Current Affairs 26 & 27 January 2025

Daily Current Affairs Quiz
26 & 27 January, 2025

International Affairs

1. India-Indonesia Relations

Context:

The visiting Indonesia’s President Subianto has been the chief guest at India’s Republic Day since Indonesia’s President Sukarno attended the first Republic Day of India in 1950.

Historical Importance of India-Indonesia Relations

• Ancient Relations
  • India and Indonesia have an ancient bond that binds them into deep historical relationships in terms of trading, traveling and cultural exchange such as the dissemination of Javanese Hinduism Vedic scriptures and Sanskrit.
• Solidarity Against Imperialism
  • India supported the Indonesian independence struggle against Dutch rule by prohibiting overflights from the Netherlands and supplying planes to evacuate people during the colonial period. Sukarno was the first president of Indonesia and expressed his gratitude to India for this gesture in 1950.
• Non-Aligned Movement (NAM)
  • Both countries have played a paramount role in the formation of NAM as they were opposed to great power politics mainly at the Bandung Conference.
• Common Objectives of Development
  • India and Indonesia have been kept together due to a common vision of justifiable development and religious tolerance within their pluralistic societies.

Geopolitical Cooperation and Common Concern

• Current Geopolitical Situation
  • In the wake of recent developments in both countries, they have found common ground on issues ranging from western sanctions, US-China competition ,China’s aggression in the Indo-Pacific and food fertilizer and fuel security.
• G20 and BRICS
  • Indonesia’s role in G20 summits especially in Bali 2022 and Delhi 2023 and its latest induction into BRICS has further sunk the common objective between India and Indonesia. Subianto’s visit is an extension of this evolving relationship which now stretches from Bandung to an extended BRICS.

Key Highlights of MoUs Signed Between the Countries

• Regional Peace and Security
  • Both committed to peace and security together with freedom of navigation in Southeast Asia and the Indo-Pacific area while showing respect for International Law Maritime Cooperation Signing agreements on safety and security issues between the two countries coast guards.
• Defence and Economic Cooperation
  • Indonesia inked its defence cooperation agreement with India and stated that it will send a high level defence delegation to the country shortly.
  • Agreements were made on cooperation in fields like defence, manufacturing, supply chains ,cyber security, antiterrorism and deradicalization.
• Infrastructure and Business Opportunities
  • The Indonesian government also extended an invitation to Indian businesses to participate in the country’s infrastructure sector as one of the sectors of considerable investment opportunity.
• Health and Education Cooperation
  • Agreements regarding health traditional medicine, and cultural exchange were signed.
  • Indonesia wants to engage India’s hospital chains, medical training for doctors, and internship of healthcare professionals to improve the state of health in Indonesia.
• Historical and Diplomatic Ties
  • President Subianto recalled and stated that India had played a role in supporting Indonesia’s fight for independence after the World War pointing to financial and medical aid, it extended and the early recognition it gave to Indonesia’s sovereignty.
  • He established a connection between Indias advocacy for SouthSouth cooperation and the historical IndiaIndonesia consensus at the 1955 Bandung Conference

Indonesia Joined BRICS

• Indonesia joined BRICS on January 7, 2025 and India played a supporting role in this process.
• Both countries are interested in further strengthening their cooperation under multilateral platforms such as ASEAN and BRICS.

Conclusion

• The talks between the two heads of state touched upon a shared vision for a rules-based order in the Indo-Pacific region increased economic and defense cooperation and continuation of historical camaraderie between India and Indonesia.

2. US Exit the Paris Agreement

History

• The landmark accord in 2015 wrote wherein the parties made commitments to limit the temperate rise of global warming to levels well below 2°C while striving for no more than 15°C above the preindustrial level.
• Despite global turmoil that included terrorist attacks in France during 2015, the Accord was considered to be a political victory, where 196 nations came together towards a common goal.

• Global Instability
  • In the last ten years, climate action has not been collective due to ongoing conflicts with increasing inflation as well as extreme political polarization.
• US Exit
  • Donald Trump executive order to withdraw the United States from the Accord and its implications are huge.
  • More US emissions would lead to an additional 4 billion tonnes of CO2 equivalent by 2030.
  • Republican policies include rolling back climate regulations, increase extraction of fossil fuel and reducing the incentives for green energy.
• Global Fallout
  • Europe would retaliate, for example by imposing the Carbon Border Adjustment Mechanism on the trade.
  • China can leverage the opportunity of becoming a leader in green technology innovation.

Weaknesses of the Paris Agreement

• Loosely Conventional Commitments
  • NDCs are non-enforceable and so progress is entirely dependent on political will.
• Global Stock
  • Reports have data gaps often.
• Ambiguity Around 15°C
  • A critical benchmark for small island nations, but does not factor in latent heat of oceans hence greater risks.
• Half Success
  • The pact has spurred lawsuits and side deals on topics like methane and biodiversity but lacks practical implementation measures.
• Lack of Trust and Shortage of Funding
  • The industrialized world did not provide enough financing previously for the developing world so a lack of trust was developed. There is now a promise to increase annual contributions by 300 billion to continue through 2035 But the uncertainty this brings after US withdrawal looms over it all.

