navi Mumbai Navi Mumbai, Under Con- - Estimated Cost: ₹16,704 crore. - The Indian
International Maharashtra struction - Purpose: To decongest Mumbai’s Chhatrapati Shivaji Express
Airport Maharaj International Airport.
- Inauguration Scheduled: April 17, 2025.

Shirdi Airport Shirdi, Maharashtra Operational - Inaugurated: October 2017. - Mint

- Purpose: Facilitates pilgrims to travel to the Shirdi
Sai Baba temple.

Sindhudurg Sindhudurg, Operational - Inaugurated: March 2019. - Mint

Airport Maharashtra - Significance: Boosts tourism in the Konkan region.

Kalaburagi Airport Kalaburagi, Operational - Inaugurated: November 2019. - Mint

Karnataka - Purpose: Enhances regional connectivity in Karnata-
ka.

Vijayapura Airport Vijayapura, Under Develop- - Status: Awaiting further approvals and development. - Mint
Karnataka ment

Hassan Airport Hassan, Karnataka Under Develop- - Status: Awaiting further approvals and development. - Mint
ment

Shivamogga Shivamogga, Karna- Operational - Inaugurated: February 2023. - Mint

Airport taka - Significance: Improves connectivity in central Karna-
taka.

Dabra (Gwalior) Dabra, Gwalior, Mad- Under Develop- - Status: ‘In-Principle’ approval granted; development - Mint
Airport hya Pradesh ment in progress.

Kushinagar Airport Kushinagar, Uttar Operational - Inaugurated: October 2021. - Mint

Pradesh - Significance: Important for Buddhist pilgrimage
tourism.

Noida (Jewar) In- Jewar, Uttar Pradesh Under Con- - Estimated Cost: ₹8,914 crore (Phase I). - Mint
ternational Airport struction - Purpose: To serve the NCR region and decongest IGI
Airport, Delhi.

Dholera Interna- Dholera, Gujarat Under Develop- - Estimated Cost: ₹1,305 crore. - The Indian
tional Airport ment - Purpose: To serve the Dholera Special Investment Express
Region.
- Phase-1 Approval: Received from Cabinet Committee
on Economic Affairs in June 2022.
- Expected Operational Date: 2025-26.

Hirasar (Rajkot Hirasar, near Rajkot, Operational - Inaugurated: July 2023. - Mint
International) Gujarat - Significance: Enhances connectivity for Rajkot and
Airport the Saurashtra region.
- Features: Modern technology, sustainable design,
and cultural elements reflecting the vibrancy of Rajkot.
- Recent Incident: In June 2024, a canopy at the pas-
senger pickup and drop area collapsed due to heavy
rainfall; no injuries reported.

(https://pib.gov.in/PressReleaseIframePage.aspx?PRID=1906346)

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9.5.2 DigiYatra Initiative
 igiYatra is a facial recognition-based air travel pro-
• D • T
 he DigiYatra Foundation claims the system is designed with
gram introduced by the Indian government to simplify and privacy at its core:
streamline passenger processing at airports. • Data is stored in an encrypted format on the passenger’s
• Launched under the Ministry of Civil Aviation, it aims to make air device.
travel paperless and hassle-free. • Information is shared with airport systems only when the
Key Features: passenger travels.
1. S eamless Travel: • Data is automatically deleted within 24 hours of the flight.
• Passengers registered with DigiYatra can move through 5. Integration Across Airports:
checkpoints such as check-in, security checks, and boarding • T
 he program is being rolled out in phases.
using facial recognition technology. • D
 igiYatra is already operational at several major airports,
• Reduces reliance on physical documents like boarding passes including:
and ID cards. • Indira Gandhi International Airport (Delhi).
2. V  oluntary Enrollment: • K empegowda International Airport (Bengaluru).
• Registration is optional, allowing passengers to decide whether • L al Bahadur Shastri Airport (Varanasi).
they wish to participate in the program. • M
 ore airports, including Hyderabad, Kolkata, and Pune, are in
3. P  aperless Process: the pipeline for integration.
• A secure digital identity created using passengers’ Aadhaar 6. F acial Recognition Usage:
details, photographs, and phone numbers is used for authen- • T
 echnology matches a passenger’s face with their travel
tication. records for identity verification.
4. D  ata Privacy and Security: The Hindu

9.5.3 Asia Pacific Ministerial Conference on Civil Aviation (APMCCA)

• I ndia will host the second APMCCA in September organized by efficiency, and environmental protection.
the Indian government and International Civil Aviation Organization • P  romotes safe and orderly growth of international air transport.
(ICAO). • A  ssembly: Meets every 3 years, includes all member states.
• Asia Pacific Ministerial Conference on Civil Aviation: Aims to • C  ouncil: Governing body with 36 elected member
strengthen regional collaboration and develop a future-focused • S  ecretariat: Led by the Secretary General, manages daily opera-
vision for innovation and safety. tions.
• Inaugural conference in February 2018 in Beijing. • 1 93 member states as of 2024; Open to all states subscribing to
• 39 ICAO member states from the Asia Pacific region are expected Chicago Convention principles.
to attend. • I ndia is a founding member, joined in 1944.
• The region accounts for 41% of global flight departures. • I nitiatives: Universal Safety Oversight Audit Programme (USOAP);
• Passenger numbers are expected to increase from 4.5 billion to 11.5 Universal Security Audit Programme (USAP); Next Generation
billion by 2050. Aviation Professionals (NGAP); No Country Left Behind (NCLB).
• ICAO was founded on December 7, 1944, by the Chicago Con- • G
 lobal Aviation Safety Plan (GASP) and Global Air Naviga-
vention on International Civil Aviation. tion Plan (GANP): Strategic documents for aviation safety and
• Became a UN specialized agency in 1947; HQ: Montreal, Canada. navigation improvements.
• Develops international standards for aviation safety, security, The Hindu

9.6 Water Management – Institutional Reforms, Conservation Efforts, etc.

9.6.1 Nohar Irrigation Project
• F erozepur feeder repair boosts Nohar irrigation project in Punjab. reservoirs, water storage.
• Formerly known as Sidhmukh Nohar Irrigation Project in • D raws water from Indira Gandhi Canal near the Ghaggar-Hakra
Rajasthan’s Hanumangarh district. River.
• Initiated by Rajiv Gandhi in 1989, officially launched in 2002. • IGC originates at Harike Barrage in Punjab.
• Funded by EEC (European Economic Community). • L ongest canal in India, spanning 612 km.
• Aims to enhance irrigation, increase agricultural productivity, and • U tilizes water from Sutlej, Beas & Ravi rivers.
support local farmers’ livelihoods. • R enamed from Rajasthan Canal to Indira Gandhi Canal in 1984.
• Utilizes canal irrigation, includes the construction of check dams, The Hindu

9.6.2 Kiru Hydel Project

• C
 BI conducts searches at 12 locations in Delhi and Rajasthan re-  ydropower Plant components: 135m-high concrete gravity
• H
lated to alleged corruption in Kiru Hydel Project civil works worth dam near Kiru; Catchment area of 10,225km²; 6.5km-long reservoir;
₹2,200 crore. 700m-long horse-shoe shaped diversion tunnel.
• Located over Chenab River near Patharnakki and Kiru villages in • R
 un-of-the-River Hydroelectric systems generate electricity
Kishtwar district, Jammu and Kashmir. using flowing water without large dams.
• Capacity: 624MW run-of-river project. • U
 tilize natural river flow diverting water through turbines to
• Developers: Chenab Valley Power Projects (CVPP), a joint venture minimize environmental impact.
of NHPC (49%), JKSPDC (49%), and PTC (2%).  hey have lower ecological disruption, reduced flood risk, and
• T
• Beneficiary States are J&K, Himachal Pradesh, Punjab, Haryana, faster project implementation compared to conventional hydroelec-
Uttar Pradesh, Uttaranchal, Rajasthan, Chandigarh, and Delhi. tric dams. The Hindu

Flash Notes: ECONOMY HQ: Ground Floor, Apsara Arcade, ORN, New Delhi-05 80765 17832 42
9.6.3 Pancheshwar Multipurpose Project (PMP)
• D espite a recent agreement between India and Nepal, discus- • U pon completion, PMP is anticipated to generate 5,040 mega-
sions over the Pancheshwar Multipurpose Project (PMP) remain watts (MW) of electricity and rank among the world’s tallest dams.
stalled. • The project aligns with the Mahakali (1996), outlining provisions
• PMP is a joint project between India and Nepal, primarily focused for the integrated development of the Mahakali River basin.
on energy production and irrigation enhancement. • Treaty aimed at the integrated development of the Mahakali River,
• It entails building a 315-meter high dam across the River Ma- including projects like the Sarada Barrage, Tanakpur Barrage,
hakali (Sarada in India), creating an 80 km long reservoir with and Pancheshwar Project.
a surface area of 116 km square and a total gross storage volume The Hindu
of about 11.35 billion cubic meters.

9.6.4 Bhu-Neer Portal

• L aunched digitally by Minister of Jal Shakti during India Water practices.
Week 2024. • P ortal is live for queries, tracking, and payments.
• A centralized platform for managing groundwater withdrawal • A ccessible to both project proponents and the general public for
permits. groundwater services.
• Developed by CGWA and NIC to regulate groundwater use across • C GWA regulates groundwater development and management in
India, ensuring transparency and sustainability. India, constituted under the Environment (Protection) Act, 1986.
• User-friendly interface with PAN-based single ID, NOC with QR • Issues advisories, public notices, and grants No Objection Cer-
code, and simplified processes. tificates for groundwater withdrawal.
• Improved version compared to its predecessor, NOCAP. CD
• Ensures groundwater compliance and promotes sustainable

9.7 River Interlinking

9.7.1 Modified Parbati-Kalisindh-Chambal (PKC) Link Project crore people in Rajasthan.
• The PKC-ERCP is an inter-state river linking initiative integrating the • W
 ater Supply: Provides a sustainable source of drinking and
original Parbati-Kalisindh-Chambal (PKC) project with the Eastern industrial water to water-scarce regions.
Rajasthan Canal Project (ERCP). • R
 egional Development: Promotes socio-economic growth in both
• A Memorandum of Understanding (MoU) was signed between the Rajasthan and Madhya Pradesh.
Central Government, Rajasthan, and Madhya Pradesh to implement Environmental Concerns:
this project under India’s National Perspective Plan for interlinking • R
 anthambore Tiger Reserve: The project may impact the reserve
rivers. by submerging approximately 37 sq km, potentially disrupting wild-
Key Components: life habitats and movement corridors.
• Integration: Combines the PKC river link project with the ERCP to • B
 iodiversity: Possible adverse effects on local flora and fauna due
form a comprehensive inter-state river linking project. to habitat alteration.
• Water Transfer: Aims to channel surplus water from the Chambal Implementation Status:
River basin to 23 districts in Rajasthan for irrigation, drinking, and • T
 he MoU signifies a collaborative effort between the Centre and
industrial purposes. the states to address water scarcity and promote sustainable
Benefits: development through river interlinking.
• Irrigation: Enhances irrigation facilities, potentially benefiting 3.45 The Indian Express

