Source: TNIE Context: The Life Insurance Corporation of India (LIC) has launched two new life insurance plans aimed at providing savings and risk coverage to individuals and their families. Key Features:
RBI Cuts Repo Rate to 5.25%
Source: Mint Context: The Reserve Bank of India (RBI) reduced the repo rate by 25 basis points (bps) to 5.25%, citing a rare macroeconomic situation where growth is strong and inflation is exceptionally low. The move surprised sections of the market that expected the Monetary Policy Committee (MPC) to hold rates. Why the Repo Rate Was Cut 1. Benign and Rapidly Falling Inflation 2. Robust GDP Growth 3. Policy Space + Low Inflation = Opportunity Governor Sanjay Malhotra termed this a “rare goldilocks period” where inflation is low and growth is stable, enabling policy action to support momentum. Impact of the Repo Rate Cut 1. Impact on Banks 2. Impact on Borrowers 3. Impact on Economy 4. Impact on Inflation What is Repo Rate? Repo Rate is the rate at which the RBI lends short-term money to commercial banks against government securities. Why Repo Rate Matters What is Reverse Repo Rate? Reverse Repo Rate is the rate at which commercial banks park their surplus funds with RBI. Why It Matters
Exercise Garuda and Exercise Garuda Shakti
Context: Two major military exercises were recently in focus: These exercises aim to strengthen bilateral defence cooperation, enhance interoperability, and expose forces to advanced operational tactics. Exercise Garuda 25 Exercise Garuda Shakti 2025
BNHS to Release Critically Endangered Vultures in Assam
Source: TH Context: The Bombay Natural History Society (BNHS) will release six critically endangered vultures—slender-billed (Gyps tenuirostris) and white-rumped (Gyps bengalensis)—into the wild in Assam in January 2026. This is part of India’s ongoing vulture recovery programme, aimed at conserving these species that have faced severe population declines over the past two decades. Slender-billed Vulture (Gyps tenuirostris) White-rumped Vulture (Gyps bengalensis)
Shift in Stubble-Burning Timing in Punjab and Haryana: ISRO
Source: IE Context: A new ISRO study has revealed that peak stubble-burning activity in Punjab and Haryana has shifted from early afternoon to early evening between 2020 and 2024, resulting in possible underestimation of farm-fire incidents by government data that rely mainly on polar-orbiting satellites. Key Findings from the ISRO Study Government Monitoring and Enforcement Impact on Farm-Fire Incidence
DHRUVA (Digital Hub for Reference and Unique Virtual Address)
Source: TH Context: The Department of Posts has released a draft amendment in 2025 proposing DHRUVA (Digital Hub for Reference and Unique Virtual Address), a UPI-like digital addressing system. This system aims to digitise, standardise, and virtualise physical addresses across India, allowing users to share secure, consent-based address “labels” such as name@entity. Key Features of DHRUVA UPI-Like Address Labels Consent-Based Access DIGIPIN Backbone Address-as-a-Service (AaaS) Framework Aim of DHRUVA
RBI Allows Multiple Bank-Group Entities to Undertake Same Business, With Board Approval
Source: BS Context: The Reserve Bank of India (RBI) has allowed multiple entities within a bank group to undertake the same line of business, provided they cater to different customer segments and obtain mandatory board approval to justify any overlap. Key Announcement RBI has modified its earlier proposal to restrict a bank group to one entity per business activity. Now: This change provides greater operational flexibility to banks while ensuring governance discipline. Why Did RBI Make This Change? RBI accepted the suggestion but added a governance check through mandatory board approval. Background: 2024 Draft Circular The draft regulatory framework (2024) had proposed: New Relief for NBFC Group Entities of Banks Exemption from Listing Requirement RBI accepted industry demand to ease listing norms. Why This Matters Under the Scale-Based Regulatory (SBR) framework: Anti-Circumvention Clause To prevent banks from bypassing regulations by shifting activities to NBFC subsidiaries: Current NBFC-Upper Layer (NBFC-UL) Largest NBFCs regulated similar to banks. Examples include:
RBI Examining Bank Participation in Non-Agricultural Commodity Derivatives
Source: BS Context: The Reserve Bank of India (RBI) is reviewing a proposal by SEBI to allow banks to participate in non-agriculture commodity derivatives markets. RBI Governor Sanjay Malhotra clarified that current regulations under the Banking Regulation Act prohibit banks from such activities. Key Points: What Are Non-Agricultural Commodity Derivatives? Non-agricultural commodity derivatives are exchange-traded financial contracts whose value is derived from non-farm commodities such as metals, energy products, and bullion. These instruments allow participants to hedge price risks, speculate, or manage exposures in non-agri commodities. They are traded on Indian commodity exchanges such as:
Open Market Operation (OMO)
Context: The RBI announced a ₹1 trillion Open Market Operation (OMO) purchase along with a $5 billion dollar–rupee swap to inject durable rupee liquidity as the rupee slipped past 90 per dollar amid foreign outflows. The move aims to stabilise liquidity, interest rates, and currency markets. What is an OMO Purchase? An Open Market Operation (OMO) purchase is an action where the RBI buys government securities from banks and financial institutions to inject durable liquidity into the financial system.Key outcomes: Purpose of OMO Purchases Types of Open Market Operations Expansionary OMO (Liquidity Injection) Contractionary OMO (Liquidity Absorption) Special OMOs / Operation Twist How OMO Purchases Work Step 1: Assess Liquidity RBI monitors: Step 2: Announce OMO Auction RBI specifies: Step 3: Banks Sell Bonds Banks sell government securities to the RBI through the auction mechanism. Step 4: Settlement Step 5: Market Effects Significance of the OMO Purchase
Exercise Harimau Shakti 2025
Source: PIB Context: India and Malaysia have commenced the 5th edition of Exercise Harimau Shakti 2025 at the Mahajan Field Firing Range, Rajasthan, focusing on enhancing coordination in counter-insurgency and peacekeeping operations. What is Exercise Harimau Shakti? Exercise Harimau Shakti is a bilateral military training exercise between the Indian Army and the Royal Malaysian Army. The exercise aims to strengthen cooperation, tactical coordination, and operational readiness in sub-conventional warfare and UN peacekeeping missions. Participating Nations Key Features of the Exercise Focus on Sub-Conventional Operations Joint Tactical Drills Operational Readiness & Combat Skills Exchange of Best Practices Both armies share tactical knowledge and warfighting techniques to enhance collective proficiency and mission preparedness.