Opportunities Amid Challenges

• A US withdrawal opens up the opportunity to increase leadership from elsewhere.
• The possible legal binding targets and sanctions for noncompliance strengthen the agreement to make it a truly effective tool.

Conclusion

• The US withdrawal from the Paris Agreement is the weakest link of international climate cooperation though it allows other countries to step forward it makes what is already challenging to achieve within the framework of the Agreement worse. To continue being relevant, the Agreement must be strengthened through the enforcement mechanism, reliable funding, and collective political will for a catastrophic warming to be avoided.

What is Paris Agreement?

National Affairs

1. India’s Tuberculosis (TB) Elimination Program

Context:

• Findings from the RATIONS
  • Trial Between 2019 and 2022 in four districts of Jharkhand among 2,800 TB patients and 10,345 household contacts.
  • New pulmonary TB cases decreased by 48.
  • Deaths amongst individuals who are severely underweight below 35 kg decreased to 7.

India’s Tuberculosis (TB) Elimination Program

Indias TB program is a key part of the National Tuberculosis Elimination Programme (NTEP) operating in line with the National Strategic Plan (NSP) for TB Elimination aimed at eradicating TB by 2025.

Key Parts of the Program

• Pradhan Mantri TB Mukt Bharat Abhiyaan (PMTBMBA)
  • Launched in 2022.
  • Emphasizes better treatment results community empowerment and corporate social responsibility CSR involvement.
• Nikshay Mitra Initiative
  • Offers supplementary support to TB patients at all levels.
  • Diagnostic support.
  • Nutritional assistance.
  • Vocational aid.
• National Strategic Plan (NSP) for Tuberculosis Elimination 2017-2025
  • Targets to eradicate TB in India by 2025 through integrated approaches.
• TB Harega Desh Jeetega Campaign
  • It aims at mass mobilization and involvement to bring out a TB free nation.
• Nikshay Poshan Yojana
  • Nutritional support to the patient during treatment.
• REPORT India
  • Regional Prospective Observational Research for TB.
• A Joint Indo-US initiative
  • A joint Indo-US initiative by the Vaccine Action Program VAP launched in 2013. Focus on research and innovation to develop solutions for India and the rest of the world against TB.
• Diagnostic Services
  • Manages a large network of laboratories to offer.
  • Microscopy tests.
  • Rapid molecular diagnostics.
• Universal Drug Sensitivity Testing (UDST)
  • Tailor treatment for every patient.
  • Eradicate spread of drug resistant TB.

International Programs

• Find Treat All End TB Program
  • Launched by the WHO Global Fund and Stop TB Partnership. It is meant to improve efforts in finding and treating all TB cases globally.
• Global Tuberculosis Report Published annually by the WHO
  • This report provides information in detail on TB incidence, mortality, and global progress toward eradication.
• The Global Plan to End TB 2023-2030
  • This is a roadmap towards the end of TB as a public health problem by 2030 It has outlined priority actions and estimated financial resource requirements. It was adopted by UN Member States and aligns with the End TB Strategy.
• End TB Strategy
  • Expanded framework in line with the United Nation’s Sustainable Development Goal SDG 33.
  • TB incidence and mortality reduction through a holistic approach.

What is Tuberculosis (TB)?

2. Universal Health Coverage

The actionable strategies for bringing Universal Health Coverage (UHC) to the doorstep of people in India are encapsulated in Mission Possible. This country houses 143 crores of populations of which 38 are children and 11 are geriatric populations-it needs solutions that are not only innovative and governed in synergy but also center around quality delivery for healthcare.

Universal Health Coverage Challenges in India

• Public Health Expenditure and Primary Healthcare System
  • India spends only 1.9% of its GDP on healthcare, which results in over-reliance on tertiary care and neglect of primary health systems. Many diseases, such as diabetes and hypertension, remain undiagnosed until complications set in, which sends patients to tertiary care.
• Regional Disparities in Healthcare Access
  • Healthcare infrastructure is not well distributed. Urban areas have better facilities than rural areas.
  • There is an availability of gaps more than 80% of rural CHCs in surgeons, physicians, pediatricians, and nearly 75% in obstetricians and gynecologists.
• High Burden of Non-Communicable Diseases
  • The country of India has shifted rapidly towards NCDs that cause deaths with a rate of 65-66%.
  • Health inequity has been amplified through pollution, poor sanitation, and malnutrition.
• Inefficient Government Programs Implementation
  • Flagship schemes like Ayushman Bharat aim to cover health coverage for 50 crore citizens, but poor awareness and uneven implementation hinder their reach.
• Poor Health Insurance Penetration
  • 95% of India’s population remains uninsured, 73% lack health coverage.
  • High Out-of-Pocket Expenditure on health is impoverishing some 55 million Indians annually.
• Fragmentation in Healthcare Governance
  • Indian federalism creates siloed and often non-aligned health policies that hardly interlink between the center and states.
• Low Preventive Healthcare
  • Although preventive care, such as immunization, screening, and lifestyle changes, are cost-effective, there is low usage of preventive care.
• Low Technology and Digital Health Adoption
  • Digital health plans through ABDM seek to digitize health records, yet penetration is low in rural regions.
• Excessive Private Sector Dependence
  • Overcrowding in public hospitals and poor quality of treatments, pushes patients into the expensive private sector for care.