9.8 Coastal Zones Management and Regulations

9.8.1 National Coastal Mission Scheme (NCM)
• M oEFCC has expanded the National Coastal Mission Scheme tems.
(NCM) to address rising sea levels. • P romotion of sustainable livelihoods for coastal communities
• Aims to address climate change impacts on coastal areas and through skill development and capacity building.
ensure sustainable development. • I mproving resilience of coastal communities and infrastructure
• Launched in July 2014; Part of India’s National Action Plan on to climate change impacts.
Climate Change (NAPCC). CD
• Construction and maintenance of coastal protection infra-
structure to prevent erosion and manage disasters.
• Restoration of mangroves, coral reefs, and critical coastal ecosys-

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9.9 Telecom and Postal Sector – Spectrum Allocation, Call Drops, Predatory Pricing, etc
9.9.1 Chakshu and Digital Intelligence Platform (DIP)
• D oT has launched two initiatives to combat spam and fraud further.
calls via the Sanchar Saathi portal. • D igital Intelligence Platform (DIP) is a secure and integrated plat-
• Chakshu, meaning “eyes,” is accessible at sancharsaathi.gov.in/ form devised by the DoT to tackle the misuse of telecom resources
sfc, empowering citizens to report suspicious communications. and data.
• Users can report various types of fraud, including those related • It fosters intelligence sharing and information exchange among
to bank accounts, payment wallets, SIM cards, gas and electricity stakeholders, including telecom service providers, law enforce-
connections, KYC updates, impersonation, and sextortion. ment agencies (LEAs), banks, and financial institutions.
• The primary goal of Chakshu is to facilitate proactive reporting • T he DIP serves as a non-public data-sharing resource for various
of suspicious activities, aiding in the prevention and mitigation of entities such as TSPs, LEAs, banks, financial institutions, social
telecom-related fraud and spam calls. media platforms, and identity document issuing authorities.
• Telecom Regulatory Authority of India (TRAI) is developing an The Hindu
app for the Chakshu platform to streamline the reporting process

9.9.2 Direct-to-Mobile (D2M) Broadcasting

• D
 irect-to-Mobile (D2M) is an innovative technology that enables Challenges in Implementing D2M in India:
the transmission of video and multimedia content directly to mo- 1. S
 martphone Compatibility:
bile devices using terrestrial digital TV signals, bypassing internet- • Most existing smartphones lack hardware to receive terrestrial
based delivery systems. digital signals.
• It combines broadcasting and telecommunications, offering • Developing a new ecosystem of D2M-compatible handsets is
high-quality content without consuming mobile data or requiring an essential.
active internet connection. 2. I nfrastructure Requirements:
• Potential applications: • A nationwide network for terrestrial broadcasting with strong
• News and entertainment broadcasting directly on mobile indoor coverage needs to be built.
phones. • This infrastructure development will require significant invest-
• Emergency alerts and disaster management communication. ment and time.
• Education through direct multimedia streaming in remote 3. S pectrum Allocation Issues:
areas. • Balancing spectrum allocation between telecom operators and
Key Benefits of D2M Technology: broadcasters is a key challenge.
1. D ata Cost Reduction: • Telecom operators fear revenue loss as D2M might divert users
• Reduces dependency on internet-based streaming, lowering from mobile data services.
data consumption for users. 4. S takeholder Concerns:
2. E  fficient Spectrum Usage: • The Cellular Operators Association of India (COAI) has
• Utilizes broadcasting spectrum for multimedia delivery, reduc- raised concerns about market fairness if D2M services bypass
ing network congestion for telecom operators. telecom operators.
3. R  ural Outreach: • Ensuring transparency in spectrum allocation and revenue
• P rovides high-quality multimedia services in rural and remote models is critical.
areas with limited internet connectivity. 5. C ommercial Viability:
4. D  isaster Management: • The success of D2M depends on creating a sustainable busi-
• E nables real-time broadcasting of emergency alerts to mobile ness model and ensuring consumer adoption.
devices. CD

9.9.3 Kochi-Lakshadweep Islands Submarine Optical Fiber Connection (KLI-SOFC) Project

The Kochi-Lakshadweep Islands Submarine Optical Fibre • B enefits: The project aims to improve e-governance, tourism,
Connection (KLI-SOFC) Project is a significant initiative aimed education, health, commerce, and industries, thereby enhancing
at enhancing communication infrastructure in the Lakshadweep the standard of living and accelerating socio-economic
Islands. Key points include: development in the region.
• Inauguration: Prime Minister Narendra Modi inaugurated the proj- • I mplementation: Executed by Bharat Sanchar Nigam Limited
ect on January 3, 2024, in Kavaratti, Lakshadweep. (BSNL), with the contract awarded to M/s NEC Corporation India
• Objective: To provide high-speed internet connectivity to 11 islands, Pvt Ltd through a global open tendering process.
linking them to the mainland via submarine optical fibre cables. • F unding: Financed through the Universal Service Obligation Fund
• Coverage: The islands connected are Kavaratti, Agatti, Amini, (USOF) under the Department of Telecommunications.
Kadmat, Chetlet, Kalpeni, Minicoy, Androth, Kiltan, Bangaram, and • S trategic Importance: The project plays a significant role in
Bitra, covering a total distance of 1,868 kilometers. achieving the objectives of ‹Digital India› and the ‹National
• Cost: The project was implemented at a cost of ₹1,072 crore, Broadband Mission› by rolling out various e-governance projects in
excluding taxes. the Lakshadweep Islands. CD

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9.10 Electric and Hybrid Cars – FAME, National Electric Mobility Mission, etc.
9.10.1 PM E-Drive Scheme
• C entre approved the PM Electric Drive Revolution in Innovative • A adhaar-authenticated e-vouchers for EV buyers, signed by both
Vehicle Enhancement (PM E-DRIVE) Scheme with a ₹10,900 buyer and dealer to claim incentives.
crore outlay over 2 years. • ₹ 4,391 crore for procuring 14,028 e-buses in 9 major cit-
• Promotes electric mobility, reduces pollution, and enhances fuel ies including Delhi, Mumbai, and Bangalore.
security. • ₹2,000 crore for setting up 72,300 public EV charging stations,
• Aims to reduce range anxiety by improving charging infrastructure including fast chargers for e-4Ws, e-buses, e-2Ws, and e-3Ws.
in cities and highways. • ₹500 crore tied to scrapping certificates from MoRTH-approved
• Direct subsidies for e-2Ws, e-3Ws, e-buses, e-ambulances, and scrapping centers.
e-trucks. • ₹780 crore allocated for upgrading MHI’s test agencies for green
• ₹3,679 crore for demand incentives for e-2Ws, e-3Ws, e-ambu- mobility technologies.
lances, and e-trucks. HT

9.11 Digital India Initiatives

9.11.1 DigiReady Certification
• Q CI and ONDC launched DigiReady Certification (DRC) portal.
• Assess and certify digital readiness of Micro, Small, and Medium
Enterprises (MSMEs).
• MSMEs use online tools to evaluate readiness for the ONDC plat-
form, enhancing digital capabilities.
• Portal ensures smooth integration into digitized workflows for
MSMEs and small retailers.
• Assesses various aspects like documentation, technology profi-
ciency, workflow integration, order, and catalogue management.
• Offers business prospects for sellers, making them integral to the
digital ecosystem.
• Quality Council of India (QCI) founded in 1997 jointly by DPIIT,
Ministry of Commerce & Industry, and Indian industry.
• Registered as a non-profit organization under Societies
Registration Act XXI of 1860.
• Managed by constituent Boards like NABCB and NABL.
• QCI has 38 members, equally representing government, industry,
and consumers.
• Chairman appointed by PM based on industry recommendations.
Top of Form
CD

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10. ENERGY AND RESOURCES
Prelims PYQs
[UPSC CSE 2004] Consider the following statements: [UPSC CSE 2016] Recently, which of the following States has
1. National Thermal Power Corporation has diversified into the explored the possibility of constructing an artificial inland port to be
hydropower sector. connected to sea by a long navigational channel?
2. Power Grid Corporation of India has diversified into the telecom (a) Andhra Pradesh
sector. (b) Chhattisgarh
Which of the statements given above is/are correct? (c) Karnataka
(a) 1 only (d) Rajasthan
(b) 2 only
(c) Both 1 and 2 [UPSC CSE 2022] Consider the following statements:
(d) Neither 1 nor 2 1. G
 ujarat has the largest solar park in India.
2. K erala has a fully solar-powered International Airport.
[UPSC CSE 2004] Consider the following statements: 3. Goa has the largest floating solar photovoltaic project in India.
1. The Oil Pool Account of Government of India was dismantled with Which of the statements given above is/are correct?
effect from 1-4-2002. (a) 1 and 2
2. Subsidies on PDS kerosene and domestic LPG are borne by the (b) 2 only
Consolidated Fund of India. (c) 1 and 3
3. A n expert committee headed by Dr. R.A. Mashelkar to formulate (d) 3 only
a national auto fuel policy recommended that Bharat Stage-II
Emission Norms should be applied throughout the country by 1
April, 2004.
Which of these statements given above are correct?
(a) 1 and 2
(b) 2 and 3
(c) 1 and 3
(d) 1, 2 and 3

[UPSC CSE 2006] Consider the following statements:

1. Appellate Tribunal for Electricity has been established by each State
Government in India.
2. One component of the APDRP is the upgradation of sub-
transmission and distribution system for electricity in India.
Which of the statements given above is/are correct?
(a) 1 only
(b) 2 only
(c) Both 1 and 2
(d) Neither 1 nor 2

10.1 Renewable Energy – Wind, Solar, Tidal, Geothermal, etc.

10.1.1 VGF Scheme for Offshore Wind Energy Projects
• T he Union Cabinet approved the VGF scheme to support offshore faster project execution.
wind energy projects. • S upports critical infrastructure sectors like transportation,
• Offshore wind energy projects are wind farms developed in coast- energy, and public utilities.
al waters or oceans. • V GF Scheme for Offshore Project aligns with National Offshore
• Viability Gap Funding (VGF) Scheme: Financial tool launched Wind Energy Policy (2015) to harness India’s offshore wind
in 2004 to bridge economic viability gaps in infrastructure potential.
projects. • A ims to reduce power costs, making offshore wind projects viable
• Administered by the Ministry of Finance, it provides capital for DISCOMs with government support.
subsidies to make projects financially attractive for private sector • T argets 1 GW capacity installation (500 MW each in Gujarat and
investment. Tamil Nadu).
• Grants to cover part of project costs that are economically • P rivate developers execute projects through transparent bidding.
unviable for private investors. • P ower Grid Corporation of India Ltd (PGCIL) to build power
• Projects selected through competitive bidding, projects must evacuation infrastructure.
justify economic viability but face financial feasibility challenges. • 7 453 crore, including Rs. 6853 crore for installing and commission-
• Grants disbursed during project construction, contingent on ing 1 GW projects in Gujarat and Tamil Nadu.
private sector equity contribution. • P rojects to generate 3.72 billion units annually, reducing CO2
• Funds from the government budget with potential contributions emissions by 2.98 million tons/year over 25 years.
from project-owning entities. • E xpected to kickstart India’s 37 GW offshore wind sector, with
• Additional financial assistance capped at 20% of total project cost. Rs. 4,50,000 crore investments, fostering ocean-based economic
• Mitigates financial risks, spurring private sector participation for activities and supporting energy transition goals. CD

