Current Affairs July 2025

Daily Current Affairs Quiz
1 July, 2025

National Affairs

1. Special Intensive Revision (SIR) of Electoral Rolls in Bihar – 2025

Context:

India’s electoral system is widely praised for enabling high participation by the poor and marginalised, unlike many Western democracies. However, the Election Commission of India’s (ECI) recent move to conduct a Special Intensive Revision (SIR) of electoral rolls in Bihar ahead of the October 2025 Assembly elections has sparked concerns about voter exclusion due to procedural and documentary barriers.

What is Special Intensive Revision (SIR)?

Special Intensive Revision (SIR) is a comprehensive, door-to-door verification of houses process to update and verify electoral rolls.

Constitutional Provisions

• Article 326 of the Constitution:
  • Eligibility: Indian citizen, ≥18 years, not disqualified under any law, and ordinarily resident in the constituency.
• Article 324: Empowers ECI to supervise and conduct elections.
• Section 21 of RP Act, 1950: Allows revision of electoral rolls.
• Section 16 of RP Act, 1950: Specifies disqualifications for registration.
• Section 23 & 24 of RP Act, 1950:
  • Section 23: Verification of documents for eligibility
  • Section 24: Appeal provision to District Magistrate and CEO

Why SIR in Bihar?

• Last intensive revision: 2003 (with 01.01.2003 as qualifying date)
• New Qualifying Date: 01.07.2025
• Reasons for SIR:
  • Rapid urbanisation and migration
  • Rise in eligible youth voters
  • Underreporting of deaths
  • Risk of inclusion of foreign/illegal voters
• Objective: Ensure accuracy, integrity, and transparency of electoral rolls

Objective of SIR

• Ensure transparency, inclusivity, and accuracy in electoral rolls.
• Facilitate registration of:
  • Elderly
  • Persons with Disabilities (PwDs)
  • Poor and vulnerable populations
• Reinforce voter integrity and trust in the electoral process.

PIB & TH

2. NITI Aayog’s US Trade Proposal: A Risk to India’s Food Security?

Context:

A recent NITI Aayog paper recommends significant tariff cuts on key US agricultural imports—rice, dairy, poultry, corn, apples, almonds, and genetically modified (GM) soya—under the proposed India-US Free Trade Agreement (FTA). However, experts warn these moves could critically undermine India’s food security, farmer incomes, and trade sovereignty.

Key Recommendations and Criticisms

• Rice Tariff Elimination: A Dangerous Precedent
  • NITI suggests scrapping tariffs on US rice, citing India’s rice export surplus.
  • Critique: Historical lessons from the PL-480 era (1960s–70s) and GATT rounds show that prematurely locking low tariffs can lead to long-term vulnerabilities.
• Vulnerability to Global Price Volatility
  • The paper ignores risks of global grain price crashes (like in 2014–2016) and price spikes (2005–2008, 2010–11).
  • Without tariffs, cheap US subsidised grains could flood Indian markets, discouraging local production.
• Undermining India’s WTO Position
  • Removing rice tariffs may reward US trade lobbies that consistently challenge India’s MSP and procurement policies at the WTO.
  • For example, the USA Rice Federation has accused India of distorting global markets through its subsidy system.

Genetically Modified Imports

GM Corn and Soya: Containment Unrealistic

• Recommends importing:
  • GM corn byproducts (DDGS) for animal feed (re-export model).
  • GM soybean seeds for coastal crushing under a “controlled” model.
• Critique: India’s fragmented supply chains and poor enforcement make GM contamination likely, risking:
  • Domestic food chain pollution.
  • Export bans from countries rejecting GMOs.

Why This Matters

Strategic Autonomy and Rural Stability

• The paper underestimates:
  • India’s reliance on tariff flexibility to manage food price shocks.
  • The fragility of rural incomes and the scale of agrarian employment (700+ million people).
• Tariff flexibility is not outdated protectionism—it is a vital tool to:
  • Stabilize domestic markets,
  • Insulate small farmers from subsidized imports,
  • And safeguard food security.

Need for Democratic Consultation

• Any decision to liberalise the farm sector under FTA must involve:
  • State governments
  • Farmer organizations
  • Independent experts

BS

3. QUAD Launches First-Ever ‘QUAD at Sea Ship Observer Mission’

Context:

The Coast Guards of India, Japan, the United States, and Australia have launched the first ‘QUAD at Sea Ship Observer Mission’. Conducted under the Wilmington Declaration, this is the first cross-embarkation mission involving two officers (including women) from each QUAD nation. The officers have embarked on board the US Coast Guard Cutter (USCGC) Stratton, currently route to Guam.

Strategic Significance

• Enhances:
  • Maritime interoperability
  • Joint operational readiness
  • Domain awareness in the Indo-Pacific
• Supports the QUAD’s vision of a Free, Open, Inclusive, and Rules-Based Indo-Pacific.
• Aligns with the QUAD Leaders’ Summit (September 2024) commitment to deeper maritime cooperation.

India’s Role & Strategic Vision

• Reinforces India’s SAGAR doctrine: Security and Growth for All in the Region.
• Complements India’s Indo-Pacific Oceans Initiative (IPOI) pillars, especially:
  • Capacity building
  • Humanitarian assistance
  • Maritime rule of law
• Promotes the concept of a ‘QUAD Coast Guard Handshake’ — aimed at trust-building and collective maritime resilience.

The Indian Express

Banking/Finance

1. GST 2.0

Context:

As the Goods and Services Tax (GST) completes eight years of implementation on July 1, tax experts acknowledge its successes but say a lot more work needs to be done in terms of simplification and rationalisation of rates. 

Achievements So Far

• GST replaced a complex, multi-state indirect tax system.
• Brought uniformity in tax treatment across States.
• Improved compliance via digitisation and e-invoicing systems.

Key Reforms Suggested (GST 2.0)

Inclusion of Fuel and Electricity in GST

• Items like petrol, diesel, ATF, natural gas remain outside GST.
• Their inclusion would:
  • Reduce tax cascading
  • Ease cash flow issues for sectors like transport, logistics, oil & gas
• Inclusion requires GST Council approval

Rate Rationalisation:

• Current system: Five major slabs – 0%, 5%, 12%, 18%, 28%
  (plus special rates: 0.25%, 1%, and 3%)
• Suggestion: Reduce to fewer slabs for simplicity and efficiency
• Rationalisation will aid compliance and reduce classification disputes

Minimising Input Tax Credit (ITC) Restrictions:

• Multiple ITC restrictions have caused confusion and litigation.
• Experts call for a more liberal and transparent ITC mechanism

Streamlining Audits and Dispute Resolution:

• Absence of a GST Appellate Tribunal (GSTAT) delays resolution of appeals.
• High pendency of GST-related cases
• PwC recommends revisiting dispute resolution frameworks for faster redressal

Addressing Procedural Hassles:

• Procedural complexity and litigation on minor issues overshadow compliance efforts.
• Need to simplify:
  • Audit norms
  • Return filing
  • Compliance mechanisms

TH

2. RBI Financial Stability Report (FSR) – June 2025

Context:

The June 2025 FSR presents the RBI’s biannual assessment of systemic risks and financial sector resilience in India. Released against a backdrop of rising global economic and geopolitical uncertainty, the report strikes a cautiously optimistic tone on India’s macro-financial stability but flags key vulnerabilities.

Key Takeaways

Global Risks and India’s Exposure

• External headwinds from trade policy conflicts, geopolitical tensions (e.g., Middle East), and volatile capital flows have intensified.
• A 100 bps slowdown in global growth could shave off 30 bps from India’s GDP growth.
• Financial markets remain highly sensitive to interest rate signals and debt sustainability concerns, especially in advanced economies.

Macroeconomic Fundamentals Remain Strong

• India’s GDP is projected to grow steadily at 6.5% in FY26, supported by rural consumption, infrastructure spending, and corporate deleveraging.
• Inflation is well-contained, with food prices softening and imported inflation risks minimal due to stable crude prices.
• Current Account Deficit (CAD) remains manageable and forex reserves are robust, providing external sector stability.

Banking Sector: Strong but Watchful

Capital and Profitability

• Banks are well-capitalised: CRAR remains comfortably above regulatory norms, even under severe stress scenarios.
• Profitability metrics like Return on Assets (RoA) and Return on Equity (RoE) have improved, aided by higher operating efficiency and lower provisioning needs.

Asset Quality

• GNPA and NNPA are at multi-decade lows.
• However, RBI’s stress tests show potential rise in GNPA to 5–6% by 2027 under adverse scenarios.
• The most vulnerable segments are:
  • Unsecured personal loans
  • Retail credit in Tier-III cities and youth borrowers
  • Private sector banks with higher exposure to risky segments

Credit Growth Deceleration

• Bank credit growth has slowed sharply, driven by:
  • Tighter risk-weight norms on personal loans and NBFC exposure.
  • Cautious lending approach amid rising delinquency signals.

Liquidity and Cost of Funds

• Banks face pressure on Net Interest Margins (NIMs) due to:
  • A higher share of EBLR-linked loans which reprice rapidly.
  • Increasing reliance on high-cost term deposits and CDs, eroding margins.
• The CRR cut by 100 bps has helped offset some of this pressure.

NBFCs, Mutual Funds, and Insurance: Mixed Signals

NBFCs

• Continue to show capital adequacy and profitability.
• Stress is emerging in personal loan portfolios, especially fintech-driven, low-ticket lending.

Mutual Funds and Clearing Corporations

• Stress tests show resilience, though market volatility remains a concern.
• Regulatory tightening includes stricter disclosure, monitoring, and cyber resilience measures.

Insurance Sector

• Maintains solvency well above the regulatory minimum.
• Digitisation of premium payments and growing penetration of NPS/APY has strengthened long-term sectoral depth.

Corporate Bond Market

• India’s bond market saw a record ₹9.9 trillion in fresh issuances in FY25.
• However, secondary market activity remains subdued, limiting market depth.
• Credit spreads widened marginally due to liquidity constraints and global risk sentiment, despite softening yields.

Regulatory & Institutional Developments

• RBI and other regulators are aligning with global standards:
  • Digital Lending Norms to improve borrower protection and app transparency.
  • Cybersecurity frameworks like FIRE and MNRL for robust threat monitoring.
  • SEBI reforms in derivatives, investor grievance redressal, and FPI regulation.
  • Deposit insurance coverage now spans 97.6% of accounts.
  • Significant activity in GIFT City, enhancing India’s offshore finance capacity.

Risks and Outlook

Emerging Concerns

• Rising delinquency in unsecured retail loans.
• Shift in bank deposit profiles from CASA to term deposits.
• Credit growth slowdown due to risk aversion and regulatory tightening.
• Rising global instability, commodity shocks, and market corrections.

Positive Anchors

• Strong capital buffers across institutions.
• Regulatory agility and forward-looking policy reforms.
• Improved corporate balance sheets and private investment sentiment.

3. PhonePe Enters Co-Branded Credit Card Market with HDFC Bank Partnership

Context:

PhonePe and HDFC Bank have launched a co-branded credit card—marking PhonePe’s entry into the co-branded card segment.

Key Highlights:

• The card is issued on the RuPay network and is named:
  • PhonePe HDFC Bank Co-Branded RuPay Credit Card.
• Designed for UPI-based credit card spending, especially within the PhonePe app ecosystem.
• Can be used seamlessly across UPI-enabled merchants in India.

Card Variants

• The credit card is available in two versions:
  • ‘UNO’ and ‘Ultimo’

About PhonePe

• Founded: August 2016
• Users: Over 61 crore (610 million) as of April 2025
• Merchant Network: 4+ crore (40 million) digital payment acceptance points across India
• Former Name: PhonePe Private Limited (now PhonePe Limited)

Agriculture

1. NABARD and ICAR-NIRCA Collaborate to Train FPOs

Context:

NABARD (National Bank for Agriculture and Rural Development) has partnered with ICAR–National Institute for Research on Commercial Agriculture (NIRCA), Rajahmundry.

• The collaboration aims to train Farmers’ Producers Organisations (FPOs) and farmers in:
  • Post-harvest management
  • Processing technologies for turmeric and chilli

Significance of the Training

• Turmeric and chilli are highly susceptible to:
  • Moisture damage
  • Microbial contamination
• Adoption of modern post-harvest techniques is expected to:
  • Enhance crop value
  • Improve market competitiveness
  • Reduce post-harvest losses

TH

2. India’s Fertiliser Paradox: Need for a New National Fertiliser Policy

Context:

India is the second-largest consumer of fertilisers globally. Despite increased domestic production, 30% of fertilisers are still imported, making India vulnerable to global supply shocks, especially during geopolitical conflicts or trade disruptions.

Key Challenges Highlighted

Overuse and Imbalance

• Average fertiliser use: 141.2 kg/hectare (NPK)
• Current N:P:K usage ratio: 6.7:2.7:1 (vs. recommended 4:2:1)
  • Overuse of Nitrogen (N): 67.5%
  • Overuse of Phosphorus (P): 35%

Low Fertiliser Use Efficiency

• Nitrogen: 30–35%
• Phosphorus: 15–20%
• Potassium: 50–60%

This implies a significant share of nutrients is lost, contributing to soil degradation, groundwater contamination, and climate change through nitrous oxide emissions.

Financial Burden

• FY24 Fertiliser Subsidy: ₹1.75 lakh crore
  • Urea alone: ₹1.31 lakh crore
• Current subsidy regime incentivizes overuse of urea, discouraging balanced nutrient application.

Global Comparison

• India mirrors China’s pre-2015 fertiliser subsidy mistakes, which led to overapplication and environmental degradation.

Recommendations for a New Fertiliser Policy

• Soil Health and Balanced Nutrition
  • Promote bio-fertilisers and nano-fertilisers
  • Encourage crop-specific fertiliser use based on soil health cards
• Farmer Education & Capacity Building
  • Awareness on overuse hazards and benefits of balanced fertilisation
  • Use of mobile-based advisory services, field demos, and training
• Technological Integration
  • Adoption of:
    • AI & Machine Learning
    • Remote Sensing & GIS
    • Blockchain for traceability and subsidy disbursement
• Attract Youth & Startups
  • Innovation grants for agri-entrepreneurs
  • Startups in smart fertilisation and precision agriculture
• CSR Alignment
  • Align Corporate Social Responsibility (CSR) funds toward agri-education and sustainable nutrient practices
• Fertiliser Subsidy Reforms
  • Direct Benefit Transfer (DBT) to farmers, not manufacturers
  • Supply based on landholding, soil type, crop need
  • Incentivise farmers for soil health-based practices
• Reduce Import Dependency
  • Boost domestic fertiliser production
  • Develop alternative nutrient sources using indigenous resources

BL

3. Jhum/Shifting Cultivation

What It Is?

Shifting cultivation is a traditional subsistence farming method where small patches of forest (called swiddens) are cleared—usually through slashing and burning—and cultivated for a few years. Once soil fertility declines, the farmer abandons the land, allowing it to regenerate naturally during a fallow period before returning after a decade or more.

How It Works: Key Features

• Slash-and-Burn Clearing: Vegetation is cut, dried, and burned. The resulting ash boosts soil nutrients.
• Short Cultivation Cycle: Food crops like rice, maize, roots, and tubers are grown until yield declines.
• Extended Fallow Period: Land is left unused for natural regeneration, often longer than the cultivation period.
• Manual Labor: Basic tools like hoes and digging sticks are used; no machinery is involved .
• Subsistence Focus: Primarily serves the farmer’s family and local community.

Where It’s Practiced

• Tropical forests globally: Central & South America, Sub-Saharan Africa, Southeast Asia, parts of India.
• India: Prevalent in hilly tribal areas—Northeast, Odisha, Chhattisgarh, Andhra Pradesh—where it’s known locally as jhum, podu, or chena.

Advantages

• Low-input and cost-effective: Relies on basic labor and natural soil fertilization.
• Ecosystem-sensitive: Long fallows allow forests to regenerate; secondary vegetation helps prevent erosion and supports biodiversity.
• Cultural significance: Deeply embedded in indigenous traditions and lifestyles.

Challenges & Issues

• Deforestation and Habitat Loss: Frequent clearing reduces forest coverage and disrupts ecosystems.
• Soil Degradation: Shortened fallow cycles lead to nutrient depletion, increased erosion, and lowered agricultural productivity .
• Land Pressure: Population increase and reduced fallow periods intensify ecological stress.
• Unsustainability: Overuse turns shifting cultivation into destructive slash-and-burn farming, especially when regeneration does not occur.

Facts To Remember

1. EC clarifies on rules for intensive revision of Bihar voter list

As the electoral rolls in Bihar are undergoing a special intensive revision (SIR), the Election Commission (EC) uploaded the 2003 list of 4.96 crore electors, and clarified that a person born after 1987 need not give the proof of birth of parents if their names figure on the 2003 rolls. 

2. Bank Credit Growth Slows to 9.8% in May 2025 Amid Weak Retail Lending

According to the Reserve Bank of India (RBI), non-food bank credit growth decelerated to 9.8% year-on-year (YoY) in May 2025, compared to 16.2% in May 2024. The slowdown was most prominent in the retail lending segment, including personal loans, credit cards, and vehicle finance.

3. Above Normal Rain in July: IMD

The India Meteorological Department (IMD) has asked authorities and residents of central India, Uttarakhand and Haryana to stay alert to the risk of flooding as the southwest monsoon is expected to be above normal in most parts of the country in July, at 106 per cent of the long period average (LPA).

4. Govt Set to Launch Digital Platform for Power Sector Soon

The government is working to launch a digital platform to enhance coordination, data sharing, and innovation in the power sector.