Key Recommendation for Strengthening Universal Health Coverage

• Enhancing Public Health Expenditure and Health Insurance
  • India should increase public health spending to 2.5% of GDP by 2025.
  • Expanding programs like PM Ayushman Bharat, Health Infrastructure Mission can bridge infrastructure gaps.
  • Insurance through targeted schemes can reduce financial burden on vulnerable populations.
  • India can learn from the Beveridge Model and Bismarck Model for universal healthcare funded through taxation.
• Strengthening Primary Health Care
  • Primary health centers need to be renovated, with proper staffing, equipment, and medicines.
  • Preventive health screening for all NCDs and other diseases should be made compulsorily available at PHC level. It will decrease the long-term disease burden.
  • Health camps on a large scale will help in the early identification of problems, especially in rural and tribal areas.
• Workforce strengthening
  • Scaling up medical and paramedical education with proper working conditions.
  • Health-related training for nurses, midwives, and community health workers under the Skill India scheme may also help bridge the shortage.
• Advancement in Digital Health Technology
  • Accelerating ABDM shall involve providing a seamless experience to patients for registration, receiving treatment, and overall healthcare delivery.
  • Internet facilities through BharatNet and digital training for health workers will be available to every corner of the country without any denial.
• Focus on Preventive Healthcare
  • Preventive measures like vaccination, health education, and lifestyle modification can reduce disease burden and costs.
  • Strengthening of urban sanitation under Swachh Bharat Mission 2.0 and increased funding for National Programmes like the NPCDCS will have far-reaching impacts.
• Public-Private Partnerships
  • PPPs can be used for infrastructure development, diagnostics, and tertiary care.
  • Schemes such as the Viability Gap Funding for private hospitals in underserved areas improve access but do not involve increasing costs unbearably.
• Reducing Regional Disparities
  • Incentives under the central schemes may encourage states with lower health indices to improve healthcare infrastructure and workforce efficiency.
• Strengthening Regulatory Mechanisms
  • The primary thrust should be toward effective price control of essential medicines and unification of treatment charges in all private hospitals.
• Investment in Research and Indigenous Innovations
  • Fund institutes like ICMR to develop affordable, indigenous healthcare solutions.
• Integrating Traditional Medicine with Modern Healthcare
  • Scaling up the National Mental Health Programme (NMHP) and integrating it with primary healthcare through telemedicine platforms can make services accessible.
• Integrating One Health Approach
  • Establish integrated monitoring systems for zoonotic diseases and expand the scope of the National Centre for Disease Control (NCDC) to collaborate with veterinary and wildlife departments.

Way Forward

• Strengthening the Public Health System
  • Strengthen the public health system that provides promotive preventive and curative health services.
  • Integration of the private sector to decrease healthcare costs and improve quality.
• Leveraging Technology
  • Modern information technology that includes electronic medical records and mobile tools is a must for the delivery of health care. Technology facilitates more effective coordination among health care teams ranging from community health workers to specialists.
• Health Care Teams and Infrastructure
  • Local physicians lead healthcare teams that have support from community health workers who take on up to 75% of all routine medical tasks.
  • State level has to provide top class infrastructural facilities including AIIMS like in Delhi and NIMS like in Hyderabad.
• Training and Capacity Building
  • MBBS and MSc biotechnology students need training for three months in community medicine.
  • Establish an Indian Medical Service (IMS) to supervise and administer statelevel health services like IAS at the district level.

3. India’s Space Program in 2025

Context:

2025 is going to be a year of transition for the India space program shifting from planning to mission mode with many strides towards future missions such as Chandrayaan4 and the Bharatiya Antariksh Station.

• PSLV-C60 Mission
  • Launch Timing: On Dec 30, 2024 the PSLV-C60 mission was undertaken and thus a proud moment for space history with two satellites being deployed together in space for the first ever docking experiment.
• Satellite Docking Experiment
  • Mission accomplished an on orbit rendezvous and docked ISRO celebrated its first encounter of two spacecraft docking on 16 Jan 2025.
• SpaDeX and POEM-4 Joint Successful Endeavors
  • SpaDeX Satellites
    • The two satellites launched in orbit and made several rendezvous maneuvers with the final docking occurring on January 16.
    • The two satellites were operated together demonstrating the conditions that would be required for lunar and space station missions.
    • Kepler Aerospace supported the mission from the ground.
  • POEM-4 Mission
    • After the PSLVC-60 launch ISRO’s fourth stage module was utilized as an experimental satellite carrying 24 payloads.
• Key achievements include
  • Testing of Relocatable Robotic Manipulator and the Debris Capture Robotic Arm.
  • Launch of Vyom 2U with green propulsion system tested by Manastu Space.
  • Communication tests and payload demonstrations by private companies like Bellatrix Aerospace and N Space Tech.