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10.2 Solar Energy – JNNSM, Solar Cities, Solar Pumps, etc.
10.2.1 PM Surya Ghar Muft Bijli Yojana
• L aunched on February 15, 2024, by Prime Minister Narendra • S ubsidy varies based on monthly electricity consumption:
Modi. • 0-150 units: ₹30,000 to ₹60,000 for a 1-2 kW system.
• Aims to transform India’s energy landscape by providing free • 150-300 units: ₹60,000 to ₹78,000 for a 2-3 kW system.
electricity to 1 crore households through subsidized rooftop solar • Above 300 units: ₹78,000 for systems above 3 kW.
systems. • C ollateral-Free Loans: Low-interest loans (7%) available for
• Free Electricity: Subsidized rooftop solar panels ensure significant systems up to 3 kW.
savings on electricity bills. • S olar Capacity Expansion: Expected to add 30 GW of solar
• Government Savings: Reduces electricity costs for the capacity through residential installations.
government by an estimated ₹75,000 crore annually. • E nvironmental Benefits: Will generate 1000 BUs of electricity,
• Environmental Impact: Helps reduce carbon emissions, contrib- reducing 720 million tonnes of CO2 emissions over 25 years.
uting to a sustainable energy mix. • J ob Creation: Anticipated to create 17 lakh direct jobs in
• Renewable Energy Adoption: Promotes the use of solar power, manufacturing, logistics, installation, and maintenance.
fostering energy independence. Live Mint

10.2.2 Model Solar Village

• M NRE issued guidelines for ‘Model Solar Village’ under PM-Surya crore grant.
Ghar Muft Bijli Yojana. • S
 tate/UT Renewable Energy Development Agencies will
• Aims to establish one Model Solar Village per district in India. implement the scheme under DLC supervision.
• ₹800 crore allocated, with ₹1 crore per Model Solar Village. • P
 M-Surya Ghar Muft Bijli Yojana provides 300 units of free elec-
• Villages must be revenue villages with over 5,000 people (or tricity per month, with a ₹75,000 crore investment.
2,000 in special category states) to qualify.  ims to light up 1 crore households.
• A
• Villages compete based on installed renewable energy capac- • U
 rban Local Bodies and Panchayats will be incentivized to
ity 6 months after being named a candidate by the District Level promote rooftop solar systems.
Committee (DLC). CD
• The village with the highest RE capacity in each district gets a ₹1

10.2.3 India is now 3rd-Largest Producer of Solar Power

• S urpassing Japan, India generated 113 billion units (BU) of solar  espite significant capacity, solar power constitutes only 6.66%
• D
power, showcasing its increasing prominence. of India’s total electricity production, underlining a disparity
• China remains the top global producer, generating 584 BU in between capacity and output.
2024, with the United States, Japan, Germany, and India following.  lobally, renewables, including solar and wind, contributed 30% to
• G
• India ranks fifth globally in installed solar capacity, boasting 73 electricity production in 2023, with China leading the charge.
gigawatts (GW) of solar power.
• Solar generation surged globally, increasing 6x from 2015, with The Hindu
India experiencing a seventeen-fold rise during the same period.

10.3 Biofuel Policy

10.3.1 Sustainable Aviation Fuel (SAF)
• A irbus and the CSIR-Indian Institute of Petroleum (CSIR-  ll Airbus aircraft are currently certified to operate with a 50% SAF
• A
IIP) have signed a Memorandum of Understanding (MoU) to blend, with a goal to achieve 100% SAF compatibility by 2030.
collaborate on the development and testing of indigenous Sus- • C
 SIR-IIP will study fuel properties under the new pathway and
tainable Aviation Fuel (SAF) in India. assess the impact on aircraft systems and the environment, while
• This partnership aims to support the decarbonisation efforts of Airbus will provide guidance on the fuel evaluation process, sharing
India›s aerospace industry by focusing on SAF production and expertise in fuel testing and aircraft systems.
commercialisation using a new Hydroprocessed Esters and  irbus India and South Asia President and MD, Remi Maillard, stat-
• A
Fatty Acids (HEFA) technology pathway and locally sourced ed that India has the potential to become a global SAF production
feedstocks. hub by leveraging feedstock availability, local talent, technological
• Both entities will work together on technical assessment, approv- expertise, and the ability to scale up solutions.
als, market access, and sustainability accreditation for SAF The Hindu
production.

10.3.2 BioE3 Policy

 he Union Cabinet approved the ‘BioE3 (Biotechnology for Econ-
• T bioeconomy.
omy, Environment and Employment) Policy. • O
 bjectives: Encourages R&D, entrepreneurship, and biomanufac-
• Focuses on bio-based products production across sectors, turing hubs.
aligning with goals like ‘Net Zero’ carbon and promoting a circular  ims to expand India’s biotechnology workforce, support region-
• A

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 al growth, and promote sustainable practices. enhance India’s competitiveness.
• T he policy aligns with LiFE program and promotes regenerative • C
 ore Themes: Bio-Based Chemicals; Functional Foods; Precision
bioeconomy models. Biotherapeutics; Climate-Resilient Agriculture; Carbon Capture;
• Targets job creation in tier-II and tier-III cities through biomanu- Marine and Space Research.
facturing hubs using local biomass. CD
• Ensures ethical biosafety and global regulatory alignment to

10.4 Green Hydrogen

10.4.1 SIGHT Program for Green Hydrogen Transition
The Strategic Interventions for Green Hydrogen Transition production capacity.
(SIGHT) Programme is a key component of India›s National Green • E xecution Agencies: The scheme is implemented by agencies
Hydrogen Mission, aiming to promote the production and utilization nominated by the Ministry of Petroleum and Natural Gas (Mo-
of green hydrogen. PNG), primarily oil and gas companies, with the Centre for High
• Financial Allocation: The programme has an outlay of ₹17,490 Technology (CHT) providing support.
crore, with ₹4,440 crore allocated for domestic electrolyser • M onitoring Mechanism: A committee co-chaired by the
manufacturing and ₹13,050 crore for green hydrogen production. secretaries of MoPNG and MNRE, along with other experts, will
• Implementation Strategy: The scheme employs a competitive periodically review the implementation and performance of the
bidding process to select producers offering the lowest cost for awarded capacities.
green hydrogen and its derivatives, facilitating cost reduction and • I ndustry Participation: Companies like Indian Oil Corpora-
rapid expansion. tion plan to convert 50% of their grey hydrogen to green hydrogen
• Incentive Structure: Producers receive direct incentives over three by 2030, establishing green hydrogen plants in all refineries.
years from the start of production: Similarly, Hindustan Petroleum Corporation is constructing a 370
• ₹50 per kg in the first year TPA green hydrogen plant at its Visakhapatnam refinery.
• ₹40 per kg in the second year This initiative underscores India’s commitment to sustainable energy
• ₹30 per kg in the third year and reducing carbon emissions through the adoption of green hydro-
• Eligibility Criteria: Bidders must meet the ‹National Green gen technologies.
Hydrogen Standard› as notified by MNRE and demonstrate a net Down to Earth
worth of at least ₹15 crore per 1,000 MT per annum of quoted

10.4.2 Green Ammonia Production under SIGHT Program

• S olar Energy Corporation of India (SECI) initiates bidding for mission guidelines.
5.39 lakh MT per annum of Green Ammonia production under Mode • T he mission targets 5 MMT green hydrogen production and 125
2A of SIGHT Programme. GW renewable energy capacity by 2030.
• Green ammonia, produced using renewable energy, aims for • Investment of ₹8 lakh crore and creation of over 6 lakh jobs
sustainable, emission-free applications in various sectors. • Aims to reduce fossil fuel imports by ₹1 lakh crore and cut 50 MMT
• Produced by combining nitrogen and hydrogen via water elec- GHGs emissions annually by 2030.
trolysis using renewable energy. • Green Hydrogen Transition Programme (SIGHT) offers financial
• National Green Hydrogen Mission launched in January 2023 to incentives for electrolyser manufacturing and green hydrogen
make India a global hub for green hydrogen. production.
• Earlier, the National Hydrogen Mission (August 2021) aimed at • Plans to evolve incentive schemes based on market and
cutting carbon emissions and boosting renewable energy use. technology developments.
• The Ministry of New and Renewable Energy (MNRE) formulates CD

10.4.3 International Partnership for Hydrogen and Fuel Cells in the Economy (IPHE)
• T he 41st Steering Committee Meeting of IPHE is currently States, Japan, Germany, China, and India, among others.
underway in New Delhi. • In partnership with the Hydrogen Council, IPHE announced the
• Fuel cells are electrochemical devices that convert chemical launch of the H2-DEIA platform in 2023.
energy into electricity. • T his platform is specifically dedicated to advancing diversity,
• They offer exceptionally high efficiency and produce zero harmful equity, inclusion, and accessibility within the hydrogen and fuel
emissions. cell economy.
• Fuel cells are widely regarded as the “battery of the future” due to • Its primary objectives include fostering a diverse workforce,
their innovative technology. sharing best practices, and supporting workforce development
• These cells operate based on electrochemical reac- initiatives in the hydrogen sector.
tions occurring between fuel and oxygen. CD
• Established in 2003, IPHE is an international inter-governmen-
tal partnership led by the United States.
• Its primary objective is to accelerate the progress of hydrogen and
fuel cell technologies
• The partnership comprises 21 member countries as well as the
European Commission, although the latter holds a non-voting
status.
• Member countries include major economies such as the United

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10.4.4 Vijaipur Green Hydrogen Plant in Madhya Pradesh
• G AIL (India) Ltd commissions its first green hydrogen plant at  onducting experimental blending with natural gas.
• C
Vijaipur, Madhya Pradesh.  urrent regulations allow up to 5% hydrogen blending.
• C
• Aligns with National Green Hydrogen Mission’s goal of 5 million  reen Hydrogen: Produced through electrolysis with renewable
• G
tons annual production by 2030. electricity.
• Features 10 MW proton exchange membrane electrolyser from • N
 o direct CO2 or greenhouse gas emissions.
Canada.  reen Hydrogen Standard: Defines green hydrogen with emissions
• G
• Produces about 3 tonnes of green hydrogen daily with 99.999% not exceeding 2 kg CO2 equivalent per kg.
purity. • B
 ureau of Energy Efficiency (BEE), Ministry of Power, over-
• Production uses renewable electricity, like solar energy, for water sees green hydrogen projects.
splitting; Major Objective: Hydrogen Blending. The Hindu

10.4.5 India’s First Hydrogen Fuel Cell Ferry

• R ecently PM flagged off India’s first indigenously built hydrogen fuel fuels for 50 per cent of inland waterways-based passenger fleets
cell ferry boat virtually. in the next one decade, and 100 per cent by 2045.
• The vessel was launched under the Harit Nauka initiative (Jan  his is to reduce GHG emissions as per the Maritime Amrit Kaal
• T
2024). Vision 2047.
• Under this, the Shipping Ministry unveiled the guidelines for • O
 . Chidambaranar Port is designated as the first Green Hydro-
inland vessels. gen Hub Port of the country.
• As per the guidelines, all states have to make efforts to use green The Indian Express