5. Dollar’s deep dive masks Re’s steeper slide vs euro

The dollar ended June with its worst first-half performance in four decades. However, the dollar’s slide in the international markets has been masking the rupee’s weakness, which is seen in its movement against the euro.

6. SBI turns 70

tate Bank of India (SBI), the country’s largest and most trusted bank, marks 70 years since its formation on July 1, 1955.

Daily Current Affairs Quiz
2 July, 2025

National Affairs

1. RailOne App Launched by Railways

Context:

On July 2, 2025, Railway Minister Ashwini Vaishnaw launched RailOne, a new all-in-one mobile application developed by CRIS (Centre for Railway Information Systems), the IT arm of Indian Railways.

Key Features of the RailOne App

RailOne is a comprehensive, all-in-one platform integrating a variety of services in a single app:

• Unreserved Ticketing System (UTS) via R-Wallet with 3% discount
• Live train tracking
• Grievance redressal portal
• E-catering, porter booking, and last-mile taxi services
• Single-sign-on using mPIN or biometric
• Integration with existing RailConnect and UTS credentials
• No need for multiple railway apps – saves space and improves user experience

Technologies

• The modernised Passenger Reservation System (PRS) is being upgraded to:
  • Support multilingual, agile, and scalable operations
  • Handle 1.5 lakh bookings per minute
  • Manage 40 lakh enquiries per minute

TH

2. Employment-Linked Incentive (ELI) Scheme

Context:

The Union Cabinet has approved a major employment incentive scheme titled Employment-Linked Incentive (ELI) with a total outlay of ₹99,446 crore, aimed at boosting job creation, especially in the manufacturing sector.

Key Features

• Objective: Encourage formal job creation by providing financial incentives to employers and first-time employees.
• Target: Creation of 3.5 crore jobs over two years (August 1, 2025 – July 31, 2027).
  • Of these, 1.92 crore are projected to be first-time job entrants.
• Eligibility:
  • Employees earning up to ₹1 lakh/month.
  • Additional employees retained in jobs for at least six months.
• Incentive Structure:
  • First-time employees to receive one month’s wage (up to ₹15,000).
  • Employers to get incentives of up to ₹3,000 per month for each new job, for a two-year period.
  • For jobs in the manufacturing sector, incentives extend to the third and fourth years.

TH

Banking/Finance

1. RBI’s New Project Finance Norms

Context:

The Reserve Bank of India (RBI), on June 19, 2025, released its final guidelines on project finance provisioning, increasing general provisions for loans extended during the construction phase. The new norms will take effect from October 1, 2025, and will apply only to new projects.

What is RBI’s New Project Finance Norms?

RBI’s new project finance norms, effective October 1, 2025, aim to streamline lending to infrastructure and other projects by banks and NBFCs, promoting stability and growth. The revised framework introduces a principle-based approach for resolving stress in project finance, allows flexibility in extending the date of commencement of commercial operations (DCCO), and reduces provisioning requirements during the construction phase. 

Key Norms

• Commercial Real Estate (CRE) projects: 1.25% general provision
• Commercial Real Estate – Residential Housing (CRERH): 1.0%
• All other projects: 1.0% during the construction phase
• Applies uniformly to projects, including those by MSMEs and small residential housing developers

Concerns Raised

1. Blanket Provisioning Irrespective of Risk
   • Crisil Ratings and banking officials criticized the uniform approach, noting that the norms are not linked to individual project credit risk, unlike existing capital requirements for corporate lending which are aligned to credit ratings.
   • This delinking disregards the diverse risk profiles across sectors and projects.
2. Impact on Smaller Players
   • MSMEs and small-scale housing projects will be disproportionately impacted.
   • Bankers argue this could discourage lending to productive sectors that are vital for inclusive growth.
3. Higher Cost of Infrastructure Finance
   • Increased provisioning means higher capital cost for banks, who in turn may pass this cost to borrowers, making infrastructure financing more expensive.
4. Sector-Agnostic Norms
   • Critics say that diverse sectors with differing risk levels and loss-given-defaults should not be treated uniformly under the same provisioning requirement.

TET

2. Saraswat Bank Seeks RBI Nod to Merge New India Cooperative Bank

Context:

Saraswat Cooperative Bank has formally approached the Reserve Bank of India (RBI) seeking approval to merge the troubled New India Cooperative Bank (NICB) with itself, provided both institutions receive shareholder approval. The move aims to rescue NICB, which is facing financial distress and regulatory restrictions.

Background on NICB’s Crisis

• In February 2025, RBI imposed severe restrictions on NICB:
  • Barred from issuing fresh loans.
  • Withdrawals were capped at ₹25,000 per depositor.
  • RBI superseded the board and appointed an administrator.
• The trigger: allegations of fund misappropriation and negative net worth.
• As of FY25, NICB’s net worth is negative ₹102.74 crore.

Saraswat Bank’s Proposal

• Saraswat aims to:
  • Take over assets and liabilities of NICB.
  • Protect depositor interests.
  • Consider issuing shares to NICB shareholders in a restricted manner (excluding those involved in fraud).

BS

3. RBI’s Role in Bank Mergers and Amalgamations

Context:

The Reserve Bank of India (RBI) plays a central role in regulating and approving mergers, ensuring systemic stability, depositor protection, and adherence to financial norms under the Banking Regulation Act, 1949, particularly Section 44A.

Key Highlights:

• Regulatory Oversight
  • RBI supervises the entire lifecycle of a bank merger — from proposal to post-merger integration.
  • Ensures alignment with national financial stability and banking sector consolidation goals.

• Approval Process
  • Mergers require RBI’s prior approval.
  • RBI evaluates:
    • Financial and operational health of merging entities
    • Capital adequacy and governance structure
    • Impact on depositors and creditors
    • Strategic relevance and risk factors

• Shareholder Approval
  • As per Section 44A, approval from:
    • Two-thirds majority of shareholders (either in person or proxy) of both transferor and transferee banks is mandatory for the scheme of amalgamation.

• Lending Business Overlaps
  • RBI discourages overlapping businesses between:
    • Banks and NBFC subsidiaries
    • Banks and fintech platforms
  • Aims to preserve credit discipline and reduce conflict of interest.

• Cross-Border Mergers
  • RBI’s FEMA regulations govern cases involving foreign banks or international mergers.
  • Requires:
    • No contravention of foreign exchange laws
    • Adequate disclosures and due diligence
    • RBI and government clearance

4. NBFC Credit Growth Slows Despite RBI Support

Context:

Bank lending to non-banking financial companies (NBFCs) has continued to decline, despite the RBI’s rollback of stricter risk-weight norms in April 2025. The sector is facing cautious bank sentiment, growing reliance on bond markets, and delinquencies in microfinance and unsecured loan segments.

Sectoral Challenges

Stress in Key Loan Segments

• Microfinance institutions (MFIs) and fintech business loans have seen a rise in delinquencies.
• This has made banks more cautious about lending to NBFCs.
• Unsecured personal and business loans are under close scrutiny.

Slow Transmission of Policy Rates

• Despite a 50-bps repo rate cut in April, many banks (especially PSBs) have not cut MCLR, limiting benefit to NBFCs.
• Private banks have begun to pass on rate cuts.

Funding Pressure on Lower-Rated NBFCs

• NBFCs rated A- to BBB are the worst hit, as they largely depend on banks and large NBFCs for funding.
• These NBFCs are seeing slower disbursements and higher costs.

Mint

5. Financial Conditions Index (FCI)

Why in News?

The Reserve Bank of India’s (RBI) June 2025 Financial Stability Report presents a positive outlook on India’s financial system, noting that financial conditions have eased, aided by accommodative monetary policy. However, assessing financial conditions remains complex due to the interplay of multiple variables.

What is the Financial Conditions Index (FCI)?

The RBI’s June bulletin proposed an experimental Financial Conditions Index (FCI) to better track the overall state of financial markets at high frequency. While not yet an official tool, it reflects RBI’s interest in building a composite gauge for financial market conditions.

Structure of the Proposed FCI

The proposed FCI includes 20 indicators from five key financial market segments:

1. Money Market – tracks the spread of the weighted average call rate over the repo rate.
2. Government Securities (G-Secs)
3. Corporate Bond Market
4. Foreign Exchange Market
5. Equity Market – uses Sensex, though a broader index like Nifty may be more representative.

These segments are chosen for their direct link to monetary policy transmission and systemic stability.

Why FCI Matters

• An FCI can serve as a composite barometer of how financial markets are responding to economic conditions and policy changes.
• It could offer early warning signals on stress or overheating in financial markets.
• Particularly useful since monetary policy acts with time lags and markets can shift quickly.

Mint

6. AI in Indian Banking

Context:

The banking experience in India is undergoing a rapid and intelligent transformation. From account upgrades to auto loan closures, what once took days is now being completed in minutes — thanks to Artificial Intelligence (AI).

Key Areas of AI Adoption in Banking

• Customer-Facing Transformation
  • Chatbots and voice bots handle real-time queries (WhatsApp, email, SMS).
  • Used by HDFC, Axis, Federal, Yes Bank, Barclays for multilingual and personalised support.
• Operational Automation
  • Tasks like NOCs, credit memos, KYC now done in minutes (was days).
  • GenAI can finish credit assessments in ~10 minutes.
  • AI scans and summarises PDFs and documents.
• Hyper-Personalisation & Predictive Banking
  • AI predicts user needs (e.g., rent reminders, EMI alerts).
  • Shift towards natural language, app-free interfaces.
• Internal Productivity Tools
  • Barclays uses Microsoft Copilot and GitLab Duo for drafting and coding.
  • Axis Bank’s GenAI tool (ADI) supports over 100,000 staff.

AI Infrastructure and Regulatory Oversight

• Around 65–70% of BFSI IT budgets now touch AI, either through fraud analytics, data streaming, or workflow automation.
• Infrastructure providers like Microsoft Azure, AWS, and Google Cloud are building the GenAI backbone for banks.
• To ensure ethical deployment, RBI has formed FREE-AI (Framework for Responsible and Ethical Enablement of AI), led by IIT Bombay, to set guardrails for AI usage in banking.

Key Benefits & Current Limitations

Benefits

• Efficiency Gains: Operational efficiency improved by 15–20%, according to EY.
• Faster Turnaround: Up to 60% reduction in query handling time (e.g., at SBI).
• Improved Customer Engagement: Better personalisation, reduced call wait times, and faster dispute resolutions.

Challenges

• Accuracy risks in mission-critical functions like lending and fraud detection.
• Explainability and auditability remain crucial due to high regulatory sensitivity.
• Budget constraints: Most banks are still investing cautiously (₹5–10 crore range), focusing on low-risk, high-impact use cases.

BS

7. Slice Launches India’s First UPI-Based Credit Card and UPI-Focused Bank Branch

Context:

Fintech startup Slice has launched a new UPI-powered credit card, called the Slice Super Card, along with India’s first physical UPI-centric bank branch and ATM in Bengaluru. The initiative aims to revolutionize how Indians access and use credit through digital platforms.

Key Features of the Slice Super Card

• No joining or annual fees.
• Offers UPI-based credit payments—users can pay by scanning QR codes or making UPI transactions directly from a pre-approved credit line.
• “Slice in 3” feature: lets users split payments into three interest-free installments.
• The card integrates digital credit with India’s most used payment system—UPI, enabling seamless offline and online purchases.

India’s First UPI-Focused Bank Branch & ATM

• Location: Koramangala, Bengaluru
• Facilities include:
  • Instant online onboarding
  • Kiosk-based account opening
  • Cash deposit and withdrawal via UPI-enabled ATM
  • 24×7 automated customer support
  • A digitally self-service banking experience

This marks a significant shift in traditional banking infrastructure toward cashless and frictionless digital banking, focused on ease and inclusion.

Objective: Financial Inclusion Through UPI Credit

• Although 200+ million Indians use digital payments, access to formal credit remains limited.
• Slice, now merged with North East Small Finance Bank, operates as a full-stack bank, controlling its own infrastructure and licenses to serve broader credit needs.
• Goal: Deliver real-time credit at point-of-sale using mobile and UPI, especially to underserved customers and merchants.

BS

8. AU Small Finance Bank Partners with LIC to Boost Life Insurance Access

Context:

On July 2, 2025, AU Small Finance Bank (AU SFB) entered into a strategic partnership with the Life Insurance Corporation of India (LIC) to expand life insurance distribution across rural and semi-urban India.

Key Highlights

• Objective: Supports India’s vision of ‘Insurance for All by 2047’ by improving life insurance penetration in underserved regions.
• Product Offerings: AU SFB will distribute LIC’s full suite of life insurance products, including:
  • Term Insurance
  • Endowment Plans
  • Whole Life Policies
  • Pension and Annuity Plans
  • Child-specific Insurance Plans
• Strategic Significance:
  • Enhances AU SFB’s transition into a full-spectrum financial services provider, integrating banking, protection, and long-term financial planning.
  • Enables LIC to tap into AU’s strong rural presence and customer-centric model for deeper market penetration.

About AU Small Finance Bank (AU SFB)

• Founded: 1996 by Sanjay Agarwal
• Status: Largest Small Finance Bank (SFB) in India
• Type: Scheduled Commercial Bank
• MD & CEO: Sanjay Agarwal
• Customer Base (as of March 31, 2025): Over 1.13 crore

BS

9. SEBI Proposes New IT Capacity Guidelines for Commodity Exchanges and Clearing Corporations

Context:

The Securities and Exchange Board of India (SEBI) has released a draft proposal to revise the IT capacity planning norms for commodity exchanges and clearing corporations, aiming for a more efficient and realistic approach in managing technological infrastructure.

Key Highlights of the Proposal

IT System Capacity Norms

• New Requirement: Maintain IT capacity at 2 times the projected peak load.
• Previous Norm (2016): Required 4 times the peak load but applied only to exchanges.
• Current Proposal: Now extends to clearing corporations as well, ensuring uniformity.

Planning and Monitoring Mechanism

• Forward-looking capacity planning mandated.
• Quarterly stress testing to assess real-time preparedness.
• Real-time automated alert systems must be deployed to detect high utilization.

Utilisation Threshold

• If utilisation exceeds 75% of installed IT capacity:
  • Immediate corrective action is required.
  • Aimed at avoiding disruptions and ensuring operational resilience.

Scope of the Framework

• Applies to:
  • Hardware systems
  • Software systems
  • Third-party vendor platforms

Agriculture

1. Government to Develop ‘Co-operative Stack’ Through PACS for Rural Scheme Delivery

Context:

In a move akin to the Agri Stack initiative, the Government of India is developing a “Co-operative Stack” to streamline rural scheme delivery via Primary Agricultural Credit Societies (PACS). This is part of a broader effort to digitise and strengthen the rural cooperative ecosystem.

What is the Co-operative Stack?

• A technology-driven, integrated platform that connects government schemes with PACS to deliver unified, transparent, and efficient services in rural areas.
• It is being built on the model of Agri Stack, which consolidates farmer data, including land records, crop details, and government scheme usage.

Key Developments

Use of Emerging Technologies

• Integration of AI-based solutions such as automated weather advisories to support farm-level decisions.
• Improved transparency, accountability, and service efficiency post-digitisation.

Institutional Shift

• The Co-operative Stack intends to replace fragmented rural delivery mechanisms (like SHGs and FPOs) with PACS as the central node for service delivery.
• The Reserve Bank of India previously restricted PACS activity due to lack of transparency — an issue now being addressed through digitisation.

What is Primary Agricultural Credit Societies (PACS)?

BL

Facts To Remember

1. SBI celebrates 70^th foundation day, felicitates students

State Bank of India celebrated its 70th foundation day on Tuesday and felicitated 18 children of its staff for their exemplary academic performance and selection into prestigious institutions and organisations.

2. INS Tamal, the last of foreign-built Navy ships, commissioned

The Indian Navy on Tuesday commissioned INS Tamal (F71), a multi-role stealth, guided missile frigate, at the Yantar Shipyard in Kaliningrad, Russia.

3. INS Udaygiri Delivered: Boost to India’s Naval Power & Indigenous Shipbuilding

Project 17A is a successor to the earlier Project 17 (Shivalik-class) and reflects India’s growing capability in indigenous warship design and manufacturing. The Indian Navy received INS Udaygiri, the second stealth frigate under the advanced Project 17A on July 2, 2025.

4. SEBI appoints Sunil Jayawant Kadam as Executive Director

Sunil Jayawant Kadam has been appointed as the Executive Director of the Securities and Exchange Board of India (SEBI), the regulator said in a statement. 

5. Kesavan Ramachandran is new RBI executive director

The Reserve Bank of India has appointed Kesavan Ramachandran as the Executive Director with effect from July 1, 2025, according to a statement. 

6. MGNREGA work demand increased by 4.5%

Households demanding work under Mahatma Gandhi National Rural Employment Guarantee Scheme (MGNREGS) sawa 4.5 per cent jump in June, when compared to the same month last year. Around 27.59 million households had sought work under the scheme in June this year, while the number was 26.39 million in June 2024, data sourced from the website.

Daily Current Affairs Quiz
3 July, 2025

International Affairs

1. BRICS Summit

Context:

Prime Minister Narendra Modi has embarked on a five-nation diplomatic tour beginning July 3, 2025, with a focus on strengthening India’s engagement with the Global South and reinforcing cooperation through multilateral platforms such as BRICS. The tour includes official visits to Ghana, Brazil, Trinidad and Tobago, Argentina, and Namibia. PM Modi will participate in the BRICS Summit in Rio de Janeiro, Brazil.