International Cooperation and Space Missions

• Transporter 12 Mission
  • Three payloads from Indian private companies flew on board SpaceXs Falcon 9 rocket on 15 January, 2025.
• Firefly hyperspectral satellites by Pixxel Space
  • The first private satellite constellation for India: A space situational awareness camera to track low Earth orbit objects by Digantara Elevation 1 miniaturised communications satellite by XDLINX Labs.

Infrastructure and Testing for Future Missions

• New Launch Pad
  • Union Cabinet cleared the construction of the third launch pad at Sriharikota to accommodate the human spaceflight and the Next Generation Launch Vehicle NGLV in 2029.
• Vikas Engine Test
  • The ISRO tested its Vikas engine capability by restarting it in atmospheric conditions which is a crucial milestone for future missions.

• AdityaL1
  • On January 6 2025, ISRO released the first data set into the public arena regarding its Aditya L1 mission focused on the sun for a whole year illuminating the path to understanding solar activity and its potential impact on other planets in space.

Indian Space Research Organization (ISRO)

4. Guillain Barré Syndrome (GBS)

Context:

The Maharashtra government has formed a rapid response team as 16 patients of Guillain Barré Syndrome (GBS), an auto-immune disorder, are in the ventilator of the 101 patients in the state so far. At present, there are 19 suspected cases in the state, and one suspected case of death from Solapur.

Guillain Barré Syndrome (GBS)

5. Delay in MGNREGS Funding

Delay in MGNREGS Funding and Impact on Rural Workers

• MGNREGS Background
  • The Mahatma Gandhi National Rural Employment Guarantee Scheme (MGNREGS) provides employment to rural workers for 100 days every year.
  • However there has been an acute funding shortage in the financial year 2024-25, which is causing a delay in wage payment.
• Budget Shortfall and Delayed Payments
  • Wages shortfall for the Rural Development Ministry stands at 4315 crore hence there is a delay in the disbursement of payment to the workers.
• Section 3(3)
  • According to Section 3(3) of the MGNREG Act wages should be paid weekly or within two weeks of the completion of the work.
• Material Component Funding
  • The Centre is also behind in granting 5715 crore for material components which the Centre bears 60 of the cost and states bear 40.
• Cascading Effects
  • The delay in material component has its effect on the supply chain since vendors are hesitant to deliver raw materials that further stall the works of the current projects.

 Governments Budgeting and Allocation Practices

• No Additional Allocation
  • The Union government has not provided additional funds for MGNREGS in the 2024-25 Budget despite the deficit.
• Past Precedents
  • In the past, additional funds were allocated as and when required For instance in 202021 when the pandemic and reverse migration happened the allocation was increased from 61,500 crore to 1,11,500 crore.
• Governments Stand
  • On this basis, the government argues that its budgetary approach is right in so far as MGNREGS is a demand driven scheme and extra allocations are made only when needed.

Experts Objection Schemes

• Implementation
  • There have been experts and activists on the view that the meager allocation artificially depresses demand for employment under the scheme since the amount does not meet the real demand.
• Findings of Parliamentary Standing Committee
  • A report by the Parliamentary Standing Committee on Rural Development has expressed the opinion that reduced allocation affects wage payments in time and also release of materials badly, affecting the schemes execution.

Mahatma Gandhi National Rural Employment Guarantee Act ( MGNREGA )

6. Chronic Pulmonary Aspergillosis (CPA)

Context:

The Threat of Chronic Pulmonary Aspergillosis is rising rapidly among the Assam’s Tea Workers.

Chronic Pulmonary Aspergillosis (CPA)

Chronic Pulmonary Aspergillosis (CPA) is a life threatening fungal infection caused by Aspergillus fumigatus. It’s a progressive disease that can affect people with healthy immune systems. CPA is often found in people with other lung conditions, such as tuberculosis, sarcoidosis, or cystic fibrosis. It predominantly affects individuals with immunodeficiency such as tuberculosis (TB) survivors.

• High Prevalence in Assam Tea Gardens
  • Tea garden workers in Assam have been particularly affected with a prevalence rate of 217 per 100000 population based on the National TB Prevalence Survey 2019-2021.
  • High risk factors were identified as poverty, poor nutrition, exposure to kitchen smoke and proximity to other family members suffering from this disease.

Recommendations and Awareness Campaigns

• Training Healthcare Providers
  • The researchers urged training for healthcare workers to recognize the symptoms of CPA so early diagnosis can improve more in tea garden and TB hospitals.
• Education Campaigns
  • Education of workers about respiratory health nutrition and hygiene should be emphasized to reduce the risk of respiratory diseases.
• Nutrition and Health Risks
  • The report also mentioned a two year old epidemic dropsy report due to the toxic Argemone mexicana poppy that contaminates edible oils It adds to the health risks in Assam.

Banking/Finance

1. Multi-Asset Allocation Fund

Context:

Multi-asset allocation funds, which gained traction following the shift in debt fund taxation in April 2023, continued their upward trajectory in 2024, with assets under management (AUM) nearly doubling during the year.