10.5 Coal and Mining Sector

10.5.1 Coal Controller’s Organisation (CCO)
 oal Controller’s Organisation (CCO) conducts coal mine inspec-
• C enforcement.
tions for accuracy.  rades of Coal in India: Non-Coking Coal: Based on Gross
• G
• One of 8 core sectors contributing to India’s economic Calorific Value (GCV); Coking Coal: Based on Ash Content; Semi
development. Coking/Weakly Coking Coal: Based on Ash plus Moisture Con-
• Four coal grades: Lignite, Bituminous, Sub-Bituminous, Anthracite. tent.
• Over 70% reserves in the South-Central region: Orissa, Chhat- • C
 oke: Solid carbonaceous material derived from heating coal
tisgarh, Jharkhand; 2nd-largest producer of Anthracite globally without air.
after China. • P
 orous, hard, black substance with high carbon content.
• The mining sector contributes over 2% to total GDP; India has • U
 sed as fuel and reducing agent in iron ore smelting for steel
a 9% global share of coal production. production.
• Coal share in major imports estimated at 8% in FY 2023. • N
 on-Coking Coal: Used for power generation and industrial
• India exports coking coal to Nepal, Bangladesh, Bhutan. applications.
• About Coal Controller’s Organisation (CCO): Established in 1975 • C
 oking Coal: Possesses properties for conversion into coke.
under Coal Mines Act, 1974, under Ministry of Coal. • S
 emi Coking/Weakly Coking Coal: Intermediate properties
• Headquarters in Kolkata, field offices in various locations. between non-coking and coking coal.
• Functions of CCO: Regulatory oversight, inspections, quality CD
control, grading, licensing; Data collection, research, conservation,

10.5.2 Grade of Coal in India

• A dani Group allegedly claimed ‘low grade’ Indonesian coal as • G ondwana coal constitutes 99% of India’s production, with top
‘high quality’ to Tamil Nadu’s TANGEDCO, inflating its value. reserves in Jharkhand, Odisha, Chhattisgarh, West Bengal, and
• Coal gradation in India varies based on Gross Calorific Value Madhya Pradesh.
(GCV), indicating energy potential: (1) High-Grade (GCV > 7,000 • C oal types in India include Anthracite (80-95% carbon), Bitumi-
kcal/kg); (2) Low-Grade (GCV 2,200-2,500 kcal/kg). nous (60-80% carbon), and Lignite (40-55% carbon).
• India categorizes coal into 17 grades according to the Coal Ministry. • India produced 997 million tonnes of coal in FY 2023-24, mainly
• Indian coal historically has high ash content and low calorific from Coal India Ltd, with 58 million tonnes of coking coal.
value compared to imports, leading to increased emissions. • R enewable energy constituted 71.5% of India’s 13.6 GW capaci-
• Coal washing reduces ash and moisture, enhancing energy ty addition in Q1 2024, reducing reliance on coal.
efficiency and reducing environmental impact. • F rom April 2023 to January 2024, coal imports’ share in India de-
• Coal gasification converts coal into syngas via IGCC, improving creased to 21%, with a 36.69% reduction for blending by thermal
efficiency and reducing emissions. plants and a 94.21% increase for coal-based power plants.
• India holds the world’s fourth-largest coal reserves, totaling 2 The Hindu
billion tonnes.
• Coal reserves are primarily in Gondwana Formations (Peninsular
India, 250 million years old) and Tertiary Formations (North-East-
ern region, 15-60 million years old).

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10.5.3 District Mineral Foundation (DMF)
• D MF is a non-profit trust set up under the MMDR Amendment  bjectives: Implement welfare projects, mitigate mining impacts,
• O
Act, 2015. and ensure sustainable livelihoods.
• Purpose: To benefit people and areas impacted by mining, as • M
 anaged by DMFs in mining-affected districts, funded through
determined by the State Government. miner contributions.
• Funding: Contributions from mineral concession holders, as per • M
 iners contribute 30% of royalty for leases before 12th January
Central or State Government decisions. 2015 and 10% for leases after.
• Operates under the State Government, with funds collected at • 6
 0% of funds must go to high-priority areas like drinking water,
the district level. healthcare, education, and environmental preservation.
• Pradhan Mantri Khanij Kshetra Kalyan Yojana (PMKK- • 4
 0% can be used for infrastructure, irrigation, energy, and water-
KY): Launched in 2015 by the Ministry of Mines for the welfare of shed development.
mining-affected areas using DMF funds. The Hindu

10.6 Oil and Gas Sector – HELP, Open Acreage Policy, etc.
10.6.1 India’s First Oil Production in K-G Basin
• F irst Oil Production: Oil and Natural Gas Corporation (ONGC) production by 15%.
commenced its first oil production from the deep-water KG-DWN • T
 echnical Challenges and Solutions: Due to the waxy nature
98/2 block in the Krishna-Godavari (KG) basin off the Bay of of the crude oil, ONGC faced several technical challenges, which
Bengal near the Kakinada coast on January 7, 2024. were addressed by adopting Pipe-In-Pipe technology.
• Location: The KG-DWN 98/2 block is situated approximately 25 • M
 ake in India Initiative: While subsea hardware was sourced
km from the coastline. internationally to meet specific technical requirements, a significant
• Peak Production Estimates: The field is expected to achieve portion of the fabrication work was conducted at the Modular Fab-
a peak production of around 45,000 barrels of oil per day and rication Facility in Kattupalli, Tamil Nadu, aligning with the Make
over 10 Million Metric Standard Cubic Metres per Day (MMSC- in India initiative.
MD) of gas. • F
 uture Plans: Efforts are underway to commence production of the
• Impact on ONGC’s Output: This development is projected to remaining oil and natural gas from the 98/2 block by mid-2024.
increase ONGC›s total oil production by 11% and natural gas The Hindu

10.7 Nuclear Energy

10.7.1 Nuclear Wastes
• India achieves a milestone with loading the Prototype Fast • M anaging spent fuel poses challenges due to heat and radioac-
Breeder Reactor (PFBR) core, advancing the nuclear program. tivity.
• Stage III aims to utilize thorium reserves for power generation. • Secure storage essential to prevent leakage and contamination.
• PFBR, 500 MWe fast-breeder reactor, under construction in • IPFM’s 2015 report notes India’s reprocessing plants in Trombay,
Kalpakkam. Tarapur, Kalpakkam.
• Fueled by Mixed Oxide (MOX) Fuel to extend nuclear fuel supply. • P lants reprocess fuel for stage II reactors and weapons.
• Nuclear waste, highly radioactive, generated from spent fuel. • T arapur and Kalpakkam facilities operate at 15% combined
• Example: U-235 fissions to barium-144, krypton-89, and neutrons. • T rombay processes 50 tHM/y, Tarapur and Kalpakkam each 100
• Non-fissile debris becomes nuclear waste. tHM/y.Top of Form
• The US produces 69,682 tonnes (tn), Canada 54,000 tn, and The Hindu
Russia 21,362 tn.

10.8 Policy Wise: Power Sector

10.8.1 Central Electricity Regulatory Commission (CERC)
• India’s power regulator, CERC, appointed a Single Member • F
 unctions of CERC:
Bench to address issues from a sudden rise in power demand. • Regulates tariffs of Central Government-owned generating
• CERC is a statutory body established under the Electricity Regu- companies.
latory Commissions Act, 1998. • Oversees tariffs for other generating companies with in-
• It functions as the Central Commission under the Electricity Act, ter-State electricity projects.
2003, which replaced the ERC Act. • Sets tariffs for inter-State transmission.
• Composition: Chairperson, 4 members, and the Central Electrici- • Issues licenses for inter-State electricity transmission and
ty Authority Chairperson as an ex-officio member. trading.
• CERC promotes competition, efficiency, and economy in bulk The Hindu
power markets, improves supply quality, attracts investments/
• Advises the government on institutional reforms to balance
demand and supply, benefiting consumers.

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10.8.2 International Energy Agency (IEA):
• IEA forecasts robust growth in India’s oil demand.
• Driven by industrial expansion and increasing mobility.
• IEA is an Autonomous inter-governmental organization
within OECD framework.
• Shapes a secure and sustainable energy future for all.
• Established in 1974 to ensure oil supply security.
• Response to 1973-1974 oil crisis highlighting dependency
vulnerability.
• Comprises 31 member countries and eleven association countries.
• The candidate country must be an OECD member.
• India joined in 2017 as an Associate member.
• Reports published by IEA: World Energy Outlook, World Energy
Balances, Energy Technology Perspectives, World Energy Statistics
and Net Zero by 2050
• Membership Criteria: 90 days of previous year’s net oil imports in
reserves.
• Demand restraint program to reduce oil consumption by up to
10%.
• Legislation for CERM (Co-ordinated Emergency Response
Measures).
• Legislation for oil company reporting.
• Capability to contribute to IEA collective action.
The Indian Express

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11. AGRICULTURE AND ALLIED SECTORS
Prelims PYQs
[UPSC CSE 2009] Consider the following statements: [UPSC CSE 2011] The lower Gangetic plain is characterized by a
1. The Commission for Agricultural Costs and Prices recommends the humid climate with high temperature throughout the year.
Minimum Support Prices for 32 crops. Which one among the following pairs of crops is most suitable for this
2. The Union Ministry of Consumer Affairs, Food and Public region?
Distribution has launched the National Food Security Mission. (a) Paddy and Cotton
Which of the statements given above is/are correct? (b) Wheat and Jute
(a) 1 only (c) Paddy and Jute
(b) 2 only (d) Wheat and Cotton
(c) Both 1 and 2
(d) Neither 1 nor 2 [UPSC CSE 2012] Consider the following crops of India:
1. Groundnut
[UPSC CSE 2010] Consider the following statements: 2. Sesamum
1. The Union Government fixes the Statutory Minimum Price of 3. Pearl millet
sugarcane for each sugar season. Which of the above is/are predominantly rainfed crop/crops?
2. Sugar and sugarcane are essential commodities under the (a) 1 and 2 only
Essential Commodities Act. (b) 2 and 3 only
Which of the statements given above is/are correct? (c) 3 only
(a) 1 only (d) 1, 2 and 3
(b) 2 only
(c) Both 1 and 2 [UPSC CSE 2013] Consider the following crops:
(d) Neither 1 nor 2 1. Cotton
2. Groundnut
[UPSC CSE 2010] Though coffee and tea both are cultivated on 3. Rice
hill slopes, there is some difference between them regarding their 4. Wheat
cultivation. Which of these are Kharif crops?
Consider the following statements: (a) 1 and 4
1. Coffee plant requires a hot and humid climate of tropical areas, (b) 2 and 3 only
whereas tea can be cultivated in both tropical and subtropical (c) 1, 2 and 3
areas. (d) 2, 3 and 4
2. Coffee is propagated by seeds, but tea is propagated by stem
cuttings only. [UPSC CSE 2014] Consider the following statements:
Which of the statements given above is/are correct? 1. M
 aize can be used for the production of starch.
(a) 1 only 2. O il extracted from maize can be a feedstock for biodiesel.
(b) 2 only 3. Alcoholic beverages can be produced by using maize.
(c) Both 1 and 2 Which of the statements given above is/are correct?
(d) Neither 1 nor 2 (a) 1 only
(b) 1 and 2 only
[UPSC CSE 2010] Following are the characteristics of an area in (c) 2 and 3 only
India: (d) 1, 2 and 3
1. Hot and humid climate
2 .Annual rainfall 200 cm [UPSC CSE 2014] In India, cluster bean (Guar) is traditionally used
3. H ill slopes up to an altitude of 1100 metres as a vegetable or animal feed, but recently the cultivation of this has
4. A nnual range of temperature 15°C to 30°C assumed significance.
Which one among the following crops are you most likely to find in Which one of the following statements is correct in this context?
the area described above? (a) The oil extracted from seeds is used in the manufacture of
(a) Mustard biodegradable plastics.
(b) Cotton (b) The gum made from its seeds is used in the extraction of shale
(c) Pepper gas.
(d) Virginia Tobacco (c) T
 he leaf extract of this plant has the properties of antihistamines.
(d) It is a source of high-quality biodiesel.