About BRICS

Origin

• Coined in 2001 by Jim O’Neill, Chief Economist at Goldman Sachs, in the report “Building Better Global Economic BRICs”.
• Originally referred to Brazil, Russia, India, China (BRIC).
• South Africa joined in 2010, forming BRICS.

Headquarters

• BRICS Tower, Shanghai, China

Member Countries

1. Brazil – Latin America’s economic leader with vast natural resources
2. Russia – Reasserting its geopolitical and economic influence
3. India – Fast-growing economy with a large domestic market
4. China – Global industrial and trade powerhouse
5. South Africa – Represents Africa and emerging economies on the continent

Formation Context

• Formed in 2006 (BRIC), expanded in 2010 (BRICS)
• Emerged from the need for economic and political collaboration among fast-growing emerging markets

Key Goals and Objectives of BRICS

• Economic Cooperation:
  • Boost intra-BRICS trade, investment, and growth
  • Advocate for a balanced global financial system
• Political Influence
  • Seek greater representation in global institutions (IMF, World Bank)
  • Counterbalance Western dominance
• Social Development:
  • Promote inclusive growth, poverty reduction, and improved living standards
• Environmental Sustainability
  • Collaborate on climate change and promote sustainable development
• Reform of Global Governance:
  • Push for restructuring of the UN, IMF, and World Bank to reflect the interests of emerging economies

2. Quad Launches Critical Minerals Initiative

Context:

The foreign ministers of the Quad grouping—India, the US, Japan, and Australia—launched the Quad Critical Minerals Initiative to ensure secure, diversified, and reliable supply chains of critical minerals. The move aims to counter global economic coercion and reduce overdependence on any single country, particularly amid concerns over China’s dominance and price manipulation in the sector.

Objectives of the Quad Critical Minerals Initiative

• Diversify and secure supply chains of critical minerals vital to sectors like EVs, electronics, semiconductors, and defense.
• Promote economic security and collective resilience among Quad nations.
• Expand cooperation on e-waste recycling, reprocessing of rare earths, and private sector investment in the critical minerals sector.

Why Critical Minerals Matter

• Rare earths like neodymium, dysprosium, terbium, etc., are vital for:
  • Electric vehicle (EV) motors
  • Jet fighter engines
  • Semiconductor manufacturing
• China dominates processing and refining of these minerals, not just mining.
• It has used export controls to restrict access for strategic and economic leverage, including:
  • Banning exports of gallium, germanium, and certain heavy rare earths.
  • Imposing bureaucratic hurdles on Indian and Western companies.

Impact on India

• India’s growing EV manufacturing industry is facing supply constraints due to lack of approvals from China for sourcing rare earth magnets.
• Beijing has also pushed Indian companies to import full motor assemblies, rather than components, further increasing dependency.

National Critical Mineral Mission (NCMM)

• India’s NCMM, with a budget of ₹16,300 crore, aims to:
  • Boost domestic exploration
  • Acquire overseas assets
  • Support processing R&D and recycling
  • Seek funding through RISE and other multilateral platforms

TH

National Affairs

1. India Celebrates 10 Years of Digital India Initiative

Overview

• Launched: 1st July 2015 by Prime Minister Narendra Modi
• Nodal Ministry: Ministry of Electronics and Information Technology (MeitY)
• Vision: To transform India into a digitally empowered society and knowledge economy
• Tagline (2024): Digital India: Empowering Bharat, Enabling the World

Core Objectives of Digital India

1. Digital Infrastructure as a Utility to Every Citizen
2. Governance and Services on Demand
3. Digital Empowerment of Citizens

Nine Pillars of Digital India

• Broadband Highways
• Universal Mobile Access
• Public Internet Access via CSCs
• e-Governance (Reforming government through technology)
• e-Kranti (Electronic delivery of services)
• Information for All
• Electronics Manufacturing
• IT for Jobs
• Early Harvest Programmes (e.g., Wi-Fi hotspots, biometric attendance)

Success Factors

• Robust Digital Public Infrastructure (DPI):
  • Aadhaar (Identity)
  • UPI (Payments)
  • DigiLocker (Digital documentation)
• Affordable Internet: Cheapest global mobile data (~₹10/GB)
• Mobile Penetration: Widespread access across urban and rural India

2. C-FLOOD: India’s Unified Flood Inundation Forecasting System

Context:

Union Jal Shakti Minister Shri C. R. Patil inaugurated C-FLOOD, a cutting-edge flood forecasting and dissemination system, on July 2, 2025, at Shram Shakti Bhawan, New Delhi. Developed collaboratively by C-DAC Pune, Central Water Commission (CWC), and NRSC, this initiative is a significant advancement in India’s disaster resilience framework.

Key Features of C-FLOOD

• What is C-FLOOD?
  • A web-based Unified Inundation Forecasting System offering:
  • 2-day advance flood forecasts
  • Village-level flood inundation maps
  • Water level predictions
• Technology Used:
  • Powered by 2D hydrodynamic modelling
  • Simulations run on High-Performance Computing (HPC) systems under the National Supercomputing Mission (NSM)
  • Integrated with satellite-based outputs from NRSC under the National Hydrology Project (NHP)
• Coverage:
  • Currently operational in:
  • Mahanadi River Basin
  • Godavari River Basin
  • Tapi River Basin

Strategic Importance

• Disaster Preparedness:
  • Supports National Disaster Management Emergency Response Portal (NDEM) with real-time flood forecasts
• Public Awareness:
  • Ministry directed CWC and partner agencies to popularize the portal for wider public preparedness
• Accuracy Improvements:
  • Use of satellite validation and ground-truthing to enhance forecast precision

PIB

3. Special Registration Scheme for Employers and Workers (SPREE)

Context:

The Employees’ State Insurance Corporation (ESIC), during its 196th Corporation Meeting chaired by Union Labour & Employment Minister Dr. Mansukh Mandaviya in Shimla, approved SPREE 2025 (Scheme for Promotion of Registration of Employers and Employees). This initiative is aimed at expanding social security under the ESI Act, 1948.

Key Highlights of SPREE 2025

• Duration of the Scheme:
  • July 1 to December 31, 2025
• Objective:
  • Promote voluntary registration of unregistered employers and employees, including contractual and temporary workers, under the ESI Act.
• Registration Process:
  • Employers can register digitally via the ESIC portal, Shram Suvidha portal, and MCA portal.
  • Registration will be valid from the date declared by the employer.

Significance of the Scheme

• Encourages voluntary compliance by removing fears of:
  • Retrospective penalties
  • Legal action
  • Backdated financial demands
• Helps bring left-out establishments and workers under the ESI umbrella, especially in contractual and informal sectors.
• Aligns with India’s vision of a welfare-centric and inclusive labour ecosystem.

What is ESIC?

The Employees’ State Insurance Corporation provides healthcare, insurance, and social protection to workers under the ESI Act, 1948, covering medical, maternity, disability, and unemployment benefits.

TET

Banking/Finance

1. Microfinance institutions Will Return to Normalcy: Ind-Ra

Context:

According to a recent report by India Ratings (Ind-Ra), the microfinance institution (MFI) sector in India is expected to return to pre-crisis normalcy only by the second half of FY26, owing to profitability challenges, rising costs, and regulatory uncertainties. The credit rating agency has assigned a ‘deteriorating outlook’ to the sector.

Key Highlights

Delayed Recovery Timeline

• MFIs are unlikely to recover to FY24 performance levels before H2 FY26.
• Factors slowing recovery include:
  • High operating expenses
  • Pressure on lending yields
  • Regulatory tightening by State governments

Impact of Tamil Nadu and Karnataka Ordinances

• Both Tamil Nadu and Karnataka introduced ordinances aimed at curbing coercive loan recovery practices by collection agents.
• These regulatory actions have:
  • Created repayment anxieties among borrowers
  • Affected collection efficiency and loan performance
  • Reduced lender confidence in the sector

Profitability and Yield Pressures

• Return profiles of MFIs remain under pressure, particularly in rural and semi-urban segments.
• Yield rationalization and heightened scrutiny have limited MFIs’ ability to price loans profitably.

Banking Sector’s Risk Mitigation

• Banks, which are key lenders to MFIs, are now adjusting risk models and factoring in non-MFI exposure to manage portfolio risks.
• This may reduce overall credit flow to MFIs, further constraining their growth.

TH

2. SEBI Introduces Common Contract Note with Single VWAP

Context:

The Securities and Exchange Board of India (SEBI) has mandated the implementation of a common contract note featuring a single volume weighted average price (VWAP) for trades executed across exchanges. This directive came into effect on June 27, 2025, and is aimed at streamlining the post-trade reporting process for investors and brokers alike.

Key Highlights

Common Contract Note Introduced

• SEBI’s reform ensures that all trades executed across multiple stock exchanges (e.g., NSE, BSE) will be aggregated in a single contract note.
• This eliminates the current system where investors receive multiple contract notes for trades conducted on different exchanges.

The volume-weighted average price (VWAP)

• The volume-weighted average price (VWAP) is a technical analysis indicator used on intraday charts that resets at the start of every new trading session. It’s the average price a security has traded at throughout the day, based on both volume and price.
• The contract note will reflect a single VWAP per security, computed across all exchanges.
• This simplifies understanding of execution price, especially in high-frequency or algorithmic trades split across venues.

Benefits of the Reform

• Simplified compliance and reporting for brokers and back-office teams.
• Enhanced transparency and clarity for investors in terms of pricing and charges.
• Reduced paperwork and administrative burden for intermediaries.

BS

3. Financial Fraud Risk Indicator (FRI)

Context:

In a major move to strengthen digital financial safeguards, the Reserve Bank of India (RBI) has issued an advisory encouraging all banks to adopt the Financial Fraud Risk Indicator (FRI) developed by the Department of Telecom (DoT). This initiative reflects a growing emphasis on real-time fraud prevention amid the rising use of digital payments across India.

Key Highlights

Real-Time Fraud Detection

• The FRI tool allows real-time risk classification of mobile numbers.
• Risk levels are categorized as:
  • Medium risk
  • High risk
  • Very high risk
• Banks can use this tool to screen mobile numbers during transactions to prevent fraud.

Data Sources

The FRI system is powered by cross-agency intelligence from:

• Indian Cyber Crime Coordination Centre (I4C)’s National Cybercrime Reporting Portal (NCRP)
• DoT’s Chakshu platform
• Fraud intelligence shared by banks and financial institutions

RBI’s Directive

• RBI has advised all Scheduled Commercial Banks, Small Finance Banks, Payment Banks, and Cooperative Banks to integrate the FRI into their internal systems.
• This integration is expected to:
  • Reduce online financial frauds
  • Enhance transaction security
  • Improve fraud detection and response time

Early Adopters of FRI

The tool has already been adopted by several major financial players, including:

• PhonePe
• Punjab National Bank
• HDFC Bank
• ICICI Bank
• Paytm
• India Post Payments Bank

These institutions have reportedly witnessed the tool’s operational utility in reducing fraud risk.

TET

4. IRDAI Eases Concerns Over Bancassurance Crackdown

Context:

In a significant relief to private life insurers, the Insurance Regulatory and Development Authority of India (IRDAI) is unlikely to introduce coercive restrictions on the bancassurance distribution model, despite concerns raised over potential misselling of insurance products via banks.

Key Highlights

• IRDAI’s Position
  • No cap on insurance via bancassurance.
  • Misselling not considered alarming.
  • Focus on facilitating, not mandating, distribution.
• Misselling Concerns (2024)
  • Raised by: Finance Minister, IRDAI Chair (ex), RBI Governor, DFS Secretary.
  • Allegations: Customers coerced or misled by bank staff.
• RBI & DFS Actions
  • DFS: Ensure no forced sales, affordable premiums.
  • RBI: Working on anti-misselling guidelines for banks and NBFCs (as per FY24 Annual Report).
• Industry Impact of Proposed Cap
  • Potential 15–30% drop in bank fee income.
  • Up to 12% reduction in net profits.
  • FY24: Bancassurance earned banks ₹14,500 crore (~2% of total revenue).
• Insurance IPOs
  • No mandatory listing, says IRDAI.
  • Focus on governance, transparency, and enhanced disclosures.
• Grievance Trends
  • UFBP complaints fell 10.6% in FY24.
  • IRDAI formed a task force (Oct 2023) to improve bancassurance efficiency.

BS

5. SEBI Tightens Royalty Disclosure Norms for Listed Firms

Context:

The Securities and Exchange Board of India (SEBI) has introduced enhanced disclosure norms for royalty payments to related parties, following concerns over excessive outflows and opaque contractual arrangements. The changes are aimed at ensuring informed oversight by audit committees and shareholders.

Key Highlights

Trigger for Reform

• A SEBI study in Nov 2024 found that 1 in 4 listed companies paid over 20% of net profits as royalties to related parties over FY14–FY24.

Key Disclosure Mandates

• Disaggregation of composite royalty agreements: Companies must disclose key components (brand, patents, tech, know-how) of composite IP agreements and explain why individual attributions aren’t possible.
• Peer comparison: Enhanced disclosures will allow material related-party royalty payments to be compared across firms.
• Sunset clauses: Mandatory disclosure of payment duration to prevent perpetual or one-sided agreements.
• Differentiation of fees: Professional fees, management support fees, or technical know-how charges must be disclosed, but not clubbed as royalties.

Parent-Subsidiary Transparency

• If a parent entity receives non-uniform royalties from subsidiaries abroad, it must disclose the minimum and maximum rates, a move some experts consider operationally burdensome.

BS

6. RBI Pushes for Real-Time Credit Reporting and Grameen Credit Score to Boost Financial Inclusion

Context:

In a significant move to improve the accuracy and efficiency of lending decisions, the Reserve Bank of India (RBI) has emphasized the need for real-time or near real-time credit reporting by lenders to Credit Information Companies (CICs). The central bank also announced plans to roll out a Grameen Credit Score system tailored to improve credit access in rural India.

Key Announcements

Real-Time Credit Reporting

• Since January 1, 2025, lenders have upgraded from monthly to fortnightly credit data submission.
• RBI now urges further progress to real-time updates, which would:
  • Enhance underwriting precision
  • Reflect loan closures and repayments promptly
  • Improve consumer credit experience
• M. Rajeshwar Rao, RBI Deputy Governor, said this shift requires investment in technology, process reengineering, and change management.

Risks and Data Governance Challenges

• Data accuracy and security remain critical.
• Rao cautioned that:
  • Inaccurate or incomplete data may distort analytics and decision-making.
  • Poor data security may result in legal and reputational risks.
• The growing reliance on AI and ML models raises model risk, especially if biases, validation, and performance drifts are not managed.

Grameen Credit Score for Rural Inclusion

• RBI is designing a Grameen Credit Score system to:
  • Boost formal credit access for rural populations, SHG members, and marginalised communities.
  • Complement existing credit scores but tailored for informal rural borrowing behavior.

No Pre-Payment Charges for Business Loans to Individuals and MSEs

• RBI bans prepayment penalties on:
  • Loans to individuals and micro/small enterprises (MSEs), with or without co-obligants.
  • Loans sanctioned by scheduled commercial banks, NBFCs, small finance banks, urban cooperative banks, and RRBs.
  • Applies to loans up to ₹50 lakh, irrespective of prepayment source or lock-in period.

Mint

7. IndusInd Bank Launches “INDIE for Business”

Context:

IndusInd Bank has launched INDIE for Business, a digital banking platform aimed at empowering India’s 60 million-plus Micro, Small and Medium Enterprises (MSMEs) by offering integrated solutions across payments, lending, collections, and account management.

Key Features & Benefits

• Unified Financial Dashboard
  • 360° view of all business accounts
  • Real-time tracking of loans, EMIs, and due dates
• Digital Self-Onboarding
  • Paperless registration using Aadhaar, debit card, or net banking
  • Enables access to POS, QR payments, and payment links
• Multi-Entity Profile Management
  • Manage multiple business entities with profile switching
• Bulk Payments & Tax Compliance
  • Automate payments such as vendor salaries, GST, income tax, and customs duties
• Cross-Border Capabilities
  • Supports instant, paperless international transactions
• Operational Flexibility & Security
  • On-the-go transaction authorization with role-based access

Relevance to MSMEs

• Traditional banking often lacks tailored services for MSMEs due to collateral requirements and procedural delays
• INDIE for Business provides a seamless experience with tax integration, bulk transaction support, and enhanced loan visibility

TET

8. Karur Vysya Bank Partners with Kshema General Insurance for Rural-Focused Bancassurance

Context:

Karur Vysya Bank (KVB) has entered into a strategic bancassurance alliance with Kshema General Insurance to launch a specialized dual-benefit insurance product named Kshema Kisan Sathi, focusing on India’s rural and agri-centric population.

Key Highlights of the Partnership

• Product Launch:
  • Kshema Kisan Sathi is a tailor-made insurance solution targeting rural families, farmers, and agri-entrepreneurs.
• Strategic Focus:
  • Aims to foster financial inclusion, resilience, and self-sufficiency in India’s rural economy.
• Technology + Outreach:
  • Leverages Kshema’s tech-driven insurance platform with KVB’s vast rural customer network for wide-scale penetration.
• Socio-Economic Impact:
  • Seeks to boost the rural economy through enhanced insurance coverage, risk mitigation, and financial stability.

What Is Bancassurance?