Multi-Asset Allocation Fund

A “Multi Asset Allocation Fund” is a mutual fund that invests in a mix of different asset classes like equity, debt, gold, real estate, and commodities, with the objective of diversifying an investor’s portfolio and reducing overall risk by spreading investments across various markets that may react differently to economic changes; essentially, it allows investors to gain exposure to multiple asset types through a single fund, managed by a professional fund manager who adjusts allocations based on market conditions.

Key Points

• Diversification
  • Multi asset funds come with a huge advantage of risk diversification. By spreading investments across several classes of assets the fund has to build stability more so during market fluctuations. This diversified exposure may help in minimizing the potential impact of poor performance of one class of assets.
• Hybrid Nature
  • Multiasset funds are usually categorized under hybrid funds. They vary between different kinds of assets by blending equities, bonds, commodities, and much more into a single portfolio, which makes them more versatile with changing market conditions.
• Allocation Flexibility
  • Such funds have flexibility in asset allocation. The proportion between various asset classes could be changed with respect to specific fund and the needs of investor. This is what allows an investor to select a mix based on his personal tolerance for risk as well as personal objectives while investing.

Few Examples of the Asset Classes Incorporated

• Equity Stocks
  • Exposure of the performance by companies and overall market growth.
• Bonds
  • Generates income in the form of interest payments with lower volatility.
• Gold
  • An inflation hedge and store of value REITs Investments in real estate, properties and associated assets.
• Commodities.
  • Those include physical assets like oil and gas and agricultural products.

2. SBI’s Global Ed-Vantage Scheme

Context:

SBI has increased the limit for collateral free education loans under its Global Ed-Vantage scheme from 7.5 lakh to 50 lakh. This is for students admitted to select international universities and institutions.

SBI’s Global Ed-Vantage Scheme

The SBI Global Ed-Vantage scheme is an education loan by the State Bank of India (SBI) for a student who wishes to pursue higher education abroad. It covers the amount for pursuing a full-time course at a foreign university or college.

• Launch
  • April 5, 2024. 

Key Features of the Scheme

• Eligibility
  • Those students who wish to pursue full time studies abroad at universities or colleges are eligible for this loan.
• Repayment
  • EMI (Equated Monthly Installment) repayment begins six months after the completion of the course.
• Interest Rates
  • The SBI Global Ed-Vantage loan comes with a flat interest rate with no additional hidden charges.
• Benefits of education loans
  • Tax benefits: The interest paid on an education loan is eligible for tax relief under Section 80E of the Income Tax Act of 1961.
  • Moratorium period: Education loans have a moratorium period until the student finishes his studies.
  • Credit history: A student can enhance his credit history by making regular loan repayments.

Key Benefits of the Initiative

• Access for Economically Constrained Families
  • Collateral demand has been an important hindrance for students with assetless backgrounds to pledge it as security.
  • This will decrease the student loans with low collateral.
• Options of No Collateral Loans
  • Even Nonbanking financial companies (NBFCs) have provided high-value non collateral loans to those students from good rated colleges and creditworthy students who get good ratings.

Student Loans Problems Education Loans

• Interest Rate
  • Collateral free loans have high interest rates, processing fees and other hidden charges. Students are advised to compare loan options across lenders and negotiate rates if admitted to reputed institutions.
• Collateral Requirements
  • Many students struggle in terms of meeting collateral requirements most especially those that come from the middle class and from the lower class who do not have assets, or any property to gold.
• Undervaluing or Overvaluing the Loan Amount
  • Either over or underestimation in terms of the amount needed for loans may happen. That is why calculations regarding tuition, living costs and miscellaneous expenses, need to be very accurate in its computation.
• Margin Money
  • The banks may require a margin of 1025 of the entire cost In this different expenses such as application fee for visa health insurance and dwelling are paid.
• Loans for Non STEM Courses
  • Loans for non STEM courses or for students of lower-ranked universities could be issued at a higher rate of interest with stricter collateral and margin calls.
• Documentation and Processing
  • Number of papers needed to give loan application for admission proof academic reports KYC and the applicant along with salary slip of co-applicant.

3. RBI Ombudsman Annual Report

Context:

The Reserve Bank of India (RBI) has announced its intentions and strategies to conduct an evaluation and strengthen consumer education and protection in the retail credit sector. The move comes as the complaints about retail loans have risen sharply, especially at a time when the retail credit market is seeing explosive growth.

Retail Credit

Retail credit is the aggregate of consumer credit products and services, comprising loans, credit cards, and mortgage banking. Also, it incorporates business-to-business and business-to-consumer financing.

What are retail credit products and services?

• Credit cards
  • This is one form of retail credit product.
• Mortgages
  • This is also one type of retail credit product.
• Residential lending
  • This is one more type of retail credit product.
• Personal loans
  • A type of retail loan that can be used for a variety of personal expenses.

What are retail credit facilities?

• A type of loan or line of credit that can be used by retailers and real estate companies.
• A financing method that can provide capital for business needs or customer lending.
• A versatile financial instrument that can be structured with different types of debt.