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[UPSC CSE 2014] Consider the following pairs: [UPSC CSE 2019] Among the agricultural commodities imported by
1. Kinnaur - Arecanut India, which one of the following accounts for the highest imports in
2. Mewat - Mango terms of value in the last five years?
3. Coromondal - Soyabean (a) Spices
Which of the above pairs is/are correctly matched? (b) Fresh fruits
(a) 1 and 2 only (c) Pulses
(b) 3 only (d) Vegetable oils
(c) 1, 2 and 3
(d) None of the above [UPSC CSE 2023] Consider the following statements:
1. The Government of India provides Minimum Support Price for niger
[UPSC CSE 2016] With reference to ‘Initiative for Nutritional (Guizotia abyssinica) seeds.
Security through Intensive Millets Promotion’, consider the following 2. Niger is cultivated as a Kharif crop.
statements: 3. Some tribal people in India use niger seed oil for cooking.
1. This initiative aims to demonstrate the improved production and How many of the above statements are correct?
post-harvest technologies and to demonstrate value addition (a) Only one
techniques, in an integrated manner, with a cluster approach. (b) Only two
2. Poor, small, marginal, and tribal farmers have a larger stake in this (c) All three
scheme. (d) None
3. An important objective of the scheme is to encourage farmers of
commercial crops to shift to millet cultivation by offering them free [UPSC CSE 2024] Which of the following countries are well known
kits of critical inputs of nutrients and micro irrigation equipment. as the two largest cocoa producers in the world?
Select the correct answer using the code given below: (a) Algeria and Morocco
(a) 1 only (b) Botswana and Namibia
(b) 2 and 3 only (c) Côte d’Ivoire and Ghana
(c) 1 and 2 only (d) Madagascar and Mozambique
(d) 1, 2 and 3

[UPSC CSE 2019] Among the following, which one is the largest
exporter of rice in the world in the last five years? (2019)
(a) China
(b) India
(c) Myanmar
(d) Vietnam

[UPSC CSE 2019] With reference to the cultivation of Kharif crops in

India in the last five years, consider the following statements:
1. Area under rice cultivation is the highest.
2. Area under the cultivation of jowar is more than that of oilseeds.
3. Area of cotton cultivation is more than that of sugarcane.
4. A rea under sugarcane cultivation has steadily decreased.
Which of the statements given above are correct?
(a) 1 and 3 only
(b) 2, 3 and 4 only
(c) 2 and 4 only
(d) 1, 2, 3 and 4

11.1 Agricultural Policies and Reforms

11.1.1 Spices Board of India
• S pices Board discussed with CODEX to address ethylene oxide • I ndia became a member in 1964.
(ETO) contamination • C ODEX Committee on Spices and Culinary Herbs
• Follows recalls of certain branded spices in Hong Kong and Singa- (CCSCH): Formed in 2013, hosted by India, with the Spices Board
pore due to ETO contamination. as the Secretariat.
• Concerns raised by the US, New Zealand, and Australia prompt • A ims to develop global standards for herbs and spices.
evaluations of Indian spice imports. • I ndia advocates for establishment of ETO limits, submits propos-
• Spices Board: Formed in 1987 under the Spices Board Act 1986, als for standardizing testing protocols.
merging Cardamom Board and Spices Export Promotion Council. • Intensifies efforts to prevent contamination, despite ETO’s car-
• International link between Indian exporters and importers cinogenic nature.
abroad, under the Ministry of Commerce & Industry. • Major producing states include Madhya Pradesh, Rajasthan,
• Headquarters in Kochi with regional laboratories across India. Gujarat, etc.
• Functions include promoting organic production, cardamom • Spice production is growing rapidly, with exports totaling $4.25
development, and post-harvest improvement programs for 52 billion in 2023-24.
scheduled spices. • Chili, cumin, turmeric, ginger, and coriander make up about 76%
• CODEX: Established in 1963 by FAO and WHO to protect of total production.
consumer health and ensure fair food trade practices. • Top export destinations: China, USA, Bangladesh, UAE, etc.
• Codex standards recognized as reference standards by WTO’s The Hindu
SPS Agreement.

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11.1.2 Kisan Credit Card (KCC) Fisheries Scheme
• T he Department of Fisheries inaugurated the integration of KCC-  ending rate under KCC scheme is 7%, including 2% interest
• L
FS with JanSamarth Portal, revolutionizing credit facilities for subvention by GoI, with an additional 3% incentive for prompt
fishers and fish farmers nationwide. repayment.
• JanSamarth is First-of-its-kind online platform connecting lend-  armers repaying promptly would effectively get a loan at 4%
• F
ers with beneficiaries. per annum for amounts up to Rs. 2 lakhs.
• Allows citizens to avail loans under 13 Central government  isan Credit Cards (KCC) Scheme: Introduced in 1998 on the
• K
schemes across 4 loan categories. recommendation of V. Gupta of NABARD to provide timely credit
• The KCC Fisheries Scheme was introduced in 2018-19 to extend support to farmers.
the KCC facility to fisheries and animal husbandry farmers.  imed at providing flexible and simplified credit for cultivation,
• A
• Bank authorities instructed to issue KCC within 14 days of purchasing inputs, post-harvest expenses, and allied activities.
receiving completed applications from fish farmers.  bjectives include: (1) Meet short-term credit requirements for
• O
• Existing KCC holders eligible for interest subvention and prompt cultivation and post-harvest expenses; (2) Provide working cap-
repayment incentive up to a credit limit of Rs. 3 lakhs, including ital for maintaining farm assets and allied activities, (3) Fulfill in-
fisheries activities. vestment credit requirements for agriculture-allied activities.
• New card holders have a credit limit of Rs. 2 lakhs for fisheries • Implemented by commercial banks, Regional Rural Banks
activities. (RRBs), Small Financial Banks, and Cooperative banks. CD

11.1.3 Agricultural Infrastructure Fund (AIF) Scheme

• C entre has expanded the Agricultural Infrastructure Fund (AIF) a maximum of 7 years.
scheme. • U p to 25 projects in different locations can be funded, each
• It now includes financial support for Farmers’ Producers Organi- eligible for a ₹2 crore loan.
zations (FPOs) to improve their financial security. • T he 25-project limit doesn’t apply to state agencies, coopera-
• AIF is a Central Sector Scheme launched in 2020 giving interest tives, FPOs, or SHGs.
subvention and financial support. • B orrowers must contribute at least 10% of project cost.
• Aims to provide medium- to long-term debt financ- • Moratorium for repayment ranges from 6 months to 2 years.
ing for post-harvest management and community farming • 24% of total grants-in-aid must support SC/ST entrepre-
assets. neurs (16% SC, 8% ST).
• The scheme runs from FY2020 to FY2032 (10 years). • P riority loans for women and weaker segments of society.
• Eligible entities: PACS, Marketing Cooperatives, FPOs, Farmers, • C redit guarantee available under the CGTMSE scheme for
SHGs, JLGs, Agri-entrepreneurs, Startups; State/Central agencies loans up to ₹2 crore.
or Local Body-sponsored PPP projects; PSUs are excluded unless • F POs can use credit guarantees from DACFW’s FPO promotion
under PPP. scheme.
• All loans up to ₹2 crore have a 3% annual interest subvention for The Hindu

11.1.4 Minimum Support Price (MSP)

• D emand for MSP legal backing is back again at Farmers Protest ply and demand, market trends, consumer impact, environmental
2.0. implications, and terms of trade.
• MSP is the government’s purchasing rate for crops, ensuring •  ACP projects three production cost types: A2, A2+FL, and C2,
C
farmers receive a minimum profit margin. covering various expenses and opportunity costs.
• It’s set at 1.5 times the cost of production incurred by farmers. •  SP recommendations are primarily based on A2+FL costs,
M
• MSP originated in response to food shortages in the 1960s, notably with C2 used as benchmark reference costs.
during the Bihar famine of 1966–1967. • C
 abinet Committee on Economic Affairs (CCEA) decides on
• Agricultural Price Commission (APC) was established in 1965 to MSP levels and other CACP recommendations.
implement price policies, later evolving into the Commission for • S
 waminathan Commission’s Recommendation: Recommended
Agricultural Costs and Prices (CACP) in 1985. MSP to be at least 50% more than C2 (weighted average Cost of
• CACP recommends MSPs for 22 crops and FRP for sugarcane. Production (CoP)).
• Mandated crops include 14 kharif, 6 rabi crops, and 2 commercial •  he government asserts MSP is at least 1.5 times A2+FL cost, not
T
crops, with additional ones based on rapeseed/mustard and copra C2 as recommended by the Swaminathan Commission.
prices. Down to Earth
• CACP considers various factors including cultivation costs, sup-

11.1.5 Price Stabilization Fund (PSF)

• T he government recently approved the inclusion of wheat and or procuring them.
rice in the PSF.  sed to regulate price volatility of commodities like onion,
• U
• PSF was established in 2014-15 under the Department of potatoes, and pulses.
Agriculture, Cooperation & Farmers Welfare (DAC&FW).  tilized for granting interest-free advance of working capital to
• U
• Transferred to the Department of Consumer Affairs (DOCA) in 2016. Central Agencies, State/UT Governments/Agencies.
• Centrally managed by Price Stabilisation Fund Management  ay support IMPORT along with domestic procurement.
• M
Committee (PSFMC).  SF scheme offers interest-free loans to cover working capital
• P
• Small Farmers Agribusiness Consortium (SFAC) maintains PSF and related expenses for procurement and distribution.
as a central corpus fund. Live Mint
• Aims to stabilize prices of selected commodities by distributing

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11.1.6 Cabinet approves continuation of PM-AASHA
• T he Union Cabinet approved the continuation of the PM-AASHA MSP.
scheme with a ₹35,000 crore budget for the 15th Finance Com- • P
 rice Deficiency Payment Scheme (PDPS): Covers oilseeds,
mission Cycle, ending in 2025-26. paying farmers the difference between MSP and market price;
• PM-AASHA schemes: Price Support System, Price Stabilization coverage expanded from 25% to 40% of state oilseed production.
Fund (PSF), Price Deficiency Payment Scheme (PDPS), and Market • M
 arket Intervention Scheme (MIS): Expanded coverage from
Intervention Scheme (MIS). 20% to 25% for perishable crops; offers direct payments to farmers
• Launched in 2018 to ensure farmers get fair prices for their instead of physical procurement; government covers transportation
produce. and storage for Tomato, Onion, and Potato (TOP) crops.
• Nodal Ministry: Ministry of Agriculture and Farmers Welfare. • E
 nsures fair prices above MSP for farmers.
• Key Components-> Price Support Scheme (PSS): Buys pulses, • B
 oosts the rural economy by increasing farmers’ income.
oilseeds, and copra directly from farmers. • E
 ncourages crop diversification, reducing soil and water stress.
• Price Stabilization Fund (PSF): Maintains buffer stock of pulses The Hindu
and onions to control price volatility, procures when prices exceed