• Definition:
  • Bancassurance is a distribution model in which a bank partners with an insurance company to sell insurance products through its branches and customer networks.
• Benefits:
  • For banks: Additional revenue stream through commissions
  • For insurers: Access to a wide, pre-existing client base
  • For customers: Convenience and bundled financial services under one roof

9. SBI Launches Specialized Global Trade Finance Centres in Kolkata and Hyderabad

Context:

The State Bank of India (SBI) has inaugurated two specialized Global Trade Finance Centres (GTFCs) in Kolkata and Hyderabad to enhance its trade finance capabilities and offer faster, tech-enabled services in import-export processing.

Key Highlights

• Focus Areas:
  • Inland trade processing
  • Import and export transaction management
  • Digitization of document flows
• Customer Benefits:
  • Faster turnaround time
  • Enhanced compliance standards
  • Superior customer experience through streamlined and specialized service delivery

Tech-Driven Transformation

SBI’s trade finance operations are transitioning from traditional paper-based systems to digital platforms using advanced technologies:

• Artificial Intelligence (AI)
• Machine Learning (ML)
• Blockchain
• Document Digitization

This shift is expected to enhance accuracy, speed, and risk management in trade finance.

Agriculture

1. Artificial Intelligence (AI)-driven National Pest Surveillance System (NPSS)

Context:

India’s Ministry of Agriculture and Farmers Welfare plans to expand its Artificial Intelligence (AI)-driven National Pest Surveillance System (NPSS) nationwide to mitigate crop losses from pests, weeds, and diseases. The system leverages AI-based image recognition to detect pest attacks and issue advisories.

Key Highlights

About NPSS

• Launched: 15 August 2024
• Current Reach: ~30,000 users (farmers & extension workers)
• Planned Expansion: Up to 146 million farmers
• Coverage: Currently supports pest detection in 61 crops

Functionality

• Farmers upload images of affected crops or pests
• AI model identifies pest type using computer vision
• Provides targeted pest management advice, reducing:
• Crop losses
• Indiscriminate pesticide use

Significance

• Annual crop losses due to pests, weeds, and diseases: 10–35%
• Pest infestation varies by climate conditions (temperature, humidity, rainfall), crop type, and farming practices
• AI helps differentiate pests from beneficial insects
• Supports sustainable pest management

Broader Impact

• Agriculture contributes 18% to India’s GDP
• Sector engages 46% of India’s population
• Improved pest surveillance aids:
• Food security
• Farmer income protection
• Inflation control

Mint

Facts To Remember

1. SBI Labels Reliance Communications Loan as Fraud; Anil Ambani Faces Regulatory Heat

In a significant legal and financial development, State Bank of India (SBI) has classified its loan account of Reliance Communications Ltd. (RCom) as fraud, implicating its former chairman Anil D. Ambani in alleged fund diversion and financial irregularities. The move comes after a year-long process involving forensic audits and show-cause notices.

2. Banking System Surplus Liquidity Hits ₹3.31 Trillion — Highest Since June 13, Says RBI

As per the Reserve Bank of India (RBI) data, net liquidity in the Indian banking system stood at a surplus of ₹3.31 trillion as of July 1, 2025, the highest level recorded since June 13. The surplus persists despite recent Variable Rate Reverse Repo (VRRR) operations conducted to absorb excess liquidity.

3. PNB Waives Charges for Non-Maintenance of Minimum Balance in Savings Accounts

Punjab National Bank (PNB) has announced a significant customer-centric move by waiving penal charges for non-maintenance of Minimum Average Balance (MAB) in all savings accounts, effective July 1, 2025.

4. Starlink launches services in Sri Lanka, bridging digital divide with Island-wide coverage

Sri Lanka becomes the latest Asian nation to join Starlink’s network, following Japan, the Philippines, Malaysia, Mongolia, and Indonesia. Coverage is now live across the island, with monthly plans for residential users and for businesses.

Daily Current Affairs Quiz
4 July, 2025

National Affairs

1. National Sports Policy 2025

Context:

The Union Cabinet has approved the National Sports Policy (NSP) 2025, replacing the 2001 policy. It aims to transform India into a global sporting powerhouse and prepare the nation for the 2036 Olympics.

What is National Sports Policy 2025?

It is a comprehensive national framework designed to:

• Promote sports excellence from grassroots to elite levels
• Boost participation and inclusivity
• Integrate sports with economy, education, technology, and governance

The policy follows a whole-of-government and multi-stakeholder implementation model.

Key Features of NSP 2025 (Crisp)

1. Excellence on Global Stage
   • Early talent ID & grassroots-to-podium model
   • Elite training at SAI centres with AI & sports science
2. Sports as Economic Driver
   • Promotes sports tourism, local manufacturing (e.g., Meerut)
   • Supports startups via PPPs, CSR, innovation hubs
3. Social Inclusion & Traditional Sports
   • Tailored schemes for women, tribals, PwDs
   • Revival of Indian games like Kho-Kho, Mallakhamb
4. Sports as People’s Movement
   • Mass campaigns: Khelo India, Fit India
   • National fitness indices for institutions
5. Education Integration (NEP 2020)
   • Sports in curriculum with trained PE staff
   • Dual-career paths for student-athletes
6. Strategic Implementation
   • KPI-based national monitoring system
   • AI-driven state governance; use of wearables, big data

2. IISc Launches BHARAT Study to Build India-Specific Biomarkers for Healthy Ageing

Context:

The Indian Institute of Science (IISc) Bengaluru has launched the BHARAT Study to create India-specific reference values for healthy ageing biomarkers. This effort aims to reduce misdiagnosis and improve geriatric care by addressing the limitations of Western-centric medical benchmarks.

What is Healthy Ageing?

Healthy ageing is the process of maintaining physical, mental, and functional well-being in later life. It prioritizes quality of life over mere longevity. Biological age—reflected in organ function or cellular markers—often differs from chronological age.

Key Data & Trends on Ageing in India

• By 2050, 20% of India’s population (approx. 319 million) will be 60+ (UNFPA India).
• Disease burden: Parkinson’s cases may rise 168%, and dementia by 200% (Lancet, 2024).
• Only 28% of the elderly receive formal pension support (NSSO 75th round).
• Less than 5% of Primary Health Centres have geriatric outpatient services (MoHFW).
• Gender disparity: Women outlive men but suffer more disability-adjusted life years (DALYs).

Features of Healthy Ageing

• Functional independence in daily tasks (e.g., cooking, walking).
• Resilience to stress, such as surgery or infections.
• Good mental health with low social isolation and depression.
• Use of preventive biomarkers like CRP, HDL, and metabolite levels.
• Culturally adapted health standards rather than universal Western benchmarks.

Why India Needs a Contextual Approach

• Faster ageing transition than OECD peers (e.g., Kerala’s elderly dependency rate to hit 35%).
• Western lab norms often misinterpret Indian metabolic profiles (e.g., B12 deficiency).
• Social security void: <20% elderly covered under old age pension schemes.
• Rural-urban divide in access to geriatric wards and transport.
• Weakened family care due to nuclearisation of households.

Challenges to Healthy Ageing

• Data scarcity: Most available biomarkers are based on Western studies like NHANES.
• Cultural reluctance to medical screening among tribal and rural elders.
• Low budget priority: NPHCE underfunded within NHM.
• Sampling bias: Difficulty in finding healthy elderly for baseline samples.
• Early-life disease burden skews adult ageing trajectories.

Key Initiatives

• BHARAT Study (IISc): India’s first bio-bank on ageing biomarkers, focusing on local genetic, nutritional, and environmental factors.
• NPHCE: Offers geriatric clinics and home-based care.
• LASI (Longitudinal Ageing Study in India): Tracks elder health and functional decline.
• RSBY / AB PM-JAY: Health insurance for age-related diseases.
• Medical education: Geriatrics included in MBBS and AYUSH specialisations.

TH

3. NITI Aayog Report on Chemical Industry

Context:

NITI Aayog has released a strategic roadmap titled “Chemical Industry: Powering India’s Participation in Global Value Chains (GVCs)”. The report envisions India becoming a global chemical powerhouse with 12% GVC share and USD 1 trillion output by 2040.

Current Landscape of India’s Chemical Industry

• Global Rank: 6th largest producer globally; 3rd in Asia.
• GDP Contribution: 7% of manufacturing GDP; supports pharma, textiles, agriculture, construction.
• Fragmentation: MSME-dominated; lacks integrated clusters and infrastructure.
• GVC Participation: Only 3.5% global share; trade deficit of USD 31 billion (2023).
• Import Dependence: High reliance on China for APIs and Gulf for feedstock.
• Regulatory Challenges: Long delays in environmental clearances (12–18 months).
• Skill Gaps: 30% shortfall in trained professionals in green chemistry and nanotech.

Opportunities Identified

• Green Chemistry Demand: Eco-friendly chemical demand rising globally.
• China+1 Strategy: Global firms looking for alternatives to China.
• FTAs Leverage: Trade pacts with UAE, EU, ASEAN open export potential.
• PLI Schemes & Parks: Government support via PLI, PCPIRs, mega chemical clusters.
• Employment Potential: 7 lakh skilled jobs possible by 2030.

Challenges Facing the Sector

• Feedstock vulnerability, outdated clusters, high logistics costs.
• Regulatory bottlenecks and policy inconsistency.
• Poor academia-industry interface and low patent output.

NITI Aayog Key Recommendations

1. Mega Chemical Clusters:
   • Upgrade existing clusters (e.g., Paradeep, Dahej, Vizag).
   • Chemical Infrastructure Fund & empowered committees.
2. Opex Subsidy:
   • Incentives based on import substitution and export growth.
3. R&D and Tech Transfer:
   • DST-led interface for academia-industry collaboration.
   • Support tech transfer from global players.
4. Regulatory Reforms:
   • Simplify Environmental Clearances via DPIIT committee.
   • Enhance transparency.
5. Skilling Initiatives:
   • Expand ITIs, create courses in polymer science and process safety.
6. Trade Facilitation:
   • Include chemical-specific provisions in FTAs.
   • Simplify documentation and origin certification.

Mint

Banking/Finance

1. FinMin Urges PSBs to Ramp Up Branch Expansion Amidst Private Bank Competition

Context:

The Union Finance Ministry has directed public sector banks (PSBs) to accelerate physical branch expansion to compete with the aggressive network growth of private banks and small finance banks (SFBs), despite strong digital adoption.

Key Highlights:

• Branch Expansion Drive:
  • PSBs were asked to identify high-potential locations and open more branches, especially in underserved and semi-urban/rural areas.
  • The goal is to counterbalance the expansion by private banks and SFBs, and to enhance customer trust through a “phygital” model (physical + digital).
• Special Focus:
  • Finance Ministry urged banking infrastructure expansion in the Northeast, where branch density is low.

BS

2. AMFI Seeks ₹250 Chhoti SIP Rollout Plans from Fund Houses After SEBI Nudge

Context:

To promote small-ticket investing and deepen mutual fund penetration, the Securities and Exchange Board of India (SEBI) has nudged AMFI (Association of Mutual Funds in India) to push for the rollout of ₹250 micro-SIPs under the Chhoti SIP initiative.

Key Highlights:

• SEBI’s Initiative:
  • First proposed in a January 2025 consultation paper.
  • Aimed to financialise savings and expand retail participation in mutual funds.
  • Proposed cost subsidies for fund houses to absorb onboarding and transaction-related costs for low-ticket investments.
• AMFI’s Response:
  • On June 27, AMFI sent a letter to all fund houses asking for their plans to launch ₹250 SIPs.
  • The move comes as over two-thirds of fund houses are yet to introduce these offerings.
• Current Status:
  • Top 15 AMCs (by AUM) have already reduced minimum SIP sizes—some as low as ₹100.
  • However, ₹250 SIPs specifically qualify under SEBI’s proposed subsidised framework.
  • The final circular from SEBI is still awaited, adding to market uncertainty.
• Implementation Challenges:
  • The SEBI framework limits subsidy eligibility to only the first three ₹250 SIPs per investor.
  • AMCs report technical and procedural hurdles in verifying investor eligibility during onboarding.
  • If SIPs are launched at any other amount, subsidy benefits won’t apply.

Association of Mutual Funds in India (AMFI)

Association of Mutual Funds in India (AMFI) is an Indian trade association for all the asset management companies of SEBI registered mutual funds in India.

BS

3. New Consumer Price Index (CPI) Series

Context:

India is preparing to roll out a new Consumer Price Index (CPI) series aimed at enhancing the accuracy and responsiveness of inflation measurement, by widening the coverage of goods/services and updating the base year.

Key Highlights:

Broader and Granular Representation

• The new CPI series will:
  • Expand the basket of goods and services to reflect evolving consumption patterns.
  • Correct under-representation of services, which currently distorts inflation signals.
  • Capture regional variations, offering granular insights into rural vs urban inflation and inter-state price divergences.

Methodological Overhaul

• Proposed upgrades include:
  • Enlarged sample size for greater statistical reliability.
  • Technology-based data collection, including use of AI and eCommerce platforms.
  • Better weight allocation techniques to avoid bias in the absence of micro-level data.

Integration of AI in Price Measurement

• AI enables:
  • Real-time, low-cost, and high-frequency data harvesting.
  • Tracking price pressure build-ups and evaluating the impact of trade policies.
  • Modelling of price rigidity and transmission lag, aiding better macroeconomic policy design.

Significance

• A more representative CPI will:
  • Improve the accuracy of monetary policy (especially inflation targeting).
  • Enable quicker responses to price shocks.
  • Help in diagnosing supply-side bottlenecks effectively.
• AI-led modelling offers a paradigm shift in the way CPI and inflation dynamics are tracked, potentially placing India at the forefront of data-driven economic governance.

TET

4. DSP Launches India’s First Retail Offshore Mutual Fund from GIFT City

Context:

India has officially opened the door to retail-focused offshore mutual funds with the launch of DSP Mutual Fund’s Global Equity Fund on June 2, 2025, from GIFT City (Gujarat International Finance Tec-City). This marks a regulatory milestone, enabling resident Indians to invest globally without relying on offshore brokerages, while sidestepping the Reserve Bank of India’s overseas investment caps applicable to SEBI-regulated mutual funds.

Key Highlights:

First Retail Global Fund Under GIFT City’s New 2025 Framework

• Launched by: DSP Mutual Fund
• Minimum investment: $5,000
• Fund type: Open-ended global equity mutual fund
• Eligible investors: Indian residents (NRIs excluded), via Liberalised Remittance Scheme (LRS)
• Investment cap: Subject to individual $250,000 LRS limit
• NFO period: Open for 30–40 days; continuous acceptance thereafter

Why It Matters

• Not under SEBI’s $7 billion overseas limit, which has paused many global feeder funds
• Leverages GIFT City’s international jurisdiction, enabling direct retail participation
• Promises simplified taxation, regulatory transparency, and broader access to global markets

Implications

• Enables diversification without feeder funds
• Creates competition for offshore platforms like US-based brokerages
• Supports India’s ambition to become a financial gateway through GIFT City
• Reflects SEBI and IFSCA’s push for liberalizing outbound retail flows

Mint

5. RBI Bans Pre-Payment Charges on Floating Rate Loans for Individuals and MSEs

Context:

The Reserve Bank of India (RBI) has prohibited pre-payment charges on floating rate loans extended to individuals and Micro & Small Enterprises (MSEs), effective from January 1, 2026. The move aims to promote greater borrower flexibility, ensure fair lending practices, and eliminate anti-competitive barriers in credit markets.

Key Highlights:

Who Benefits?

• Individuals
• Micro & Small Enterprises (MSEs)
  → Loans for business or personal purposes

What Loans are Covered?

• Floating rate term loans and demand loans
• Sanctioned or renewed on or after January 1, 2026
• Includes loans with co-obligants
• Dual rate loans (fixed + floating): Charges barred only if floating at time of pre-payment

Institutions Covered

No Prepayment Charges Allowed for the Following:

1. Commercial Banks (excluding Payment Banks, SFBs, RRBs, LABs)
2. Co-operative Banks (Tier 4 Urban Co-op Banks with deposits > ₹10,000 crore)
3. NBFCs – Upper Layer (NBFC-UL)
4. All India Financial Institutions (AIFIs)

No Exceptions on Pre-Payment Source

• Applies to partial or full pre-payments
• Applies regardless of whether borrower uses own funds or external funds
• No lock-in period needed

What is Not Allowed?

• Charging fees when prepayment is initiated by the lender
• Imposing retrospective prepayment charges after waivers were granted earlier

Why This Move?

• RBI’s review highlighted:
• Restrictive and inconsistent prepayment practices
• Grievances from MSE borrowers
• Barriers to refinancing and competitive borrowing

Legal Basis

RBI exercised powers under:

• Banking Regulation Act, 1949: Sections 21, 35A, and 56
• RBI Act, 1934: Sections 45JA, 45L, and 45M
• National Housing Bank Act, 1987: Section 30A

The Indian Express

6. Mashreq Bank Gets In-Principle Nod to Open IBU at GIFT City, Gujarat

Context:

Mashreq Bank, one of the leading financial institutions in the UAE, has received in-principle approval (IPA) to set up an International Financial Services Centre Banking Unit (IBU) at GIFT City in Gujarat, making it the first UAE-based bank to achieve this milestone.

Key Highlights:

• Regulatory Milestone:
  • Mashreq Bank secured in-principle approval from the International Financial Services Centres Authority (IFSCA).
  • Approvals have also been obtained from the UAE Central Bank and the Special Economic Zone (SEZ) Authority.
• Expected Launch:
  • The IBU is expected to become operational by Q4 2025, subject to final regulatory clearances.
• Premises & Staffing:
  • Branch location at GIFT City has been finalized.
  • Recruitment for key positions is underway.