Benefits of Retail Credit Facilities

• They can avail liquidity for numerous purposes.
• They may help to take care of operationary requirements.
• They may avail services of extending loan services.
• They may availed to arrange the credit account in a well-presentation format.

Key Highlights of RBI Annual Report FY24

• Low Complaint Levels Survey
  • The CEPD would conduct a survey in FY25 to find out why the complaints from the rural and semiurban areas are relatively on the lower side that may indicate that redressal mechanism is not yet known to many.
  • It will be upgradation based on the survey conducted on the complaint management system of RBI with greater consistency in the decisions and the outcome.

• Complaints Rise
  • In FY24, the RBI Ombudsman and the Centralised Receipt and Processing Centre (CRPC) received 9,34,355 complaints that is a 3281 increase from the previous year. This means increased concerns on customer service and complaint handling in the banking sector.
  • Complaints about retail credit especially unsecured loans account for a big portion of this increase which means a call for better protection mechanisms.

Retail Credit Landscape Problems

• Usurious Interest Rates
  • Interest rates applied on loans have been termed by experts as usurious due to the surge in retail credit amongst low credit scoring customers. This poses a problem to new credit seekers.
  • Retail lending comprises credit cards and personal loans, which are becoming gruelingly pricey. A huge proportion of the populace are facing expensive interest rates as well as fee costs.
• Consumer Protection Gaps
  • There is a lacking dedicated body for mediating consumer disputes in the credit sector Even though the Banking Codes and Standards Board of India (BCSBI) used to fill this role it was dissolved in 2011, thus leaving a vacuum in the advocacy of consumers in retail lending.

 Retail Credit Growth and Consumer Distress

• Retail Credit Growth
  • The growth of retail credit is causing much concern as far as its ability to place consumers in bad financial behavior particularly with high levels of borrowing and the use of personal loans for speculative activities such as investing into IPOs.
  • The retail loan portfolios experience significant write offs and particularly unsecured ones may raise suspicion of substandard lending practices such as dilution of underwriting standards
• Concerns with Fintech Lending
  • Fintech lending has raised new issues. On one hand, fintechs have made loans accessible to young borrowers, but on the other hand, they also pose risks due to usurious rates and the fact that many of these borrowers are fresh to credit.
  • The Fintech Association for Consumer Empowerment reports that volumes of fintech loans have fallen though the segment still accounts for a substantial portion of credit to younger less experienced borrowers.

4. RBI’s Monetary Policy Committee Meeting

The next RBI Monetary Policy Committee meeting is scheduled from February 5-7, 2025, as part of the FY 2024-25 schedule.

Inflation and GDP Growth

• CPI Inflation
  • Average headline CPI inflation during Q3 of 2024-25 was at 56 which is comfortably above the target but in line with RBIs base estimate.
• GDP Growth
  • The growth in real GDP is expected to be at 64 during 202425 and thus well in line with the RBI forecast of 66.

Given that inflation and GDP growth outcomes have been in line with expectations the MPC will consider risks to inflation and growth in deciding the way forward.

Inflation Risks and External Pressures

• Rupee Depreciation
  • The rupee has depreciated by more than 3 primarily due to renewed dollar strength and increased financial market volatility. This is an upside risk to inflation especially as the US Federal Reserve signals fewer rate cuts in 2025.
• Inflation Outlook
  • RBI expects to see the headline inflation high even at 4 for the following six months and hence in the 455 band. Food inflation remains high but is getting better but core inflation seems to be sticky.
• Imported Inflation
  • Imported inflationary pressures are seen to have potential downsides on account of the fall of the rupee and general globalization dynamics.
• GDP Growth
  • During the second half of the year growth is likely to pick up based on private consumption. Real GDP growth for the year 2024-25 would come in lower compared to the previous year at 82 percent. However, nominal GDP growth is likely to remain at 97 percent which is similar to the previous year.
• Capital Expenditure
  • The attention of the Centre at capital expenditure along with fiscal consolidation would support growth in the medium term although the slowing down of capital spending has reflected in headline growth.
• Private Consumption
  • Rural demand is recovering supported by improved agricultural activity while the urban demand finds support in the stable growth in services.
• Policy Prudence
  • In the wake of increased inflation risk and reasonable prospects of growth the MPC may choose not to change policy rates and to maintain status quo but support growth while also containing inflationary push.
• Liquidity Management
  • The Reserve Bank of India (RBI) has been guiding the liquidity condition more so through variable rate repo auctions (VRR), cut in cash reserve ratio (CRR) by 50 basis points in December.
• Liquidity Shocks
  • A sustained liquidity shortage can force up short-term interest rates, which may nullify the stimulus effect of any policy rate cuts in the future. Adequate provision of liquidity will be indispensable to underpin the operating effectiveness of future monetary policy.

Economy

1. RBI Policy Change on MSME Financing

Industry Issues

• Problem Statement
  • Industry associations for micro small and medium enterprises MSMEs have sought the Reserve Bank of India (RBI) to treat credit availed by banks to nonbanking financial companies (NBFCs) for on lending to MSMEs as priority sector lending (PSL).
• Ceiling on Borrowing
  • They have also demanded that RBI must remove or at least raise the present 20 lakh borrowing ceiling of each MSME to at least 1 crore.