11.1.7 National Agriculture Code (NAC)

• B IS is developing a NAC to standardize agriculture, similar to • S
 tructure:
building and electrical codes. • General principles for all crops.
• Standards for each stage in agriculture, including field prepa- • Crop-specific standards for key crops like paddy, wheat,
ration, crop choice, irrigation, harvesting, storage, and organic oilseeds, and pulses.
farming.  ill span the full agriculture cycle: crop selection, land prep,
• W
• Strategy involves working groups in 12-14 areas, with experts from sowing, irrigation, soil/plant health, harvesting, sustainability, and
universities and R&D. record-keeping.
• NAC will provide guidance for farmers, universities, and offi- • S
 tandards for inputs like fertilizers, pesticides, and crop stor-
cials, ensuring best practices and consistency. age, with emphasis on natural/organic farming and IoT in agricul-
• BIS currently has standards for machinery and inputs but lacks ture.
standardized practices for field prep, micro-irrigation, etc. The Indian Express

11.1.8 Statistical Report on Value of Output from Agriculture and Allied Sectors 2024
• R eport published by the NSO. • I tem-wise Value of Output: Cereals: Paddy and wheat top
• Crops are categorized into 12 groups including cereals, pulses, contributors, Uttar Pradesh leading in sugarcane.
oilseeds, and fruits & vegetables. • Pulses: Gram and Arhar dominant, Madhya Pradesh leads in pro-
• Livestock products categorized into 7 groups including milk, meat, duction.
and eggs. • Oilseeds: Groundnut and Rapeseed & Mustard top contributors,
• India ranks globally: 2nd in arable land, 3rd in cereal produc- Gujarat and Rajasthan leading.
tion, leading in milk • Sugar Crops: Uttar Pradesh major producer.
• GVA Contribution: Crops (54.3%), Livestock (30.9%), Forestry • Forestry Products: Industrial wood, fuelwood, NTFP major drivers.
(7.9%), Fishing (6.9%) in 2022-23. • Fishing and Aquaculture: Significant output increase, Andhra
• State-wise Details from 2011-12 to 2022-23: Highest Output: Pradesh leading.
Uttar Pradesh (cereals, sugarcane); Lowest Output: • About NSO: Established in 1950 as CSO, renamed NSSO in 1970,
• Livestock: Highest Output: Uttar Pradesh, Rajasthan (milk, meat, and NSO in 2019.
eggs); Lowest Output: Goa. • K ey statistical agency under MoSPI (Ministry of Statistics and
• Forestry and Logging: Major products: Industrial wood (68%), Fuel- Programme Implementation).
wood (20%), NTFP (12%) in 2022-23.; Maharashtra (16.4%), Rajas- • K ey Reports released by NSO: Household Consumption
than (10.6%), Uttar Pradesh (8.7%), Madhya Pradesh (7.7%), Odisha Expenditure Survey, EnviStats India 2024, Energy Statistics India
(5.3%). 2024, National Accounts Statistics 2024, Quarterly Estimates of
• Fishing and Aquaculture: Highest Output: Andhra Pradesh (40.9% GDP.
share), leading in fish and prawn farming; Lowest Output: Arunachal CD
Pradesh.

11.1.9 Golden Rice

• P hilippines Court of Appeals revokes biosafety permits for GM enhance beta-carotene production.
Golden Rice, BT eggplant due to safety violations. • F
 ield trials conducted since 2004; approvals in Canada, US
• Golden Rice: Genetically engineered to produce beta-carotene, (2018), Philippines (2019).
addressing vitamin A deficiency.  ritics raise safety, environmental, efficacy concerns; Green-
• C
• Commercial production approved in the Philippines in 2021, first peace, Vandana Shiva oppose.
biosafety permit issued in July 2021.  olden Rice 2: Developed by Syngenta in 2005, produces higher
• G
• Bt Eggplant: Developed by UPLB to resist pests, enhance farmer levels of carotenoids compared to original.
productivity. Down to Earth
• Research initiated by Rockefeller Foundation in 1982.
• Scientific details published in 2000 by Ingo Potrykus, Peter
Beyer.
• Genetics: Incorporates genes from daffodils, soil bacterium to

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11.1.10 PM-KISAN Scheme
• P rime Minister approves 17th installment of PM Kisan scheme,  bjective: Provides annual financial assistance of ₹6,000.
• O
benefiting 3 crore farmers with approximately Rs 20,000 crore.  ssistance distributed in three equal installments of ₹2,000
• A
• PM-KISAN: Central Sector Scheme with 100% funding from every 4 months via Direct Benefit Transfer (DBT).
Government of India.  eneficiaries: Farmer families holding cultivable land, pri-
• B
• Implemented by the Ministry of Agriculture and Farmer’s Welfare; marily Small and Marginal Farmers (SMFs) with up to 2 hect-
Launched in February 2019. ares, identified by State/UT
• Aim: To help farmers procure various inputs for crop health and The Economic Times
yields.

11.2 Horticulture, Floriculture, Commercial crops, Bamboo Production – MIDH, NFSM-CC, etc.
11.2.1 CDP-SURAKSHA Digital Platform
• G overnment introduces CDP-SURAKSHA for horticulture subsidy geo-fencing.
disbursal.  perational mechanism involves farmer interaction and subsidy
• O
• CDP-SURAKSHA: “System for Unified Resource Allocation, Knowl- disbursement.
edge, and Secure Horticulture Assistance.” • C
 luster Development Programme (CDP) aims to develop
• Facilitates instant subsidy disbursal to farmers’ bank horticulture clusters for global competitiveness.
accounts via e-RUPI voucher. • T
 he Central Sector Scheme covers 55 clusters, with 12 in pilot
• Upfront subsidies provided during material purchase; vendors phase, benefiting 10 lakh farmers.
receive payment after farmer verification.  overnment assistance based on cluster size, up to Rs 25
• G
• Key features include PM-KISAN database integration, cloud- crore for mini clusters, Rs 50 crore for medium, and Rs 100
based server space from NIC, UIDAI validation, eRUPI inte- crore for mega clusters.
gration, LGD, content management system, geotagging, and The Indian Express

11.2.2 Atmanirbhar Clean Plant Programme (CPP)

• $
 98 million ADB loan to establish advanced laboratories and di- sector.
agnostic testing at Clean Plant Centres. • K
 ey Objectives:
• Announced in Union Budget 2023-24 to improve plant health • S trengthen the regulatory framework for plant health.
management in India. • E stablish Clean Plant Centres for disease-free horticultural
• Goal: Provide farmers with access to clean, disease-free planting crops.
materials. • C ollaborate with private nurseries, researchers, state gov-
• Implemented by: National Horticulture Board (NHB), establish- ernments, and growers’ associations.
ing Clean Plant Centres • Introduce certification schemes for private nurseries to
• Objective: Enhance global competitiveness of India’s horticulture ensure disease-free materials.

India’s Horticulture Sector

• In 2022-23, 351.92 million tonnes of horticulture production, surpassing foodgrain output.
• 2 nd largest producer of fruits and vegetables globally.
• C ontributes 33% to agriculture Gross Value Added (GVA).
• L eading producer of Bananas, Lime, Papaya, and Okra.
• Government policies driving steady increase in horticulture production.

CD

11.2.3 Asia Tea Alliance (ATA)

• R ejected GM tea in response to climate challenges affecting  ey regions: Northeast India, north Bengal (Darjeeling, Terai,
• K
global tea production. Dooars), Nilgiris in the south.
• India’s tea production dropped by 10% due to climate  equires cool to warm temperatures (15–23°C), 5 hours of
• R
change, prompting push for GM tea. sunlight, and 150-200 cm rainfall.
• ATA establishment: April 19, 2019, in Guizhou, China. • D
 arjeeling Tea: Known as the “Champagne of teas,” first GI
• 5 Members: India, China, Indonesia, Sri Lanka, Japan. tagged in 2004–05.
• Goals: Promote tea trade, cultural exchange, and global tea advo- The Hindu
cacy.
• About Indian Tea Industry:
• 2
 nd largest tea producer and largest black tea produc-
er after China, the 4th largest exporter.
• Largest consumer of black tea, accounting for 18% of global
consumption.
• 16 million workers are directly employed, with an equal
number working indirectly.
• Governed by the Tea Board of India under Union Government

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11.2.4 Coffee Board of India
• C offee Board of India (CB) launched a 10-year roadmap to dou- la and Tamil Nadu.
ble coffee production and exports by 2034. • I ndia exports over 70% of its coffee production.
• Coffee cultivation began in 1600 AD by Baba Budan in Chik- • India is the 8th largest coffee exporter globally (by volume).
magalur, Karnataka. • P eak exports: March to June.
• Until 1995, coffee was marketed through a pooled supply • Agro-climatic Conditions for Coffee:
• Post-1995, coffee marketing shifted to the private sec- • T ropical plant; grows in semi-tropical climates.
tor following economic liberalisation. • R equires 16°-28°C temperature, 150-250cm rainfall,
• CB is managed by the Ministry of Commerce and Industry, es- and well-drained slopes.
tablished in 1942, based in Bangalore. • H armful conditions: Low temperature, frost, dry weather, and
• 33 members, including a Chairman appointed by the Government harsh sunshine.
of India. • B est growth: Laterite soils of Karnataka.
• Functions: • M ajor Coffee Varieties:
• Enhance production, productivity, and quality. • Arabica: High market value, mild aromatic flavor.
• Promote exports to increase value returns. • Robusta: Less valuable than Arabica.
• Support the domestic coffee market. • L iberica: Cultivated in smaller quantities.
• Coffee Industry in India – Imports/Exports: The Hindu
• Karnataka is the largest producer (70%), followed by Kera-

11.2.5 Growth in Ashwagandha Exports

• A shwagandha exports surge 8x in 6 years, targeting US, Czech • A vailable as extracts, powder, raw herbs, serves global markets.
Republic, Canada. • T reats rheumatic pain, nervous disorders, epilepsy, and more.
• Indian Ayurvedic industry grows at 17% CAGR, $3B (2014) to $24B. • U sed as tonic, sedative, for ulcers, conjunctivitis, asthma.
• Gujarat ranks 4th, 850 Ayurvedic units, after UP, Kerala, Maha- • U sed in herbal tea, tablets, syrups.
rashtra. • G rown in Rajasthan, Punjab, Haryana, UP, Gujarat, Maharashtra,
• India leads Ashwagandha production, Rajasthan, MP key. MP.
• Exported mainly as extracts, gains US traction, competes with • H ardy, drought-tolerant, prefers dry season, kharif crop, 600-
Chinese Ginseng. 1200 m altitudes.
• Ashwagandha, Indian Ginseng or Withania somnifera, an adapto- • Thrives in sandy loam, pH 7.5 to 8.0, good drainage.
gen. The Hindu

11.2.6 Jute Production in India

• J ute production is expected to decline by 20%, says National Jute families and employing 1.4 lakh in the tertiary sector and 2.6 lakh in
Board (NJB). manufacturing.
• NJB, established in 2008 under the NJB Act, operates under • I ndia is the largest jute producer, but Bangladesh leads global
the Ministry of Textiles. jute trade, accounting for 75% of exports.
• Focuses on promoting the jute sector; HQ: Kolkata, West Bengal. • P rimarily concentrated in West Bengal, Assam, and Bihar, which
• Initiatives include Jute-ICARE for better cultivation and promotion produce 99% of India’s jute.
of Jute Geotextiles in infrastructure. • Ideal conditions: 25-35°C temperature, 150-250 cm rainfall, and
• Implements the Jute Technology Mission (JTM) to improve jute well-drained alluvial soil.
productivity and quality. •  rown in the Ganga-Brahmaputra delta region, jute is versa-
G
• Jute, known as the ‘golden fibre,’ is natural, renewable, biodegrad- tile, used for gunny bags, mats, ropes, and more.
able, and eco-friendly, ideal for packaging. •  eeds are planted between April-May, harvested between July-
S
• Over 150 years old, with around 93 jute mills in operation, per August.
the Indian Jute Mills Association (IJMA). • L
 eaves can be sold as vegetables, while the outer stem produces
• First jute mill was established in 1854 in Rishira, near Kolkata. fibre.
• Post-independence, India retained the jute factories, •  he government sets Minimum Support Price (MSP) for raw jute
T
while jute-growing areas remained in Bangladesh. procurement.
• Vital in East India, particularly West Bengal, supporting 40 lakh The Hindu