Services to be Offered by Mashreq’s GIFT City IBU

• Foreign Currency Loans
• Trade Finance Solutions
• Treasury and Risk Management Products

These offerings will allow Mashreq to serve multinational clients more efficiently across time zones and regulatory jurisdictions.

Strategic Significance

• This marks a key development in India-UAE financial cooperation.
• Enhances GIFT City’s position as a preferred destination for global banking operations.
• Positions Mashreq to capitalize on cross-border financing and international trade flows via India’s IFSC ecosystem.

TET

Agriculture

1. KisaanSay to Partner with 500 FPOs Under Co-Branded Profit-Sharing Model

Context:

KisaanSay, a B2C agribusiness company that sources food products directly from farmers, is scaling up its partnership with Farmer Producer Organisations (FPOs) across India to boost farmer incomes and supply chain efficiency.

Key Highlights:

• Expansion Plan:
  • KisaanSay plans to collaborate with 500 FPOs over the next 4–5 years, up from 20 currently engaged.
• Profit Sharing Model:
  • FPOs will handle production and bear associated costs, while KisaanSay will manage marketing and sales. Profits will be split 50:50 under a co-branded model.
• Current Reach:
  • The company has reached 50,000 farmers through its network and offers over 100 farm-based products.
• Supply Chain Strategy:
  • Products are first packed by FPOs and sent to a central warehouse. To reduce logistics costs, regional distribution hubs will be set up across India.
• Revenue Potential:
  • Each participating FPO could earn up to ₹4 crore annually, with some already crossing ₹50 lakh in turnover.
• Platform Presence:
  • KisaanSay’s products are available on major platforms like Amazon, Blinkit, Zepto, BigBasket, Reliance Jio, and soon on Flipkart.
• International Plans:
  • The company is finalizing export deals with Dubai for both online and offline sales.
• Government Support:
  • KisaanSay shared its model during a weekly webinar organised by the Union Agriculture Ministry, initiated by Secretary Devesh Chaturvedi.

Why It Matters:

This model directly connects farmers to consumers, promotes value addition at source, and supports rural entrepreneurship. It also aligns with India’s agri-export goals and digital retail penetration.

BL

2. One-Nation-One-Licence for Micro-Fertiliser Manufacturers Amid Over-Regulation

Context:

The Indian Micro Fertilisizers Manufacturers Association (IMMA) has called for a complete overhaul of India’s fertiliser regulatory regime, citing high compliance costs, excessive inspections, and outdated provisions under the Fertiliser Control Order (FCO).

Key Highlights:

• Industry Demand:
  • IMMA has urged the Centre to implement a “One Nation, One Licence” policy for micro-fertiliser manufacturers to eliminate the need for separate state-level licences.
• Outdated Framework:
  • IMMA President Rahul Mirchandani said the Fertiliser Control Order (FCO) has outlived its original intent, similar to how FERA was replaced with FEMA to reflect a liberalised economy.
• Compliance Burden:
  • Over-regulation leads to compliance costs of 8–15%, passed on to farmers. Micronutrient fertilisers require multiple registrations, state depots, and face frequent inspections.
• Growth Sector:
  • Micronutrient fertilisers are one of the fastest-growing segments in Indian agriculture, with FY2025 consumption at 6.35 lakh tonnes and a 7.1% CAGR, mainly driven by cereals and grains.
• Recommendations:
  • Pan-India valid licence
  • Eliminate state-wise sale permissions
  • Centralised digital product registry
  • Rationalise local inspector powers
  • Align compliance with IGST regime

Why It Matters

The fertiliser industry plays a key role in agricultural productivity. Rationalising outdated regulations and streamlining compliance can boost domestic production, lower prices, and reduce reliance on imports.

BL

Facts To Remember

1 Title: Centre to Begin Signature Process for Motion to Remove Justice Yashwant Varma

Date: 4 July 2025

Context:

Ahead of the Monsoon Session of Parliament (starting July 21), the Central Government is preparing to initiate a motion seeking the removal of Justice Yashwant Varma of the Allahabad High Court following the discovery of burnt currency notes at his official residence.

2. 3 Apache combat helicopters to arrive in India by July 15

Following the India-U.S. Defence Ministers’ dialogue, the long-awaited Apache combat helicopters are to be delivered in the next two weeks.

3. Nvidia becomes worlds most valuable firm

Nvidia hit a market value of $3.92 trillion in intraday trade on Thursday, as Wall Street doubled down on optimism about artificial intelligence (AI).

4. RBI announces seven-day rate reverse repo auction on 4 July

The Reserve Bank of India (RBI) saiD it will conduct a seven-day variable rate reverse repo auction worth ₹1 trillion on 4 July, after a review of liquidity conditions in the banking system. 

5. PM Modi Conferred Ghana’s Highest Honour: ‘The Officer of the Order of the Star of Ghana’

During his visit to Accra, Prime Minister Narendra Modi was awarded Ghana’s highest civilian honour and addressed a joint session of the Ghanaian Parliament, emphasizing India’s solidarity with the Global South.

Daily Current Affairs Quiz
5 July, 2025

National Affairs

1. India’s First Equine Disease-Free Compartment (EDFC) Recognised by WOAH

Context:

India has achieved a major milestone in its animal health and trade facilitation efforts with the World Organisation for Animal Health (WOAH) formally recognising the country’s first Equine Disease-Free Compartment (EDFC). This facility will now allow Indian sport horses to participate in international competitions and trade under globally accepted health and biosecurity norms.

What is an Equine Disease-Free Compartment (EDFC)?

An EDFC is a scientifically managed and biosecure zone where horses are kept free from specific equine diseases, meeting international standards set by the WOAH Terrestrial Animal Health Code.

• Location: Remount Veterinary Corps (RVC) Centre & College, Meerut Cantonment, Uttar Pradesh
• Recognised by: World Organisation for Animal Health (WOAH)
• Established under: Ministry of Fisheries, Animal Husbandry and Dairying

Key Features of the EDFC

Aspect	Details
Disease-Free Certification	Free from Equine Influenza, Glanders, Surra, Equine Piroplasmosis, and Equine Infectious Anemia
African Horse Sickness	India remains free since 2014
Biosecurity Measures	Standard Operating Procedures for pest control, hygiene, waste disposal, and animal health monitoring
24×7 Surveillance	Continuous veterinary checks and real-time monitoring of equine health
Compartmentalisation	Segregates a defined sub-population of horses to maintain disease-free status

Significance and Impact

• Trade Facilitation: Indian horses can now participate in international equestrian events and global trade, enhancing export potential.
• Boost to Sports: Opens new opportunities for Indian equestrian athletes and sport horses in global arenas.
• Veterinary Infrastructure Strengthening: Demonstrates India’s advancement in adopting science-based, globally harmonised animal health practices.
• Replicability: India is extending the compartmentalisation model to poultry sector (HPAI-free compartments) to enable safe exports of poultry products.

Why This Matters

• Reinforces India’s biosecurity framework
• Aligns with international trade and animal health protocols
• Positions India as a responsible and proactive stakeholder in global animal husbandry and veterinary governance

Banking/Finance

1. SEBI Bans Jane Street Group for Stock Manipulation

Context:

On July 4, 2025, the Securities and Exchange Board of India (SEBI) took stern enforcement action against U.S.-based hedge fund giant Jane Street Group and its affiliated entities for allegedly manipulating the Bank Nifty index and unlawfully earning ₹4,843.6 crore through a deceptive trading scheme.

Key Allegations by SEBI:

• Market Manipulation Tactics: Jane Street is accused of artificially inflating prices in the underlying cash market on weekly index expiry days to benefit its options positions.
• Use of Excessive Orders: The firm allegedly placed excessively large orders at high prices, thereby influencing index levels for strategic advantage.
• Violation of PFUTP Norms: SEBI noted that such actions may violate the Prohibition of Fraudulent and Unfair Trade Practices (PFUTP) under the SEBI Act.

SEBI’s Interim Order:

• Immediate Market Access Ban: Jane Street is barred from taking new positions or trading in Indian markets during the investigation period.
• ₹4,844 Crore Impounded: Unlawful profits accrued by Jane Street between January 2023 and March 2025 are under freeze.
• Close Surveillance Ordered: SEBI has instructed stock exchanges to monitor Jane Street’s activities for any indirect market access.

Regulatory Action Taken:

• Market Ban:
  • Jane Street and its four entities are barred from accessing Indian securities markets.
• Escrow Order:
  • SEBI ordered the creation of an escrow account with a scheduled commercial bank to deposit the entire sum earned through the alleged manipulation.
• Freeze on Accounts:
  • Banks, depositories, and other market intermediaries were directed to not allow debits from Jane Street’s accounts without SEBI’s permission.

About Jane Street:

• Headquartered in New York, Jane Street is a major global proprietary trading firm employing over 2,600 people.
• In 2024, it earned $20.5 billion in net trading revenue, nearly double its 2023 earnings.
• It has made ₹36,502 crore in profits in India between Jan 1, 2023, and Mar 31, 2025.

BS

2. India Ratings Maintains Negative Outlook on IndusInd Bank Despite AA+ Rating Affirmation

Context:

India Ratings and Research (Ind-Ra) has affirmed an AA+ rating on IndusInd Bank’s debt instruments while removing them from Rating Watch with Negative Implications. However, the outlook remains “Negative”, reflecting persistent concerns over the bank’s internal controls and financial reporting irregularities.

Key Reasons Behind Negative Outlook

• Accounting Irregularities
  • ₹4,920 crore discrepancies in derivatives accounts reported in FY25.
  • Disclosed on March 20, 2025; triggered a temporary “Rating Watch with Negative Implications.”
• Governance and Internal Control Weaknesses
  • Raises red flags on internal risk management and corporate governance.
  • India Ratings sees vulnerability in franchise stability despite remedial steps.
• Liquidity and Provisions
  • Bank created ₹62,000 crore in liquidity by winding down its corporate book.
  • Entire ₹1,325 crore contingent provision buffer was utilized in Q4FY25.
• Profitability Under Pressure
  • RoA expected to fall from avg. 1.8% (FY23–24) to ~1.0% in FY25.
  • Cost-to-income ratio worsened from 47.1% (FY24) to 60% (FY25).
  • High Opex due to retail expansion and provisioning needs.
• Strategic Uncertainty
  • Potential leadership change could recalibrate strategy on loan growth, asset mix, and liability management.
  • May impact credit quality, margin profile, and long-term profitability.

BS

3. RBI Moves to Standardize Credit Bureau Data and Improve Transparency for Borrowers

Context:

The Reserve Bank of India (RBI) has initiated a major review of credit bureau processes to address data inconsistencies, enhance information symmetry, and improve customer grievance redressal. This move follows rising concerns among lenders and borrowers about discrepancies in credit scores and inconsistent data updates by Credit Information Companies (CICs).

Key Highlights:

• Technical Working Group Formation
  • RBI has constituted a working group to assess CIC and bank proposals.
  • Goal: Standardize data reporting, reduce score-related disputes, and improve credit information accuracy.
• Involvement of Major Credit Bureaus
  • All four CICs—TransUnion CIBIL, Equifax, Experian, CRIF High Mark—are actively engaged.
  • Recommendations include:
    • Unified grievance redressal portal
    • Uniform Data Quality Index (DQI)
    • Single-window system for data submissions
• RBI’s Broader Strategy
  • Grievance Handling: Centralized, time-bound, transparent resolution system.
  • Data Updates: Move to real-time or more frequent credit data submissions (from fortnightly).
  • Write-offs/Inactives: Standard classification protocols.
  • Identity Verification: Call for a unique borrower ID to avoid mismatches and duplicate records.
• Enforcement Under RBI Integrated Ombudsman Scheme (2021)
  • CICs now fall under RBI’s Ombudsman framework.
  • Borrowers can claim ₹100/day compensation if complaints are unresolved beyond 30 days.
  • RBI insists on faster correction of credit reports and improved consumer protection.

Implications for Stakeholders

• Borrowers:
  • Better dispute resolution and visibility of credit status.
  • Uniform process to file and track complaints.
• Lenders (Banks/NBFCs):
  • Enhanced credit risk profiling through cleaner data.
  • Reduced loan rejection errors due to inaccurate reports.
• CICs:
  • Need to upgrade systems, improve turnaround time, and maintain data quality standards.

TET

4. MobiKwik Enters Stock Broking Arena with SEBI Nod

What’s the news?

Mobikwik’s wholly-owned subsidiary, MobiKwik Securities Broking Pvt Ltd (MSBPL), received SEBI registration on July 1, 2025, enabling it to operate as a stockbroker and clearing member—authorized for equity trades, clearing, and settlement.

Why it matters?

• Represents a strategic step in Mobikwik’s evolution from a digital payments provider to a full-stack fintech platform, enabling it to offer stock trading alongside payments, mutual funds, SIPs, digital gold, and credit services.
• Joins established competitors like Groww, Zerodha, AngelOne, Upstox, and ICICI Direct in the retail broking space.

Background

This is Mobikwik’s second major regulatory approval this quarter—earlier, its Zaakpay arm received RBI authorization as a payment aggregator in April.

What’s Next for Mobikwik?

• MSBPL will seek membership with stock and commodity exchanges.
• Plans include potential expansion into online bond trading.
• The company aims to leverage its existing 176 million users and 4.6 million merchants for broking adoption.

BS

Agriculture

1. Status of Youth in Agrifood Systems: FAO Report

Context:

The Food and Agriculture Organization (FAO) has released its landmark report titled “Status of Youth in Agrifood Systems”, calling for urgent global action to integrate youth into agriculture and food systems. The report shows that global GDP could rise by 1.4% if NEET (Not in Employment, Education, or Training) youth, especially those aged 20–24, are productively engaged — nearly 45% of this potential lies in agrifood systems.

Key Findings

• Declining Youth Participation in Agrifood Systems
  • Youth working in agrifood systems declined from 54% in 2005 to 44%.
  • Despite high reliance on agriculture in low-income countries, youth engagement is falling.
• Rising Global NEET Rates
  • Over 20% of global youth (15–24 years) are NEET.
  • Young women are twice as likely to be NEET compared to young men.
• Economic Impact
  • Eliminating NEET status could raise global GDP by $1.5 trillion.
  • Agrifood systems can contribute to nearly half this growth through job creation and innovation.
• Urbanization and Labour Shortages
  • 54% of youth live in urban areas.
  • Rural youth participation in industrial agrifood systems is only 5%, threatening future agricultural labour availability.
• Climate Vulnerability
  • 395 million rural youth reside in climate-stressed regions with declining agri-productivity.
• Rising Youth Food Insecurity
  • Youth facing moderate or severe food insecurity has risen from 16.7% (2014) to 24.4% (2023), with the sharpest rise in Africa and crisis-hit areas.

FAO’s 3-Pillar Strategy to Empower Youth

Inquire More

• Bridge data gaps on youth in agrifood systems.
• Strengthen evidence for designing youth-responsive policies.

Include More

• Ensure youth representation in policymaking and governance.
• Focus on rural and urban inclusion to avoid intergenerational inequality.

Invest More

• Create Decent Jobs: Promote opportunities in both on-farm and off-farm sectors.
• Modernize Agriculture: Invest in infrastructure, digital tools, and resilient value chains.
• Improve Access: Expand access to land, credit, training, markets, and technology.
• Promote Safe Migration: Enable orderly, dignified migration pathways for youth.

2. Crop Cutting Experiments (CCEs)

Context:

Starting July 2025, the National Statistics Office (NSO) has increased the number of Crop Cutting Experiments (CCEs) conducted across India to improve the accuracy of crop yield estimates. The move is expected to bolster agricultural policy formulation, including export curbs, inflation control, and price management strategies.

Key Highlights:

Objective of the Initiative

• To enhance precision in crop yield estimation for kharif and rabi seasons of 2025–26.
• To provide data-backed insights for policy decisions such as:
  • Export bans
  • Stock limits
  • Futures trading suspensions

What are Crop Cutting Experiments (CCEs)?

A Crop Cutting Experiment is a scientific sampling method used to estimate crop yield by harvesting and weighing a small, randomly selected portion of a crop field. This method ensures statistically reliable estimates of agricultural productivity.

Key Objectives of CCE

• Yield Estimation: Provides accurate per-hectare yield figures.
• Production Forecasting: Supports national and state-level crop output calculations.
• Policy Formulation: Informs decisions on food security, procurement, subsidies, and export-import strategies.

How CCE is Conducted

1. Random Plot Selection
   • Fields and plots are selected using random sampling techniques to avoid bias.
2. Standardized Plot Size
   • Each plot has a fixed size, typically depending on crop and region (e.g., 5m × 5m for wheat).
3. Harvesting & Weighing
   • The selected area is harvested manually.
   • Produce is threshed, cleaned, dried, and weighed to determine yield.
4. Data Compilation & Analysis
   • Yields from multiple CCEs are compiled.
   • Statistical methods are applied to estimate average yields at the district, state, or national level.

Why the Expansion of CCEs?

• Current methods are outdated and do not cover newer, non-traditional crops like:
  • Avocado, dragon fruit, kiwi, berries, etc.
• Existing estimates cover only 25–26 major crops such as rice, maize, jowar.
• Enhanced sample size aims to:
  • Improve statistical confidence levels
  • Capture regional and varietal diversity
  • Address data gaps in horticulture

BS

3.