Background History of RBIs Policy

• 2011
  • With effect from April 1, 2011, RBI withdrew its decision of treating the loans given by NBFCs to MSEs as on-lending as part of the Priority Sector Lending. Thus funding for MSEs became much more less.
• Impact on NBFCs
  • The withdrawal of funds by banks has brought financial hardship for most of the NBFCs, which had, in the past, provided working capital to MSMEs.

Priority Sector Lending (PSL) Classification for NBFCs

• Renovation of PSL Categorisation
  • RBI revamped PSL categorisation partly but only in loan up to 20 lakh per borrower only.
• Liquidity Crisis
  • The said partial revamping has also failed to mitigate the increasing MSEs funding needs due to restrictions under the capping that constrict the opportunities for NBFCs to fully help MSEs again.

Priority Sector Lending (PSL) for Scheduled Commercial Banks (SCBs)

• PSL Expansion
  • By March 31 2024, PSL was 451 of adjusted net bank credit of SCBs PSL exceeded the 40 target set for FY24.
• YoY Growth
  • YoY growth in PSL during FY24 was at 169 higher than 108 recorded during FY23. The private sector bank and public sector bank grew at 235 and 123 respectively.

Non Performing Assets in Priority Sector Lending (PSL)

• PSL NPAs
  • Gross NPA ratio for PSL was reduced to 44 in March 2024 from 54 in March 2023.
• Priority Sector NPAs
  • The absolute NPAs have declined. However the share of priority sector NPAs of the overall NPA of SCBs has increased to 573 mainly due to agricultural slippages.

MSME Investment and Turnover Limits

• Micro enterprises
  • Investment in plant and machinery / equipment Rs 1 crore turnover Rs 5 crore.
• Small enterprises
  • Investment in plant and machineryequipment 10 crore turnover 50 crore.
• Medium enterprises
  • Investment in plant and machinery equipment 50 crore turnover 250 crore.

2. The Union Budget and RBI’s Monetary Policy

Context:

The Union Budget and RBI’s monetary policy are two of the most significant events in India’s economic calendar which usually come at the end of February. These shape the fiscal and monetary profile of the country reflecting the strategies of the government and the RBI for pushing growth taming inflation and maintaining fiscal responsibility.

Union Budget FY26

On February 1, 2025 it will set the fiscal tone for the next year and is likely to focus on fiscal consolidation and growth stimulation.

• Monetary Policy Committee (MPC) Meeting
  • The last MPC meeting of FY25 by RBI will be on February 7, 2025 and is likely to influence interest rates and monetary policies to control inflation and stimulate growth.

Fiscal Deficit and Economic Growth

• Fiscal Deficit Target FY25
  • Fiscal deficit is anticipated to be 4.8% of GDP marginally lower than the targeted 4.9%.
• Economic Growth
  • India’s GDP growth has decelerated and the Q2 FY25 growth declined to 54 from 81 in Q2 FY24. Deceleration in all major sectors other than agriculture and services reflects the economic slowdown

Obstacles to Economic Growth

• Weaker Consumer Demand
  • Consumption growth is slowing down and forex reserves have declined from 7,049 billion in September 2024 to 62,398 billion in January 2025.
• FDI and Portfolio Investment
  • FDI inflows have declined falling from 42 billion in FY23 to 265 billion in FY24. Foreign portfolio investors are also withdrawing capital from the Indian markets which shows a decline in foreign confidence in the market.
• Rupee Depreciation
  • Rupee continues to depreciate against the dollar and is putting immense pressure on the economy.

The Requirement of Reforms and Growth Revitalization

• Personal Income Tax
  • There has been some murmur that even personal income taxes may be trimmed to help grow disposable incomes as well as push demand.
• Corporate Tax Cuts
  • Previous reductions in corporate tax rates have not led to any significant surge in investments since corporations mainly used the saved amount for paying off debts. It is very hard to develop a system that supports actual investment and capacity building.
• GST Reforms
  • The GST system needs to be streamlined further especially not to make rules on minor products such as popcorn a bottle neck for overall efficiency in the economy.

Privatisation and Disinvestment Opportunities

• Disinvestment of PSUs
  • The government could not seize the privatization of stateowned public sector undertakings PSUsand thereby misses the opportunity to source capital.
• Privatisation
  • Privatisation of IDBI Bank and the stakes of the government in PSU banks are still pending. However this is with promising performances of PSU companies like Indian Overseas Bank.
• Divestment Strategy
  • The governments divestment strategy could generate revenue but its lack of action in privatizing profitable public companies has raised concerns. Privatization of PSUs could help fund important capital expenditure initiatives to spur growth.

Conclusion

The Union Budget FY26 and RBIs monetary policy are critical in navigating India through its current economic slowdown. The government needs to focus on stimulating growth particularly through reforms and an accelerated capex push In parallel a more aggressive approach to privatisation and divestment could free up capital for reinvestment in critical sectors. Without these measures the fiscal deficit and sluggish growth might continue to pose significant challenges.