11.2.7 Fair and Remunerative Price (FRP) of Sugarcane

• C abinet Committee on Economic Affairs approves ₹340/quintal as industry reorganization.
sugarcane FRP for 2024-25. • F
 actors considered for FRP determination include: (1) Cost
• FRP: Price set by government, legally binding for mills to pay of sugarcane production; (2) Returns from alternative crops;
farmers for procured cane. (3) Sugar availability and pricing; (4) Recovery of sugar from
• Mills can opt for installment cane; (5) Sales of by-products like molasses; (6) Ensuring
• Delayed payments can incur up to 15% interest, with unpaid FRP reasonable margins for growers.
recoverable as dues. The Hindu
• Sugarcane Control Order, 1966 mandates payment within 14 days
of cane delivery.
• FRP recommended by CACP (Commission for Agricultural Costs
and Prices), announced by CCEA chaired by Prime Minister.
• FRP based on Rangarajan Committee Report on sugarcane

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11.3 Animal Husbandry, Fisheries, and Livestock
11.3.1 Punganur Dwarf Cows
On Makar Sankranti, Prime Minister Narendra Modi fed Punganur than the typical 3-5% found in other breeds.
cows, highlighting the significance of this unique breed. Key points • A
 daptability: These cows are known for their drought resis-
include: tance and ability to thrive on dry fodder, making them well-suited
• Origin: Punganur cows are native to the Chittoor dis- for arid regions.
trict in Andhra Pradesh, India. • C
 onservation Status: The breed has faced endangerment in the
• Size: They are among the smallest cattle breeds globally, with an past, with efforts made for its conservation. As of 2024, the con-
average height of 70–90 cm and weight ranging from 115 to 200 kg. servation status is listed as «not at risk.”
• Milk Production: Despite their small size, Punganur cows produce Firstpost
milk with a high fat content of approximately 8%, which is higher

11.3.2 PM Matsya Kisan Samridhi Sah-Yojana (PM-MKSSY)

• C
 entral Sector Sub-scheme under Pradhan Mantri Matsya Sam- • M
 icro and Small enterprises: Proprietary Firms, Partnerships,
pada Yojana (PMMSY). Companies, Societies, LLPs, Cooperatives, Federations, SHGs,
• Rs 6,000 crore estimated outlay. FFPOs, Startups.
• 50% public finance including World Bank and AFD external • F
 ormalization of the unorganized fisheries sector through self-
financing. registration.
• Rest 50% private finance anticipated investment from beneficia- • A
 ccess to institutional financing for fisheries sector micro and
ries/private sector. small enterprises.
• Implemented for 4 years from FY 2023-24 to FY 2026-27; across • O
 ne-time incentive for purchasing aquaculture insurance.
all States and UTs.  rants for adoption and expansion of fish and fishery prod-
• G
• Beneficiaries include Fishers, Fish Farmers, Fish Workers, Fish uct safety and quality assurance systems, and job creation.
Vendors; FFPOs include FPOs. The Hindu

11.3.3 Foot and Mouth Diseases in Cattles

• F oot-and-mouth disease (FMD) affects many milch cattle in Uttar are endemic globally.
Pradesh.  haracterized by fever and blister-like sores in the mouth, tongue,
• C
• FMD is a highly contagious viral disease with significant teats, and hooves.
economic impact. • R
 arely fatal in adults but high mortality in young animals.
• Affects cattle, swine, sheep, goats, and other cloven-hoofed  auses severe production losses, leaving animals weakened.
• C
ruminants. • F
 MD Mukt Bharat Abhiyan (2016-17) under Rashtriya Krishi Vikas
• Intensively reared animals are more susceptible. Yojana.
• Does not affect horses, dogs, or cats. • N
 ational Animal Disease Control Programme (2019) aims to
• Spread affects livestock production and disrupts regional and control FMD and Brucellosis through vaccination.
international trade. The Times Of India
• Caused by ‘aphthovirus’ of the family Picornaviridae; Seven strains

11.3.4 21st National Livestock Census, 2024

• C entre has launched the 21st NLC, to count livestock nationwide. yield.
• Data collection is conducted via a mobile app for the first time, • B
 uffalo Population: Rose by 1% to 109.85 million, boosting
improving accuracy and speed. milk production.
• Covers 15 animal species (EXCLUDING poultry), including cattle, • S
 heep and Goat: Sheep up by 14.1% (74.26 million); goats up
buffalo, yak, sheep, goat, pig, camel, horse, donkey, and elephant. by 10.1% (148.88 million).
• Records details on 219 indigenous breeds, livestock holdings by • P
 oultry: Grew 16.8%, reaching 851.81 million, indicating
pastoralists, and gender data on those involved in livestock rearing. expanded poultry farming.
• Conducted every 5 years to count all domesticated animals • F
 emale Livestock: Female cattle up 18%, female buffaloes up
across rural and urban areas. 8%, highlighting dairy focus.
• Provides data on livestock population, breeds, and distribution, • 1 9th Livestock Census (2012):
conducted by the Ministry of Animal Husbandry with State/UT • S
 howed buffalo growth and a decline in indigenous cattle.
collaboration since 1919. • N
 oted significant poultry growth, reflecting changing agricul-
• 21st Census (2024) introduces mobile app-based data collection tural patterns.
for real-time accuracy. The Hindu
• Supports programs like the National Livestock Mission (NLM) for
breed and feed improvements.
• 20th Livestock Census (2019):
• Total Livestock: 535.78 million, a 4.6% increase from 2012.
• Bovine Population:79 million, including cattle, buffalo, mithun,
and yak.
• Indigenous vs. Exotic Breeds: Indigenous cattle dropped 6%,
while exotic breeds rose by 29.3% due to demand for high milk

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11.4 Technology and Digital Agriculture
11.4.1 National Pest Surveillance System (NPSS)
• C entre launched the AI-based National Pest Surveillance Sys- • F
 armers can take photos of pests or infested crops, which experts
tem (NPSS) to help farmers connect with agriculture scientists for analyze.
pest control. • E
 xperts suggest the correct pesticide amount and timing to
• NPSS is an AI-based platform launched on August 15, 2024. reduce excessive use.
• It helps farmers connect with experts using their phones for • T
 argeting around 14 crore farmers across India.
effective pest control. • A
 ims to reduce crop damage, improve pest management, and
• Aims to reduce farmers’ reliance on pesticide retailers. minimize soil damage from excess pesticides.
• Provides data for crops like Rice, Cotton, Maize, Mango, and The Hindu
Chilies.

11.4.2 Digital Agriculture Mission

• T he Union Cabinet approved the “Digital Agriculture Mission” with using real-time data.
a budget of ₹2,817 crore. • ( 3) Soil Profile Maps: Detailed digital maps of 142 million hect-
• ₹1,940 crore will come from the Centre, with the rest from states ares on a 1:10,000 scale, offering soil data for precision agricul-
and UTs. ture.
• Initially planned for 2021-22 but delayed due to the pandemic. • D igital General Crop Estimation Survey (DGCES): A tech-based
• Announced in Budgets 2023-24 and 2024-25. system to provide accurate agricultural production estimates.
• To create Digital Public Infrastructure (DPI) for agriculture, like • E nables farmers to access digital services, improve deci-
Aadhaar and UPI in e-governance. sion-making, enhance productivity with soil info, and get accurate
• Major Components: (1) AgriStack: Centralized platform integrating crop estimates.
agricultural services and data to improve access and efficiency. • R olled out nationwide over the next two years, until 2025-
• (2) Krishi Decision Support System (DSS): Provides data-driven The Indian Express
recommendations for crop management and resource optimization

11.4.3 NABARD Blended Fund for Agri-Startups

• B lended Fund for Agri-Startups was announced in the FY23 bud- opment and agricultural growth.
get to finance startups in ‘Sunrise Sectors’. • O  perates under RBI Act, 1934, headquartered in Mumbai.
• Aims to support startups facing scaling challenges due to limited • F  acilitates credit flow for agriculture, rural industries, crafts.
access to equity and debt. • G  overned by Board of Directors appointed by GoI.
• Agriculture Accelerator Fund (2023): Supports agritech startups • Provides refinance support for agricultural and rural development.
and rural entrepreneurs. • Extends direct loans for rural projects.
• Innovation and Agri-Entrepreneurship Development Program • Promotes research, training, and technology transfer.
(2018-19): Provides financial assistance for startups under Rashtri- • Administers government schemes like Rural Infrastructure
ya Krishi Vikas Yojana. Development Fund (RIDF), Watershed Development Fund (WDF).
• NABARD was established on July 12, 1982, to promote rural devel- Live Mint

11.5 Food Security, Processing, and Exports

11.5.1 Food Corporation of India (FCI)
• G ovt. increases FCI’s authorized capital from ₹10,000 crore to  asks include procuring grains at MSP, supplying grains to PDS,
• T
₹21,000 crore. and maintaining strategic reserves.
• FCI was established in 1965 under the Food Corporation Act, • S
 hanta Kumar Committee (2014) proposed reforms to enhance
1964. FCI’s efficiency.
• Operates under the Ministry of Consumer Affairs, Food and Pub- The Hindu
lic Distribution, Government of India.

11.5.2 National Mission on Edible Oils – Oilseeds (NMEO-Oilseeds)

• C entre approved the NMEO-Oilseeds to be implemented from • T arget 25.45 million tonnes of domestic edible oil production,
2024-25 to 2030-31. meeting 72% of demand by 2030-31.
• To boost domestic oilseed production and achieve self-reli- • E xpand oilseed cultivation by an additional 40 lakh hectares.
ance in edible oils. • I mportant components:
• Increase production of key oilseeds like Rapeseed-Mustard, • T arget fallow lands from rice and potato crops and promote
Groundnut, Soybean, Sunflower, and Sesamum. intercropping.
• Enhance extraction from secondary sources like Cottonseed, Rice • U tilize global technologies like genome editing for seed
Bran, and Tree-Borne Oils (TBOs). development.
• Raise primary oilseed production from 39 million tonnes (2022- • Introduce an Online 5-year rolling seed plan via the ‘SATHI’
23) to 69.7 million tonnes by 2030-31. Portal for timely seed supply.