Facts To Remember

1. Nipah virus resurfaces in Kerala, two cases reported

Nipah virus has returned to Kerala, sparking fresh fear in the State. An 18-year-old girl who succumbed to acute encephalitis syndrome (AES) in Kozhikode two days ago and a 38-year-old woman from Thachanattukara in Palakkad district currently undergoing treatment at a private hospital at Perinthalmanna in Malappuram district have tested positive for the virus.

2. Russia becomes first nation to recognise Taliban regime

Russia on Thursday became the first country to formally recognise the Taliban’s government in Afghanistan since it seized power in 2021, after Moscow removed the group from its list of outlawed organisations.

3. Consistent Gukesh seals top spot in rapid section

D. Gukesh took the honours in the rapid section in the 2025 SuperUnited Rapid & Blitz Croatia in the nation’s capital on Friday, with Poland’s Jan-Krzysztof Duda finishing second.

4. Banking Frauds in India Surge to Record 23,953 Cases in FY25, But Fraud Amount Falls Sharply: RBI

According to the RBI Annual Report 2024-25, the number of banking frauds more than tripled to 23,953 cases in FY25, compared to just 7,359 in FY21. However, the total fraud amount declined by 74% to ₹36,014 crore, indicating a growing trend of low-value, high-frequency frauds—especially in digital banking and card transactions.

Daily Current Affairs Quiz
6&7 July, 2025

International Affairs

1. BRICS Summit in Rio de Janeiro, Brazil

Context:

Prime Minister Narendra Modi is attending the BRICS Summit (July 6–7) in Rio de Janeiro, Brazil, alongside leaders from the original five member countries and the newly inducted members — Egypt, Ethiopia, UAE, Iran, and Indonesia.

Key Highlights from the Summit

• Geopolitical Focus & Terrorism
  • PM Modi will push for a strong joint statement on terrorism, particularly condemning the Pahalgam terror attack and supporting Operation Sindoor.
  • BRICS Foreign Ministers had already included a condemnation in their April 2025 Chair Summary.
  • A robust paragraph in the Leaders’ Joint Statement is expected.
• De-Dollarisation & Local Currency Trade
  • No BRICS currency is being launched.
  • BRICS is promoting voluntary trade in local currencies, not anti-dollar, similar to MERCOSUR’s model.
  • US tariff threats (100–500%) are acknowledged but viewed as misplaced.
• Major Deliverables Expected
  • Climate Change Financing Declaration
  • AI Regulation & Governance Framework
  • Partnership on Socially Determined Diseases (poverty and inequality-driven diseases)
  • Most sessions will be open to partner/invited countries, signaling greater transparency and inclusivity.
• Expansion & Cohesion
  • Saudi Arabia’s membership is still pending.
  • Brazil emphasizes consensus and diversity, not confrontation—supporting BRICS’ Global South character.

India–Brazil Bilateral Engagement

• PM Modi to meet President Lula in Brasilia post-summit.
• Focus areas for enhanced cooperation:
  • Defence, Agriculture, Energy, Pharmaceuticals, Digital tech, and AI.
• Over 110 bilateral missions (trade + govt) conducted in past two years.

TH

National Affairs

1. India and Trinidad & Tobago Sign Key Agreements

Context:

During Prime Minister Narendra Modi’s official visit to Trinidad and Tobago, the two nations signed at least six bilateral agreements, signaling stronger engagement in economic, developmental, and global partnership domains.

Key Highlights:

• Sectoral Cooperation:
  • Financial & Pharmaceutical Ties:
    The agreements will open doors for India’s financial services and pharma sectors to expand in the Caribbean region, positioning India as a key development partner.
• Multilateral Engagements:
  • Trinidad & Tobago joins India’s global initiatives:
    • Coalition for Disaster Resilient Infrastructure (CDRI)
    • Global Biofuel Alliance (GBA)
      These moves align both nations with global sustainability and climate resilience goals.
• Developmental Assistance:
  • Quick Impact Projects (QIPs) Grant Agreement:
    • India to fund up to five short-term projects per year (max $50,000 each).
    • Focused on grassroots development with fast-track execution.
• Education & Digital Transformation:
  • Gift of 2,000 laptops to school students announced by PM Modi.
    • Supports T&T PM Kamla Persad-Bissessar’s digitisation of education vision.
• Agricultural Partnership:
  • India delivered $1 million worth of agro-machinery to NAMDEVCO.
  • Additional support pledged for:
    • Millet cultivation
    • Seaweed-based fertilizers
    • Promotion of natural farming techniques

About Trinidad and Tobago

• Official Name: Republic of Trinidad and Tobago
• Location: Southernmost island country in the Caribbean
• Geography: Comprises two main islands — Trinidad and Tobago — and several smaller islets
• Capital City: Port of Spain
• President: Christine Kangaloo
• Prime Minister: Kamla Persad-Bissessar

TET

2. Nipah Virus (NiV)

Context:

Kerala has once again reported the presence of the Nipah virus, marking the eighth emergence in as many years. While the state has become adept at containing the virus, critical knowledge gaps remain regarding how the virus spills over from bats to humans.

What is Nipah Virus (NiV)?

• Type: RNA virus from the Henipavirus genus, closely related to the Hendra virus.
• Nature: Zoonotic disease — transmitted from animals to humans.
• Natural Host: Fruit bats (Pteropus species), also known as flying foxes, are the natural reservoir.

Transmission Routes

• Direct contact with infected animals (especially pigs)
• Consumption of contaminated food (e.g. raw date palm sap)
• Human-to-human and animal-to-human transmission observed.

Symptoms of NiV Infection

• Acute respiratory illness
• Seizures
• Encephalitis (swelling of the brain)
• Confusion, coma, and potentially death
• Incubation Period
  • Typically 4 to 14 days, but can extend up to 45 days in some cases.
• Fatality Rate
  • 40% to 75%, among the highest for zoonotic infections

Why are NiV outbreaks recurring in Kerala?

1. Endemic status of NiV in fruit bats in Kerala.
2. Proximity of human settlements to forested areas, increasing human-bat contact.
3. Robust healthcare surveillance in Kerala helps identify and report NiV outbreaks early.
   • Other states may be underreporting or missing cases due to weaker surveillance.

3. Gini Index: World Bank Report

Context:

A recent World Bank report ranked India among the most equal countries globally based on its Gini index for 2022–23, pegged at 25.5—placing it fourth after the Slovak Republic, Slovenia, and Belarus. However, economists and policy experts have raised serious concerns about data limitations, sampling flaws, and methodological choices that may understate inequality in the country.

What Is the Gini Index?

• A statistical measure of inequality, ranging from 0 (perfect equality) to 100 (absolute inequality).
• The World Bank report used consumption expenditure data to calculate the Gini index for India.

Key Highlights:

• Gini Index Score:
  • India’s Gini Index (2022–23): 25.5
  • Global Rank: 4th most equal country
  • Countries with better Gini scores:
    1. Slovak Republic
    2. Slovenia
    3. Belarus
• Understanding the Gini Index:
  • Measures income or consumption inequality on a scale from 0 to 100.
  • 0 = Perfect equality, 100 = Absolute inequality (one person has all the income/wealth).
  • India’s score places it in the “moderately low inequality” category (25–30 range).
• Comparative Scores:
  • China: 35.7
  • United States: 41.8
  • UK: 32.4
  • India is close to entering the “low inequality” category (<25).
• Decline in Extreme Poverty:
  • Dropped from 16.2% in 2011–12 to 2.3% in 2022–23
  • Indicates broad-based improvement in living standards across income groups.
• Government Attribution:
  • India’s progress credited to:
    • Welfare schemes and pro-poor policies
    • Expansion of financial inclusion, digital infrastructure, and social safety nets

Decline in Extreme Poverty

• 171 million Indians exited extreme poverty between 2011 and 2023.
• The share of people living on less than $2.15/day dropped from 16.2% (2011–12) to just 2.3% in 2022–23.
• Under the revised World Bank threshold of $3/day, the extreme poverty rate for India is 5.3%.

Drivers of India’s Improved Equality

The steady decline in inequality is attributed to targeted government initiatives that expanded financial inclusion, direct benefit transfers, healthcare access, and rural empowerment. Key programmes include:

• PM Jan Dhan Yojana: Over 55 crore bank accounts opened.
• Aadhaar and DBT: Enabled real-time, targeted welfare delivery, saving ₹3.48 lakh crore.
• Ayushman Bharat: Over 41 crore health cards issued with ₹5 lakh coverage.
• Stand-Up India: ₹62,807 crore sanctioned to SC/ST and women entrepreneurs.
• PMGKAY: Food grains distributed to 80 crore beneficiaries.
• PM Vishwakarma Yojana: Nearly 30 lakh artisans registered for credit and training.

TH, BS & TET

4. India Launches Phenome India “National Biobank”

Context:

Union Minister of State (Independent Charge) for Science & Technology and CSIR Vice President Dr. Jitendra Singh inaugurated the Phenome India National Biobank at CSIR-IGIB in New Delhi. This state-of-the-art facility is a key milestone in India’s effort to build a comprehensive longitudinal health database to facilitate personalised treatment and precision medicine.

About the Phenome India National Biobank

• Modelled after UK Biobank, tailored to India’s diverse population.
• Will collect genomic, clinical, and lifestyle data from 10,000 individuals across India.
• Aims to tackle complex diseases such as:
  • Diabetes
  • Cardiovascular diseases
  • Cancer
  • Rare genetic disorders

Biobank

A biobank is a collection of biological samples (like blood, tissue, or DNA) and associated information (like health records or family history) that are stored and managed for research purposes. They are crucial for advancing medical and health research by providing researchers with access to a large pool of well-characterized samples and data. 

PIB

Banking/Finance

1. PM Jan Dhan Accounts

Context:

In response to rising instances of cyber fraud and money laundering, the Government of India has advised state-owned banks to close inoperative PM Jan Dhan Yojana (PMJDY) accounts that are increasingly being exploited as mule accounts.

Key Developments

• Inoperative Accounts Closure
  • Accounts with no customer-driven transactions for 24+ months are marked as inoperative.
  • Banks are initiating closures of such accounts if KYC is not updated.
  • A nationwide re-KYC drive is underway, especially for older PMJDY accounts.
• Fraud & Mule Account Concerns
  • Inactive accounts are increasingly misused as mule accounts for cybercrime and money laundering.
  • RBI’s Mule Hunter (AI-ML tool) has been deployed to detect such accounts.
• Impact
  • Retail depositors bear the brunt of mule account frauds.
  • The issue highlights the need for policy clarity, improved customer awareness, and stronger account surveillance.

Pradhan Mantri Jan Dhan Yojana (PMJDY)

Launch Date:
August 28, 2014

Objective:
To promote financial inclusion by providing affordable access to:

• Banking/savings accounts
• Remittance services
• Credit
• Insurance
• Pension

Eligibility Criteria

• Must be an Indian citizen
• Age: 18 to 59 years
• Minors above 10 years can open accounts with parental/guardian supervision

Account Features

• Can be opened at any bank branch or Bank Mitr (Business Correspondent) outlet
• Zero balance required to open the account
• Chequebook facility available only if minimum balance is maintained
• Comes with a RuPay debit card for cash withdrawals at ATMs

BS

2. Payments Ecosystem in India

Introduction:

India’s digital payment ecosystem is being powered by multiple platforms—UPI, Aadhaar Enabled Payment System (AePS), Payment Aggregators (PAs), and Prepaid Payment Instruments (PPIs)—each serving distinct use cases but collectively advancing financial inclusion, especially in rural and semi-urban India.

Aadhaar Enabled Payment System (AePS)

• What is AePS?
  • Launched in 2011, AePS allows interoperable banking transactions at micro-ATMs using Aadhaar and biometric authentication.
  • Operated by NPCI, it enables cash withdrawals, deposits, fund transfers, and balance enquiries without a card or phone.
• Scale of AePS (May 2025):
  • Focus area: rural and semi-urban regions.
• Key Issue: Fraud Risk
  • Between Jan 2019–May 2023: ₹585.79 crore lost to fraud out of ₹10,247 crore AePS transactions.
  • RBI’s June 2025 guidelines aim to:
    • Strengthen KYC norms for ATOs (AePS Touchpoint Operators).
    • Mandate periodic monitoring of transaction patterns.
    • Classify ATOs based on risk profile, type (mobile/static), and transaction velocity.
• Corporate-BCs Left Out:
  • RBI guidelines do not address corporate business correspondents, the intermediaries connecting banks to ATOs.

UPI: India’s Flagship Digital Payments Channel

• Overview:
  • Launched in 2016, UPI enables real-time person-to-person and merchant transactions using mobile apps.
  • Users can link multiple bank accounts to one UPI-enabled app.
• Scale of UPI (May 2025):
  • 18.68 billion transactions worth ₹25.14 trillion.
  • Backbone for urban and semi-urban digital commerce.

Challenges in AePS vs. BC Model

• Public Sector Banks (PSBs) still prefer BCs over ATOs, capping AePS transactions to manage cost.
• For example:
  • ATM interchange fee: ₹19 (flat).
• This creates access barriers for customers and defeats AePS’s convenience potential.
• Cash Deposit Interoperability Lag:
  • Only a few banks support interoperable cash deposits via AePS.
  • RBI may explore third-party deposit enablement, allowing Person A to deposit cash into Person B’s account.

Payment Aggregators (PAs)

• RBI has granted in-principle approval to 32 physical PAs.
• Recommendation:
  • Allow QR-code-based cash withdrawal to transform PAs into micro-ATMs.

Prepaid Payment Instruments (PPIs)

• Operators include: Amazon Pay, MobiKwik, Spice Money, Pine Labs, and some NBFCs/banks.
• BBPS Restrictions:
  • Recent RBI guidelines disallow loan EMI payments via wallets funded by credit cards.
  • Issue: Since money is fungible, enforcing source tracking is complex.
  • Recommendation:
    • Allow wallet-based loan repayment (including current dues) to reduce collection costs, especially in microfinance.

Way Forward

India’s digital payment landscape is undergoing rapid transformation:

• UPI has made India a global leader in real-time retail payments.
• AePS ensures last-mile financial access in the rural economy.
• Payment Aggregators and PPIs are filling service gaps in merchant payments and stored value tools.

Yet, to achieve holistic financial inclusion, the RBI must address gaps in:

• Fraud prevention (especially for AePS and ATOs),
• Regulatory parity (for corporate BCs and PPIs),
• Interoperability and transaction caps (especially for PSBs and AePS).

BS

3. The Monetary Multiverse: SBI Report

Context:

A recent report by the State Bank of India (SBI), titled “The Monetary Multiverse”, suggests that subtle cues in RBI Governor Sanjay Malhotra’s speeches and attire may reflect underlying shifts in the central bank’s monetary policy stance. Though intended “on a lighter note,” the analysis reveals interesting patterns in language and visuals that may serve as early indicators of policy direction.

Rise of “Growth” Over “Inflation”

• The word “growth” appeared 24 times in the June 2025 monetary policy statement, signaling a possible tilt toward accommodative policy.
• The speech preceded a 50 basis point rate cut, reinforcing the narrative.
• SBI’s analysts used word clouds to track language shifts in monetary policy communication.
• Increased frequency of “growth” compared to “inflation” typically suggests a pro-growth, dovish stance.

Is the RBI Governor’s Tie a Policy Signal?

SBI’s report introduced a novel concept: “Necktie Nomics”, which explores whether the colour tone of the RBI Governor’s necktie correlates with policy decisions.

Tie Tone Categories and Policy Implications

Tie Tone	Colours Included	Associated Policy Behavior
Warm	Red, Orange, Coral	Hawkish bias; more rate hikes
Cool	Blue, Aqua, Light Blue	Neutral; mostly rate holds
Dark	Black, Navy, Black with Silver	Decisiveness; clear cuts or hikes
Mixed	Purple, Yellow	High volatility, low predictability

• The report assigned:
• 1 for rate hikes
• 0 for hold
• –1 for rate cuts
• It introduced the Tie Volatility and Tilt Index (TVTI), calculated by:

  TVTI = Policy Tilt Score × (1 – Policy Volatility Score)

Recent Example

During the latest 50 bps rate cut, Governor Malhotra wore a dark-toned tie, aligning with the “decisive” signal attributed to such tones.

Communication Matters in Central Banking

• SBI emphasized that the analysis is not a substitute for traditional economic models, but rather a complementary tool to interpret central bank behavior in a hyper-communicative world.
• Visual and verbal cues, though unconventional, could offer early context on monetary policy tilt when supported by data.

Key Takeaways

• Linguistic shifts, such as an emphasis on “growth,” may signal easing in monetary policy.
• Non-verbal signals (like necktie colours) could reflect policy mood or intent.
• Such creative methods, though informal, can enhance market understanding of central bank behavior in real-time.
• SBI underlines that these observations are pattern-based, not predictive, and should be interpreted cautiously.

BS

4. IBC Cannot Override PMLA on Attached Assets: NCLAT Ruling

Context:

The National Company Law Appellate Tribunal (NCLAT) has ruled that the Insolvency and Bankruptcy Code (IBC) cannot override the Prevention of Money Laundering Act (PMLA) when it comes to assets attached by the Enforcement Directorate (ED) as proceeds of crime.

Context of the Ruling

• Under Section 14 of the IBC, a moratorium is imposed on the debtor’s assets during insolvency resolution proceedings.
• However, if assets have been attached by the ED under PMLA and such attachment is confirmed by a competent authority, they cannot be included in the resolution estate.

NCLAT Observations

• Section 238 of the IBC, which gives the Code overriding powers, does not apply to assets attached under PMLA in cases involving proceeds of crime.
• The tribunal clarified that IBC and PMLA operate in different domains and there is no irreconcilable inconsistency between them.
• The ED is not a creditor, but a public enforcement agency acting to uphold penal laws and international obligations, including under the FATF and UN conventions.