Agriculture

1. Nano Urea

Urea is a widely available nitrogen-based fertilizer, while nano urea is the newer nanotechnology-based urea in which the nitrogen particles are much smaller than those in urea. This means the plants can absorb more of them, which may lead to lower environmental effects and possibly better crop yields as compared to regular urea. In short, nano urea is a highly concentrated and exactly delivered form of nitrogen to the plants.

• Urea
  • A widely used chemical fertilizer with a high nitrogen content.
  • Can be applied to the soil as granules or liquid
  • If not applied with proper techniques, this may cause nitrogen loss through leaching and volatilization.
• Nano Urea
  • This makes use of nanotechnology where urea is broken down into tiny particles increasing the surface area to better allow the absorption by plants.
  • It can be applied by foliar spray and direct uptake by the leaves.
  • Claimed to be more efficient in delivering nitrogen to plants, reduce environmental pollution from fertilizer overuse.

Nano Urea

• What is Nano Urea?
  • Liquid nitrogen fertilizer developed by IFFCO in 2022 marketed as a cheaper substitute for regular urea.
• Key Claim
  • A 500 ml bottle of nano urea can replace 52 kg of regular urea, when sprayed at critical growth stages thus reducing aggregate urea consumption and import bills.
• Application
  • Method Nano urea is sprayed on the leaves at the flowering stages as opposed to traditional urea that is applied directly to the soil.

Key Findings of the Study

• Decline in Crop Yields
  • Paddy and wheat yields accounting for 70 of India’s annual food grain production declined in the presence of nano urea Protein content in grains declined by 35 in rice and 24 in wheat.
• Low Efficiency
  • Plants were unable to use most of the nitrogen from nano urea sprays. Instead it used the majority of nitrogen coming from soil.
  • Reduction in root characteristic length and dry weight that impacts uptake of nutrients.
• Economic Impacts
  • Early adoption may result in permanent yield loss, reduced grain quality and economic loss to farmers.

Nano Urea Issues

• Conflicting Findings
  • While IFFCOs earlier experiments were successful independent experiments revealed that the results were not consistent.
• New Variants
  • IFFCO is working on variants containing 8 and 20 nitrogen content but there is no evidence of improved yield.
  • India needs 350 lakh tonnes of urea every year of which it imports 40 lakh tonnes.
  • Subsidized urea is sold to farmers at 242 per 45kg bag though the government pays more than 3000 to produce it.

Conclusion and Recommendations

• Long term comprehensive assessments are required before nanourea can affect yields and improve soil health. This would be prejudicial to livelihoods of Indian farmers and Indian food security through largescale and early adoption.
• Focus Areas for Future Research should comprise better optimization of formulations improved uptake of nitrogen and less reduction in yield.

Nano Coated Fertilisers

Facts To Remember

1. Seven get Padma Vibhushan, 19 named for Padma Bhushan

Gastroenterologist D. Nageshwar Reddy, Kathak dancer Kumudini Rajnikant Lakhia, and violinist L. Subramaniam were among the Padma Vibhushan winners. Iconic writer M.T. Vasudevan Nair, Japan’s Suzuki Motor leader Osamu Suzuki, and Bhojpuri and Maithili singer Sharda Sinha have been named for Padma Vibhushan posthumously.

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2. Two Kirti Chakras, 14 Shaurya Chakras in 93 Gallantry Awards

The President of India and Supreme Commander of the Armed Forces, Droupadi Murmu, has approved two Kirti Chakras, one of them posthumous, and 14 Shaurya Chakras, three of them posthumous, in a total of 93 gallantry awards to personnel of the armed forces and Central Armed Police Forces (CAPF) on the eve of the 76th Republic Day. Eleven awards are posthumous.

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3. Sreejesh chosen for Padma Bhushan, Ashwin for Padma Shri

Former men’s hockey captain P.R. Sreejesh was chosen for the Padma Bhushan while recently retired cricketer R. Ashwin was among the Padma Shri winners as four athletes and a para-coach figured in the list of 139 finalised for the awards.

4. Cardiac surgeon K.M. Cherian passes away at 82

India’s renowned cardiac surgeon K.M. Cherian, who performed the country’s first coronary bypass surgery, passed away in Bengaluru at age 82. His son, shared that Dr. Cherian collapsed after attending a wedding reception.

5. Covid-19 most likely originated from China lab: CIA

The CIA now believes the virus responsible for the Covid-19 pandemic most likely originated from a laboratory, according to an assessment released Saturday that points the finger at China even while acknowledging that the spy agency has “low confidence” in its own conclusion.

6. 76th Republic Day Parade Features

• The Pralay quasi-ballistic missile system being displayed during the 76th Republic Day parade on Kartavya Path in New Delhi on Sunday. 

• The parade features key missile systems, including BrahMos supersonic cruise missiles, upgraded Pinaka Multi-Rocket Launch System, BM-21.

• Grad MRLS, and the Pralay quasi-ballistic missile system; the new Battlefield Surveillance System, Sanjay, was showcased for the first time.