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 • S et up 65 new seed hubs and 50 seed storage units in the private entities.
public sector.  rovide assistance to FPOs, cooperatives, and industries to
• P
• Establish over 600 Value Chain Clusters in 347 districts, establish or upgrade oil extraction units for Cottonseed,
covering 10 lakh hectares annually. Rice Bran, Corn Oil, and TBOs.
• Clusters will be managed by FPOs, cooperatives, and public or The Indian Express

11.5.3 Import Tax on Edible Oils

• I ndia increased the basic import tax on crude and refined edible • P alm oil makes up over 50% of India’s edible oil imports.
oils by 20%. • India consumes7 kg/year per capita, with 16.5 million tonnes of
• Aims to protect domestic farmers facing low oilseed prices. imports in 2022-23.
• May raise edible oil prices, reduce demand, and lower imports of • O nly 40-45% of demand is met through domestic production.
palm oil, soyoil, and sunflower oil. • D omestic production may reach 16 MT by 2030 and 26.7 MT by
• India imports over 70% of its vegetable oil needs, mainly sourcing: 2047 under a Business-As-Usual (BAU) scenario.
• Palm oil from Indonesia, Malaysia, and Thailand. • S elf-sufficiency Targets: Aim for edible oil production of 36.2 MT
• Soyoil and sunflower oil from Argentina, Brazil, Russia, and by 2030 and 70.2 MT by 2047.
Ukraine. Business Stan

11.5.4 National Mission on Edible Oils – Oil Palm (NMEO-OP)

• H ighlighted by the PM during his visit to Arunachal Pradesh. • E xpand oil palm acreage by an additional 6.5 lakh hectares by
• Aims to achieve self-reliance in edible oil production due to 2025-26.
significant foreign exchange outflow. • I ncrease crude palm oil production to 11.2 lakh tonnes by 2025-
• India, the world’s largest importer of vegetable oils, is projected 26 and up to 28 lakh tonnes by 2029-30.
to buy 15.6 million metric tons of cooking oils in the 2023-24 oil • Increase consumer awareness to maintain a consumption level of
year. 19.00 kg/person/annum till 2025-26.
• Imports constitute 57% of demand of India’s vegetable oil. • T he scheme introduces price stability for Fresh Fruit Bunches
• Recent decline in imports attributed to factors like reduced palm (FFBs) through Viability Price (VP).
oil availability and changes in soybean oil imports from Argentina • E stablishes a Formula Price (FP) set at 14.3% of Crude Palm Oil
and Brazil. (CPO), adjusted monthly.
• NMEO-OP is a Centrally Sponsored Scheme launched in • E nhances input assistance for oil palm planting material,
2021 with a focus on increasing oil palm cultivation and crude palm maintenance, and intercropping interventions.
oil production. • O ffers special assistance for replanting old gardens and tailored
• Particularly emphasizes the North-East region and Andaman and support for regions like the North-East and Andaman.
Nicobar Islands. The Hindu

11.5.5 FSSAI Mandate on Fruit Juice Labeling

• F SSAI mandates removal of ‘100% fruit juices’ claims from labels ceed 15 gm/kg.
and ads of reconstituted fruit juices by all Food Business Operators  oncerns arise when water is a major ingredient or when juices
• C
(FBOs). are reconstituted with concentrates.
• Deadline: FBOs to use existing pre-printed packaging before  bout Food Safety and Standards Authority of India (FSSAI): Au-
• A
September 1, 2024. tonomous body under Ministry of Health & Family Welfare,
• Products must comply with Food Safety and Standards (Labelling established by Food Safety and Standards Act, 2006.
and Display) Regulations, 2020. • R
 esponsible for regulating food safety to protect and promote
• ‘Reconstituted’ must be specified in ingredient lists for juices public health.
from concentrate. CD
• ‘Sweetened juice’ label required if added nutritive sweeteners ex-

11.6 Fertilizer and Sustainable Practices

11.6.1 Expansion of Nano DAP
• T he interim budget announces wider application of Nano DAP • 5 00 ml Nano DAP bottle priced at Rs 600, equivalent to 50-kg
(Di-Ammonium Phosphate) fertilizer on various crops across all conventional DAP bag priced at Rs 1,350.
agro-climatic zones. • E asier to carry, store, and apply than heavy bags.
• DAP is Second most used fertilizer in India, contains Nitrogen • R equires 250-500 ml per acre per spray, mixed with water.
and Phosphorus. • D omestic production in Kalol, Gujarat, reduces import depen-
• 18% Nitrogen, 46% Phosphorus, manufactured by reacting Am- dence.
monia with Phosphoric acid. • Reduces land contamination, supports natural farming.
• IFFCO launched Nano DAP in 2023 with 8% Nitrogen, 16% Phos- • Increases earthworm population without sacrificing productivity
phorus in liquid form. or profitability.
• More Efficient than Conventional DAP: The Indian Express
• Nano particles (<100 nm) penetrate seeds or plant openings
better, leading to higher seed vigour, chlorophyll, yield.

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11.6.2 Nutrient Based Subsidy (NBS) Scheme
 egulates subsidies for Phosphatic (P) and Potassic (K) fertilizers
• R • S ubsidy Rates: Decided annually or bi-annually, based on market
based on nutrient content, EXCLUDING Urea. prices of fertilizers and raw materials.
• Introduced in 2010, by the Ministry of Chemicals and Fertiliz- • Aims & Objectives:
ers to promote balanced fertilization. • Encourages balanced use of Phosphorus and Potassium with Ni-
• Encourages use of multiple fertilizers to ensure optimal plant trogen to improve soil health.
nutrition. • Reduces over-reliance on Urea, improving the use of other
• Implemented by the Department of Fertilizers, Ministry of Chemi- essential nutrients.
cals and Fertilizers. • Makes P&K fertilizers more affordable and accessible.
• Applies only to P&K fertilizers, excluding Urea. CD

11.7 Agricultural Trade and Export Development

11.7.1 Spices Board of India
• S pices Board of India targets $25 billion in annual spice exports development, and post-harvest improvement programs for 52
by 2047, up from the current $4.4 billion. scheduled spices.
• Current spice consumption is 10 million tonnes, with 42 million • M
 ajor producing states include Madhya Pradesh, Rajasthan,
tonnes exported each year. Gujarat, etc.
• By 2047, the goal is to export 2.7 million tonnes annually. •  pice production is growing rapidly, with exports totaling $4.25
S
• Spices Board: Formed in 1987 under the Spices Board Act 1986, billion in 2023-24.
merging Cardamom Board and Spices Export Promotion Council. • C
 hili, cumin, turmeric, ginger, and coriander make up about 76%
• International link between Indian exporters and importers of total production.
abroad, under the Ministry of Commerce & Industry. • T
 op export destinations: China, USA, Bangladesh, UAE, etc.
• Headquarters in Kochi with regional laboratories across India. The Hindu
• Functions include promoting organic production, cardamom

11.7.2 Tobacco: The Silent Killer

• T obacco Board authorizes 100 million kg crop size for Karnataka in der Tobacco Board Act, 1975.
2024-25. • It aims to promote orderly development of the tobacco indus-
• Tobacco is drought tolerant, grown in 0.45 M ha area in India. try in Andhra Pradesh, Karnataka, and Tamil Nadu.
• India is the 2nd largest producer and exporter after China and • It operates under the Ministry of Commerce and Industry and is
Brazil. headquartered in Guntur, Andhra Pradesh.
• Production: 300 M kg Flue-Cured Virginia (FCV) tobacco from • K ey Functions include: (1) Regulation of production, curing,
0.20 M ha, 450 M kg non-FCV tobacco from 0.25 M ha. grading, and marketing of Virginia tobacco; (2) Licensing and
• Indian tobacco accounts for 10% of global area, 9% of total registration of growers, manufacturers, exporters, and dealers and
production. (3) Price stabilization and quality control initiatives among others.
• The Tobacco Board was constituted on January 1, 1976, un- The Hindu

11.7.3 Global Pulse Confederation (GPC)

• G PC launches Pulses 24 convention in New Delhi, India. • T
 op producing states – Madhya Pradesh, Maharashtra, Rajas-
• Founded in 2016 through merger of GPC and ISI. than, Uttar Pradesh, Karnataka.
• Membership: 24 national associations, 500+ private sector • R
 abi Pulses (over 60%) are Gram, Chana, Masoor, Arhar; Kharif
members. Pulses: Moong, Urad, Tur.
• Based in Dubai, licensed by DMCC.  abi crops need a mild cold climate during sowing and vegetative
• R
• Represents the entire pulse industry value chain. stages, warm during maturity.
• India: Largest producer (25%), consumer (27%), importer (14%) of • K
 harif crops require a warm climate throughout.
pulses globally. • M
 ajor export destinations (2022-23) are Bangladesh, China,
• Pulses cover 20% of food grains area, contributing 7-10% to total UAE, USA, Nepal.
foodgrains production. The Hindu

11.7.4 India’s Surge in Pulses Imports

• India’s pulses imports surge by 84% in fiscal 2024, highest in six • G oal: Self-sufficiency in pulse production by 2027.
years. • I ndia largest producer, consumer, importer of pulses globally
• Lower production prompts duty-free imports of red lentils, yellow (FAO).
peas. • P ulses cover 20% of food grain area, contributing 7-10% of total
• Pulses cultivated in both Kharif and Rabi seasons, Rabi contrib- production.
utes 60% production. • G ram (Chana) dominant pulse, followed by Tur/Arhar, Urad,
• Kharif: Arhar, Moong, Urad, Lobia, Kabuli Chana, Rajmash. Moong.
• Rabi: Desi Chana, Masoor, Matar. The Hindu
• Top producing states: MP, Maharashtra, Rajasthan, UP, Karnataka.
• initiatives: NFSM for Pulses, PM-AASHA Scheme.

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11.8 Geographical Indication (GI) and Indigenous Crops
11.8.1 King Chilli Festival
• T he village of Seiyhama, Nagaland, hosted the 3rd Naga King • R ich in capsaicin, offering pain relief, boosting metabolism, pro-
Chilli Festival, celebrating one of the world’s hottest chillies. moting heart health, and reducing inflammation.
• Also known as Raja Mircha or Bhut Jolokia, it has heat lev- • Traditionally used in Nagaland to preserve food in hot, humid
els exceeding 1 million Scoville Heat Units (SHU). conditions.
• Grown in Nagaland, Assam, Manipur, and Arunachal Pradesh. • Grown in bamboo groves using traditional methods.
• Certified by Guinness World Records in 2006 as the world’s • Farming begins in December or January, with peak harvests in
hottest chilli. August and September.
• Received a GI tag in 2008, recognizing its unique origin. • Around 150 households in Seiyhama village cultivate Naga King
• Heat range: 800,000 to 1,041,427 SHU, much hotter than Chilli, yielding 14,000 kg annually, valued at ₹70 lakh.
jalapeños (2,500 to 8,000 SHU). Down to Earth

11.8.2 Nanjangud Rasabale Banana

• C ultivation has been revived after a significant decline, despite • G rown in black saline alluvial soil along the banks of the Kapila
receiving GI certification in 2006 for its unique taste and aroma. River.
• Originates from Devarasanahalli village near Nanjangud, Mysore • P opular in traditional festivals, religious ceremonies, and refer-
district, Karnataka. enced in Kannada literature.
• Known for its unique taste, aroma, small size, and buttery soft • Mentioned in Kayyar Kinhanna Rai’s notable Kannada poem.
texture; it measures 5-8 cm in length and 2-3 cm in diameter. • Quality declined due to the heavy use of chemical fertilizers.
• In 2006-07, 180 farmers cultivated on 100 hectares; by 2019- • Important for local farmers; high demand due to limited availabil-
20, this dropped to 15 farmers on 10 hectares. ity.
• By the end of 2023-24, 200 farmers will be cultivating The Hindu
75 hectares.

Flash Notes: ECONOMY HQ: Ground Floor, Apsara Arcade, ORN, New Delhi-05 80765 17832 62
Flash Notes: ECONOMY HQ: Ground Floor, Apsara Arcade, ORN, New Delhi-05 80765 17832 63