Implications of the Ruling

• Assets attached by ED and adjudicated as proceeds of crime cannot be made available for corporate resolution under IBC.
• The ruling upholds the decision of the National Company Law Tribunal (NCLT) which had earlier rejected the inclusion of such attached assets in a resolution plan.

TET

5. Public Sector Banks May Scrap Minimum Balance Penalties

Context:

In a significant policy shift, public sector banks (PSBs) are reconsidering the need for minimum balance requirements in savings accounts, following discussions with the Finance Ministry. This move comes amid concerns over the declining share of Current Account and Savings Account (CASA) deposits in overall bank liabilities.

Key Developments

• Banks that have scrapped the requirement recently:
  • Canara Bank
  • Bank of Baroda
  • Punjab National Bank
  • Indian Bank
• No penalty will be levied on customers for non-maintenance of minimum balance.
• The Finance Ministry questioned the rationale of penalizing customers, especially at a time when low-cost deposits are falling.

Context and Rationale

• As per RBI’s June 2025 Financial Stability Report, the share of CASA deposits is declining, while banks are relying more on high-cost term deposits and certificates of deposit (CDs).
• Jan Dhan Yojana (PMJDY) account performance showed that even dormant accounts gradually accumulated balances, encouraging banks to rethink the relevance of minimum balance norms.
• SBI had already removed this requirement in 2020 after public backlash, especially following RTI revelations that penalty collections exceeded net profit in some years.

Changing Banking Economics

• Traditionally, savings accounts were a source of low-cost funds used to cross-subsidize free banking services.
• However, digital banking has reduced service costs, prompting banks to seek alternative sources of cost recovery:
  • Debit card charges
  • Fees for exceeding free transaction limits
• Private banks, though generally stricter, often waive minimum balance requirements on:
  • Salary accounts
  • Accounts meeting a broader “relationship value” threshold (e.g., FDs, mutual funds)

Mint

6. LIC Launches Nav Jeevan Shree Plans 911 & 912

Context:

Life Insurance Corporation of India (LIC) launched two new non-linked, non-participating endowment insurance plans effective July 4, 2025:

• Nav Jeevan Shree Regular Premium Plan (Plan 912)
• Nav Jeevan Shree Single Premium Plan (Plan 911)

These plans offer guaranteed returns and insurance protection, tailored to suit a range of financial planning goals.

Plan 912 – Nav Jeevan Shree (Regular Premium)

• Type: Limited premium endowment plan
• Premium Payment Terms: 6, 8, 10, or 12 years
• Policy Term: 10 to 20 years
• Guaranteed Additions: 8.5% to 9.5% of annual premium based on term
• Entry Age: 30 days to 60 years
• Minimum Sum Assured: ₹5 lakh (no maximum limit, subject to underwriting)

Key Features:

• Suitable for long-term financial planning
• Provides both life cover and savings
• Guaranteed returns enhance maturity benefit

Plan 911 – Nav Jeevan Shree (Single Premium)

• Type: Single premium endowment plan
• Premium Payment Mode: One-time lump sum
• Policy Term: 5 to 20 years
• Guaranteed Additions: ₹85 per ₹1,000 sum assured per year
• Entry Age:
• Option I: 30 days to 60 years
• Option II: 30 days to 40 years
• Minimum Sum Assured: ₹1 lakh

Key Features:

• Ideal for investors with surplus funds
• Fixed guaranteed additions annually
• Life cover throughout policy term

TOI

7. SEBI Proposes Dedicated Electronic Book Provider (EBP) Platform for NPOs on SSE

Context:

The Securities and Exchange Board of India (SEBI) has proposed a new framework to enhance fundraising mechanisms for not-for-profit organisations (NPOs) through the Social Stock Exchange (SSE).

What is SSE-EBP?

• The Securities and Exchange Board of India (SEBI) has proposed a dedicated Social Stock Exchange Electronic Book Provider (SSE-EBP) platform to enable fundraising by Not-for-Profit Organisations (NPOs).
• It will streamline issuance of Zero Coupon Zero Principal (ZCZP) instruments and other SEBI-approved securities.

Key Features:

Applicability

• Mandatory for NPOs raising ₹50 lakh or more in a single or shelf issuance.
• Open to Qualified Institutional Buyers (QIBs), Non-Institutional Investors, and Retail Investors.
• Foreign Portfolio Investors (FPIs) are not allowed to participate.

Bidding & Allotment Mechanism

• Bidding through an anonymous pooling system from 9 AM to 5 PM on working days, aligned with stock exchange timings.
• Allotment will follow first-come-first-serve (FCFS) or pro-rata basis.

Issuer Responsibilities

Issuers must file a Draft Fund Raising Document (DFRD) and Term Sheet outlining:

• Issue size
• Project details
• Bid terms
• Minimum application size
• Mode of allotment
  Submission deadlines:
• 2 days prior to issue for repeat issuers
• 5 days prior for first-time issuers

Penalties for Non-compliance

• Successful bidders who fail to make payment face a 30-day debarment.
• Issuers withdrawing issues without valid reason face a 7-day debarment unless exceptions apply (e.g., <75% subscription).

Objective and Benefits

• The platform aims to improve transparency, standardisation, and access to social sector funding.
• Aligns NPO fundraising with capital market infrastructure.
• Promotes confidence among institutional and retail investors.

TET

Agriculture

1. Dvara E-Registry Launches Micro Loan Against Property (Micro LAP) for Agri Stakeholders

Context:

Agri-fintech start-up Dvara E-Registry has launched a new Micro Loan Against Property (Micro LAP) product aimed at delivering secured, asset-backed credit to small and marginal farmers and other participants in India’s agricultural value chain.

Key Highlights:

• Product Purpose:
  • Provides longer-term, secured credit using immovable assets as collateral.
  • Targets agri-entrepreneurs and farmers for enterprise growth, diversification, and livelihood stability.
  • Expands beyond traditional short-tenure farm loans.
• Tech-Driven Credit Model:
  • KhetScore:
    • AI-powered, satellite-based credit scoring engine.
    • Analyzes crop health, land use, and irrigation to assist lenders.
  • Doordrishti Platform:
    • Integrates FPOs, farmers, agri-input providers, buyers, and lenders.
    • Ensures transparency, connectivity, and efficiency in the agri-value chain.

Significance

• Promotes financial inclusion for smallholders in agriculture.
• Enables asset-backed lending in underserved rural areas.
• Strengthens India’s agri-fintech and FPO ecosystem.
• Bridges the credit gap with data-driven lending decisions.

BL

2. Country’s First Honeybee Flora Park (Beekeeping Centre)

Context:

The Honeybee Flora Park at Kallimel, near Mavelikara, under the Kerala State Horticultural Products Development Corporation (Horticorp), is emerging as a major hub for honey production, farmer training, and now tourism, with plans to set up a museum and laboratory.

Key Highlights:

• Operational Overview:
  • Launched: 2018
  • Location: 3-acre campus in Thazhakara grama panchayat
  • Honey Procured: Over 50,000 kg from local farmers
  • In-house Production: Around 2 tonnes annually from 200 beehives (stingless and Indian honeybees)
• Three Core Functions:
  1. Honey Production and Beekeeping
  2. Procurement and Scientific Processing of farmer-produced honey
  3. Farmer Training and Capacity Building
• Branding and Product Line:
  • Honey is sold under the “Amruth Honey” brand (pack sizes: 50g to 5kg)
  • Value-added products include honey soap and other derivatives
• Training & Farmer Support:
  • 1,500+ farmers trained to date
  • Trained farmers eligible for 40% subsidy on beehives and equipment via Central/State schemes
• New Developments:
  • Honey Museum:
    • Planned to boost tourism and educational outreach
    • Aims to showcase beekeeping history, biodiversity, and honey production
  • Quality Testing Laboratory:
    • Approved for setup
    • Construction to begin within two months
    • Will provide scientific validation for honey quality

Significance

This model supports rural livelihoods, promotes scientific beekeeping, ensures fair pricing for farmers, and integrates eco-tourism to raise awareness on pollination, biodiversity, and sustainable agriculture.

3. Kerala Signs Landmark MoU to Accelerate Climate-Resilient Farming

Context:

In a decisive move to strengthen climate resilience in agriculture, the Kerala Climate Resilient Agri Value Chain Modernization Project (KERA) has signed a Memorandum of Understanding (MoU) with Kerala Agricultural University (KAU). The agreement, signed on July 6, 2025, seeks to institutionalize advanced, low-emission, climate-smart farming practices across Kerala’s varied agro-climatic zones.

Key Objectives of the MoU:

• Mainstream Climate-Resilient Agriculture (CRA): The MoU sets the stage for scaling CRA technologies that reduce emissions and enhance farm productivity amid growing climate risks.
• Leverage Scientific Expertise: KAU will provide research-driven insights, while KERA ensures grassroots-level implementation via farmer networks and institutional support.

Major Initiatives under the Partnership:

• Modernisation of Soil Testing Infrastructure:
  • Laboratories across the state will be upgraded to provide real-time soil health diagnostics, enabling precise nutrient management.
• Climate-Smart Crop Advisories:
  • Development of AI and data-enabled crop advisories tailored to seasonal climate patterns, supported by a new Kerala Agro Climate Research Centre to be established at KAU.
• Promotion of Low-Carbon Farming:
  • Emphasis on water-saving paddy cultivation methods such as Alternate Wetting and Drying (AWD) will be piloted in key paddy-growing districts.
• Capacity Building and Digital Tools:
  • Training programs for farmers and extension workers will be rolled out, backed by ICT-based platforms for continuous learning and decision support.

BL

4. India to Launch First Weather Derivatives

Context:

To enhance climate resilience in agriculture, the National Commodity & Derivatives Exchange (NCDEX) signed a Memorandum of Understanding (MoU) with the India Meteorological Department (IMD) for the development of rainfall-based weather derivatives—a first for India.

Key Highlights:

• Purpose of the MoU:
  • Develop and introduce weather-based derivative products, starting with rainfall-linked contracts, to help stakeholders hedge against climate-related risks.
• Why It Matters:
  • Over 70–90% of India’s rainfall occurs during the monsoon, impacting crops, transportation, and agri-value chains.
  • Current insurance models are slow and coverage-limited. Derivatives provide faster, market-driven risk mitigation.
• Data Support from IMD:
  • IMD will provide:
    • Historical rainfall data (to assess flood/drought-prone areas).
    • Real-time rainfall in gridded and point formats (for current season risk assessment).
    • Climate deviation analysis to support agri-business decisions.
• Sectors to Benefit:
  • Farmers and FPOs
  • Agri-traders and logistics firms
  • Policymakers and insurers
• Broader Impact:
  • Facilitates seasonal and location-specific weather contracts.
  • Supports agriculture, transport, tourism, and allied industries.
  • Promotes climate-resilient finance instruments for rural India.
• Future Steps:
  • Capacity-building for stakeholders.
  • Joint research and development of temperature- and wind-based products.
  • Potential policy and regulatory backing from SEBI and the Ministry of Agriculture.

BL

Facts To Remember

1. BoB waives charges on non-maintenance of monthly average balance

The state-owned lender, Bank of Baroda, announced a complete waiver on all charges for non-maintenance of the Monthly Average Balance (MAB) in its standard savings account schemes, effective 1 July 2025, the bank said in a press note.

2. India’s First National Cooperative University in Gujarat

Union Minister Amit Shah laid the foundation stone for Tribhuvan Sahkari University, India’s first national cooperative university, at Anand, Gujarat—the birthplace of Amul and a historic centre of India’s cooperative movement.

• University Overview:
  • Name: Tribhuvan Sahkari University
  • Location: Anand, Gujarat
  • Named after: Tribhuvandas Kishibhai Patel, founder of Amul and pioneer of India’s cooperative movement
  • Institutional Goal: Strengthen India’s cooperative ecosystem by producing trained professionals

Daily Current Affairs Quiz
8 July, 2025

International Affairs

1. Colombia and Uzbekistan Join New Development Bank (NDB)

Context:

Colombia and Uzbekistan have become the latest members of the New Development Bank (NDB), also known as the BRICS Bank. The announcement was made ahead of the 17th BRICS Summit, during the 10th meeting of the NDB’s Board of Directors. The addition brings the total membership to 11 countries.

Current Members of NDB

• Founding BRICS Nations (2015):
  • Brazil
  • Russia
  • India
  • China
  • South Africa
• New Members:
  • Bangladesh
  • United Arab Emirates
  • Egypt
  • Algeria
  • Colombia
  • Uzbekistan

About the NDB

• Established: 2015
• Headquarters: Shanghai, China
• Purpose: Mobilize resources for infrastructure and sustainable development in BRICS and other emerging/developing economies

National Affairs

1. India’s SDG-4 Education Progress Report 2025

Context:

The National Indicator Framework (NIF) Progress Report 2025 was released on the occasion of the 19th National Statistics Day. It tracks India’s progress on the 17 Sustainable Development Goals (SDGs) using 284 national indicators.

Key Highlights:

• Report by: Ministry of Statistics and Programme Implementation (MoSPI)
• Coverage: 284 indicators across 17 SDGs (down from 290 in 2024)
• Reference Period: Data from 2015–16 to 2024–25

National Indicator Framework (NIF) Report 2025

• Social Protection Coverage: Rose from 22% in 2016 to 64.3% in 2025.
• Senior Citizens Supported: Institutional assistance increased from 23,000 (2015) to 1.57 lakh (2023–24).
• Agricultural Productivity: GVA per agricultural worker grew from ₹61,247 (2015–16) to ₹94,110 (2024–25).
• Inequality Decline (Gini Coefficient):
  • Rural: 0.283 → 0.237
  • Urban: 0.363 → 0.284
• Forest Cover: Increased from 21.34% (2015) to 21.76% (2023).
• Tertiary Education Gross Enrolment Ratio: Improved from 23.7% (2015–16) to 29.5% (2022–23).
• Renewable Energy Share: Rose to 22.13% (2024–25) from 16.02% (2015–16).

UNESCO SDG-4 Scorecard 2025 (Education Focus)

• Foundational Literacy Challenge:
  • India is off-track by 11 percentage points in minimum reading proficiency at primary level.
  • Benchmark: 56%, Actual: ~45%
• Teacher Training Shortfall:
  • Pre-primary trained teacher benchmark: 88%, progress lagging.
• Education Financing Gap:
  • India’s public expenditure on education: 3.1% of GDP (2023)
  • SDG benchmark: 4%, NEP 2020 target: 6%
• Upper Secondary Participation Low:
  • Out-of-school youth (15–17 yrs): 21%, vs. South Asia’s 13%, HICs < 2%
• Gender Parity:
  • Fast progress in upper secondary completion
  • India’s gender gap: 2.3%, better than South Asia’s 3.4%

Facts

Indicator	2025 Status	Benchmark / Change
Social protection coverage	64.3%	↑ from 22% (2016)
GVA per agri-worker	₹94,110	↑ from ₹61,247 (2015–16)
Rural Gini coefficient	0.237	↓ from 0.283 (2011–12)
Reading proficiency (primary)	~45%	Benchmark: 56%
Education spending (GDP share)	3.1%	Target: 4%–6%
Renewable energy share	22.13%	↑ from 16.02% (2015–16)

TOI & BS

2. Digital Census 2027: India’s First Tech-Driven Population Survey

Context:

The Registrar-General of India (RGI) has announced that the 2027 Census will be India’s first fully digital Census, leveraging mobile technology and self-enumeration portals to ensure faster data availability and improved accuracy.

Key Highlights:

• First Digital Census:
  • For the first time, the Census will be conducted using technology to collect and transmit data electronically to the central server, enabling quicker compilation and processing.
• Two-Phase Census:
  • The exercise will be conducted in two phases, with the option for residents to self-enumerate in both.
• Self-Enumeration Option:
  • Citizens will be able to participate via a dedicated web portal, making the process more participatory and accessible.
• Mobile App Usage:
  • Enumerators will use a Mobile App (available on Android & iOS) to collect data in English, Hindi, and regional languages.

TH

3. India’s Maternal Mortality Ratio (MMR)

Context:

India’s Maternal Mortality Ratio (MMR) stands at 93 per 1 lakh live births (SRS 2019–21), showing notable improvement. However, regional disparities and healthcare system gaps persist, especially in Empowered Action Group (EAG) states.

Key Highlights:

Definition and Measurement

• Maternal Mortality Ratio (MMR): Number of maternal deaths per 100,000 live births.
• Maternal Death (WHO): Death of a woman during pregnancy or within 42 days of termination due to pregnancy-related causes.

MMR Data (2019–21)

• India’s MMR: 93
• Lowest MMR: Kerala (20)
• Highest MMR: Assam (167)
• Southern states outperform EAG states (e.g., Bihar, UP, MP, Odisha).

Why MMR Matters

• Public Health Barometer: Reflects healthcare access, gender equity, emergency care systems.
• SDG 3.1 Target: Reduce global MMR to <70 by 2030 — India needs faster progress.
• Avoidable Tragedy: Majority of maternal deaths are preventable with timely obstetric care.

Key Challenges

• Three Delays Model (Deborah Maine Framework):
  • Delay in Decision: Due to social stigma, ignorance, or poor family support.
  • Delay in Transit: Especially in tribal, hilly, or remote areas.
  • Delay in Treatment: Lack of specialists, surgical readiness, blood availability.
• Infrastructure Bottlenecks:
  • Only 2,856 out of 5,491 Community Health Centres (CHCs) function as First Referral Units (FRUs).
  • 66% shortage of specialists in public health facilities.
• Medical Causes of Maternal Deaths:
  • Postpartum haemorrhage, hypertensive disorders, sepsis, obstructed labour, unsafe abortions.
• Underlying Risk Factors
  • Anaemia, malnutrition, and comorbidities (e.g., TB, malaria, UTIs) are prevalent among pregnant women in vulnerable states.

Government Initiatives

1. Janani Suraksha Yojana (JSY):
   • Cash incentives for institutional deliveries.
   • Incentives to ASHAs for mobilising pregnant women.
2. Janani Shishu Suraksha Karyakram (JSSK):
   • Free transport, medicines, diagnostics, and delivery care at public hospitals.
3. FRU Strengthening:
   • Goal of minimum 4 FRUs per district, with specialists and blood storage.
4. Maternal Death Reviews (MDRs):
   • Mandatory under National Health Mission (NHM) to identify and correct gaps.
5. Kerala’s Confidential Maternal Death Reviews:
   • Focus on clinical audits, training, and facility preparedness (e.g., use of uterine clamps, embolism protocols) — key to Kerala’s low MMR.

TH

4. National Overseas Scholarship (NOS)

Context:

The Ministry of Social Justice and Empowerment has withheld provisional award letters for 66 out of 106 selected candidates under the National Overseas Scholarship (NOS) scheme for FY26, citing shortage of funds.

About the National Overseas Scholarship (NOS) Scheme

• Scheme Type:
  • Central Sector Scheme under the Ministry of Social Justice and Empowerment.
• Objective:
  • To support students from marginalised and economically weaker sections in pursuing Master’s and Ph.D. programs abroad, enhancing their social and economic mobility.

Target Beneficiaries

• Scheduled Castes (SCs)
• Denotified, Nomadic & Semi-Nomadic Tribes
• Landless Agricultural Labourers
• Traditional Artisans

Eligibility Criteria

Criteria	Details
Education	Master’s: Bachelor’s with ≥ 60%Ph.D.: Master’s with ≥ 60%
Age Limit	Not more than 35 years as of April 1 of the selection year
Income Limit	Annual family income ≤ ₹8 lakh
University	Unconditional admission to Top 500 QS-ranked universities
Other Conditions	– Not already studying or settled abroad – Max two children per family eligible

Key Features

• Total Annual Slots: 125
  • 115 for SCs
  • 6 for Denotified Tribes
  • 4 for Agricultural Labourers/Artisans
• 30% reservation for women candidates.
• Two-Phase Selection Process:
  • Phase 1: Candidates with admission in QS Top 500 institutions.
  • Phase 2: Broader eligibility including QS-ranked or recognised global institutions.
• State-wise Cap: No more than 10% of slots per state to promote geographic diversity.
• Conditional Funding Clause: If funding is insufficient, fewer award letters are issued despite selection.

TH

5. Northeast District SDG Index 2023–24: NITI Aayog

Context:

The NITI Aayog, in collaboration with the Ministry of Development of Northeastern Region (MDoNER) and supported by the United Nations Development Programme (UNDP), released its 2023–24 Northeast District SDG Index. The report highlights a sharp rise in the share of ‘front runner’ districts, signaling significant progress in localising Sustainable Development Goals (SDGs) across India’s Northeastern states.

Key Highlights:

Overall Performance

• Front Runner Districts (SDG Score 65–99):
  • 2021–22: 62% of NE districts
  • 2023–24: 85% of NE districts
• A district is labelled “Performer” if it scores between 50 and 64.9.

Top-Performing Districts (2023–24)

Rank	District	State	SDG Score
1	Hnahthial	Mizoram	81.4
2	Champhai	Mizoram	79.8

State-Wise Performance

• All districts in Mizoram, Sikkim, and Tripura are now in the ‘Front Runner’ category.
• Significant improvements in Meghalaya (from 1 to 10 front runner districts).

State	2021–22 Front Runners	2023–24 Front Runners
Arunachal Pradesh	13	16
Assam	23	31
Manipur	8	12
Meghalaya	1	10
Mizoram	7	11
Nagaland	N/A	9
Sikkim	4	6
Tripura	8	8

Areas of Concern

Despite the overall rise, decline in front runner status was noted for:

• SDG 7: Affordable and Clean Energy
• SDG 10: Reduced Inequalities
• SDG 12: Responsible Consumption and Production

About the Index

• Edition: Second (first released in August 2021)
• Coverage:
  • 2021: 103 of 120 districts
  • 2023: 121 of 131 districts (92%)
• Indicators: 84 in total
  • 41 from central ministries
  • 43 from state sources
• Provides granular, district-level tracking of progress on all 17 SDGs

PIB

Banking/Finance

1. SEBI Proposes Relaxation of Broad-Basing Norms for Mutual Funds

Context:

The Securities and Exchange Board of India (SEBI) has issued a consultation paper proposing relaxation of the broad-basing requirement for pooled investment funds, following representations by the Association of Mutual Funds in India (AMFI) and other industry stakeholders.

What Are Non-Broad-Based Funds?

• Funds with fewer than 20 investors or where one investor holds more than 25% of the corpus.
• Previously, SEBI regulations favored broad-based funds to mitigate risks related to preferential treatment or insider dealings.

Key Proposals by SEBI

• Advisory Services via Separate Unit
  • AMCs will be allowed to offer advisory services to pooled funds (with fewer than 20 investors or a single investor holding over 25% of the corpus) through a distinct and ring-fenced unit with dedicated personnel and separate infrastructure.
• Target Funds
  • Covers pooled non‑broad‑based funds, including offshore institutional funds and family-office structures that didn’t qualify as broad-based.
• Governance & Conflict Safeguards
  SEBI’s proposal includes:
  • Defined trade allocation and disclosure policies
  • Bans on performance-linked fee structures
  • Adherence to insider-trading norms
  • Operational segregation to prevent conflicts between mutual fund operations and advisory services
• Expanded Ancillary Services
  • AMCs and their subsidiaries may also:
    • Serve as global distributors of their investment vehicles
    • Act as Points of Presence (PoP) for pension schemes (in compliance with PFRDA guidelines)
    • Undertake fund distribution and marketing activities aligned with fund management

Why It Matters

• Business Expansion: Facilitates entry into institutional advisory and structured products
• Investor Choice: Allows high-net-worth individuals, family offices, and foreign partners to access AMC expertise
• Regulatory Balance: Ensures investor protections and market integrity while enabling AMCs to diversify

BS & TET

2. NPCI to Launch IoT-Enabled UPI Payments

Context:

The National Payments Corporation of India (NPCI) is developing an IoT (Internet of Things)-ready version of UPI, aimed at enabling autonomous payments via smart devices such as wearables, connected vehicles, and home appliances. This innovation is part of NPCI’s 2025 roadmap and supports its goal of tenfold growth in UPI transactions.

Key Highlights:

What’s Happening?

• The National Payments Corporation of India (NPCI) is developing an IoT-ready version of UPI.
• Smart devices like refrigerators, washing machines, smartwatches, connected cars, and smart TVs will soon be able to initiate UPI transactions independently — for example, paying for parking, metro tickets, or renewing subscriptions automatically.

How It Will Work

1. Device-specific UPI IDs
   • Each device will be assigned a unique virtual payment address, linked to the user’s main UPI account.
2. Payment Mandates and AutoPay Features
   • Implementation of delegated payment frameworks such as UPI Circle and AutoPay.
   • Users will be able to define mandates and transaction limits per device for better control.
3. Security and User Authorization
   • Transactions will require pre-approved mandates, OTPs, or device-based authentication.
   • NPCI plans to implement strict safeguards to manage risks and prevent unauthorized use.

Why It Matters

• For NPCI: Supports its goal of 10x expansion in UPI use cases and penetration.
• For Consumers: Enables seamless, contactless payments through everyday smart devices.
• For India: Boosts its role as a pioneer in embedded financial infrastructure, enhancing digital adoption and financial inclusion.

The Internet of Things (IoT)

The Internet of Things (IoT) refers to a network of physical objects embedded with sensors, software, and other technologies that enable them to connect and exchange data with other devices and systems over the internet. Essentially, it’s about making everyday “things” smart and interconnected, allowing them to communicate and automate tasks, often without human intervention. 

BS

3. SEBI to Intensify Surveillance on Derivatives Trading

Context:

SEBI Chairman Tuhin Kanta Pandey, speaking at a public event on Monday, announced that the regulator will strengthen surveillance mechanisms for India’s derivatives market. This comes in the backdrop of recent regulatory action against high-frequency trading firm Jane Street.

Key Highlights:

Focus on Derivatives Oversight

• SEBI plans to tighten surveillance frameworks for derivatives trading on both:
  • Stock exchanges
  • Regulator’s internal systems
• The move aims to detect and deter:
  • Market manipulation
  • Abuse of algorithmic and high-frequency trading (HFT)
  • Insider trading and front-running

Jane Street Case as a Trigger

• SEBI’s action against Jane Street, a U.S.-based HFT firm, was termed a “surveillance matter”.
• The firm allegedly engaged in abusive trading patterns that warranted regulatory scrutiny.

BS

4. Expand Financial Inclusion Using AI and Fintech Innovation: DFS Secretary

Context:

At the CII’s 3rd Financial Inclusion and Fintech Summit (New Delhi, July 7), M. Nagaraju, Secretary of the Department of Financial Services (DFS), urged fintech firms to deepen financial inclusion by leveraging Artificial Intelligence (AI) and digital innovation, while also strengthening fraud and cyber risk management.

Key Highlights:

DFS Push for AI-Led Financial Inclusion

• Fintechs should:
  • Use AI and digital tools to expand access to financial services.
  • Develop fraud detection and cybersecurity solutions to safeguard digital finance ecosystems.
• Fintechs were encouraged to lead innovation in onboarding, authentication, fraud mitigation, and financial literacy.

Financial Inclusion & SDGs

• 7 out of 17 UN Sustainable Development Goals (UNSDGs) are directly linked to financial inclusion.
• Financial inclusion is critical to:
  • Poverty alleviation
  • Economic growth
  • Social empowerment

Progress in India’s Financial Inclusion (2014–2024)

Indicator	Before 2014	As of 2024
Adult bank account access	35%	99%
Jan Dhan accounts opened	Lakhs	Over 50 crore

• Key schemes cited:
  • Pradhan Mantri Jan Dhan Yojana (PMJDY)
  • Pradhan Mantri Suraksha Bima Yojana
  • PM Swanidhi Yojana
  • Atal Pension Yojana

BS

5. Rupee Weakens Sharply Amid Trump Tariff Threats and Dollar Strength

Key Highlights

• Rupee closed at 85.86 per USD, down by 47 paise on Monday.
• During intraday trade, it breached the 86-mark, touching 86.03 before mild recovery.
• The partial recovery is attributed to RBI intervention via dollar sales.

Trigger: Trump’s Tariff Announcement

• Former U.S. President Donald Trump announced a 10% tariff on countries aligning with BRICS (Brazil, Russia, India, China, South Africa).
• He labelled such alignments as “anti-American”, causing global trade jitters.
• The 90-day tariff suspension window is also set to expire, with no new trade deal signed yet.

Other Contributing Factors

• Strong demand for dollars by a major private bank put further pressure on the rupee.
• Stop-loss orders were triggered once the rupee crossed 85.80, leading to more depreciation.
• The Dollar Index rose to 97.36 from 96.95, strengthening the greenback against a basket of six currencies.

6. SEBI Reviewing AIF Norms

Context:

The Securities and Exchange Board of India (SEBI) is re-evaluating its December 13, 2024 circular on Alternative Investment Funds (AIFs) after fund managers, legal advisors, and investors raised concerns about the rules’ inflexibility and impact on existing structures.

Key Features of the 2024 Circular:

Core Principles Introduced

• Pro-rata Rights:
  • Profits and losses must be shared proportionally to each investor’s committed capital.
• Pari-passu Rights:
  • All investors must be treated equally in terms of drawdowns and return distributions, unless an exemption applies.

Objective

• Ensure fairness, transparency, and uniformity in investor treatment within AIFs.
• Bring clarity to waterfall distribution models and preferential rights often used in legacy and global investor structures.

What Are Alternative Investment Funds (AIFs)?

Alternative Investment Funds (AIFs) are privately pooled investment vehicles that raise funds from investors to invest in non-traditional assets such as private equity, venture capital, hedge funds, infrastructure, and social impact ventures. These differ from conventional instruments like stocks and mutual funds and are governed under the SEBI (Alternative Investment Funds) Regulations, 2012.

Legal Structure:

AIFs in India can be formed as:

• Trusts
• Limited Liability Partnerships (LLPs)
• Companies
• Other permissible entities

Types of AIFs in India

Category I: Growth-Oriented and Impact Investments

Focus: Promote innovation, start-ups, SMEs, and social impact.

• Venture Capital Funds (VCFs): Finance high-growth start-ups; high risk, high return.
• Angel Funds: Early-stage funding with ₹25 lakh minimum per investor.
• Infrastructure Funds: Invest in sectors like transport, energy, and urban development.
• Social Venture Funds: Support impact-driven ventures in health, education, etc.

Category II: Private and Debt-Oriented Funds

Focus: Invest in private equity and debt without leverage.

• Private Equity (PE) Funds: Back unlisted firms with long lock-in periods.
• Debt Funds: Invest in unlisted debt securities with strong governance.
• Fund of Funds (FoFs): Invest in units of other AIFs for diversified exposure.

Category III: High-Risk, Market-Linked Strategies

Focus: Aggressive strategies, including leverage and arbitrage.

• PIPE Funds: Buy publicly traded shares at discounted prices.
• Hedge Funds: Invest in domestic/global markets using derivatives and leverage; high fee structure (typically 2% management + 20% performance fee).

Investor Eligibility and Requirements:

• Who Can Invest: Resident Indians, NRIs, foreign nationals.
• Minimum Investment: ₹1 crore (₹25 lakh for fund managers, employees, directors).
• Lock-in Period: Minimum 3 years.
• Investor Cap: Max 1,000 investors per scheme (49 for Angel Funds).

Mint

Economy

1. Jan Vishwas Bill 2.0

Context:

The Government of India is considering incorporating Section 27 of the MSMED Act, 2006 into the proposed Jan Vishwas Bill 2.0, aiming to decriminalize minor offences related to non-disclosure of business information by Micro, Small and Medium Enterprises (MSMEs).

Key Highlights:

• Objective
  • Reduce compliance burden and decriminalize petty economic offences to promote ease of doing business.
  • Plug financial leakages faced by MSMEs due to minor penalties.
• Background
  • Jan Vishwas Bill 2.0 was announced in the FY26 Budget by Finance Minister Nirmala Sitharaman.
  • It will decriminalize 100 more laws, following the first Jan Vishwas Bill (2023) that decriminalized 180 provisions.
• Focus on MSMEs
  • India has over 65 million registered MSMEs, contributing:
  • 30% to GDP
  • 45% to exports
  • MSMEs often face penalties for minor non-compliance, which can impact capital flow and growth.

Section 27 of the MSMED Act

• Provision: Penalizes MSMEs for non-disclosure of business-related information to central or state authorities.
• Penalty structure:
  • ₹1,000 for failure to furnish required information.
  • Fines range from ₹1,000 to ₹10,000 depending on the nature of non-compliance.

Policy Impact

• Reduces fear of prosecution for small businesses.
• Promotes trust-based governance and voluntary compliance.
• Frees up resources for MSMEs to focus on operations and innovation.

Mint

Agriculture

1. Urea: A Key Fertilizer in Indian Agriculture

Context:

The Department of Fertilizers has prohibited fertiliser companies from planning any plant shutdowns in FY2025–26, citing the need to ensure adequate urea availability during both kharif and rabi seasons. The directive was issued via a government note dated July 3, 2025, shared with top urea manufacturers.

About Urea

Urea is the most widely used nitrogenous fertilizer in India and globally. With a high nitrogen content (46%), it plays a crucial role in enhancing plant growth and increasing crop yields. Amid rising concerns over fertilizer shortages and import dependency, understanding urea’s utility and proper usage is vital.

Key Features of Urea Fertilizer

• Primary Nitrogen Source: Urea provides nitrogen—a critical nutrient for vegetative growth, particularly in cereals and high-yield crops.
• High Nutrient Efficiency: Contains 46% nitrogen by weight, making it highly efficient and cost-effective.
• Mechanism of Action:
  • Undergoes hydrolysis and nitrification in soil to release nitrogen as ammonium (NH₄⁺) and nitrate (NO₃⁻), both absorbable by plants.
• Enhanced Crop Yields: Boosts foliage development, chlorophyll synthesis, and overall productivity.
• Versatility: Suitable for a wide range of crops and climatic zones.
• Other Uses: Also used in animal feed, resins, adhesives, and pharmaceuticals.

Best Practices in Urea Application

• Proper Application: Apply based on crop-specific requirements to avoid overuse.
• Soil Incorporation: In dry or warm climates, mix into soil to minimize nitrogen loss via volatilization.
• Timing & Placement:
  • Apply during key vegetative stages for maximum uptake.
  • Avoid surface application before rainfall or irrigation to reduce leaching.
• Avoiding Overuse: Excess nitrogen may lead to:
  • Soil acidification
  • Water pollution (nitrate leaching)
  • Increased greenhouse gas emissions (N₂O)

Challenges & Environmental Considerations

• Nitrogen Loss: Up to 50% nitrogen can be lost due to volatilization or leaching if poorly managed.
• Pollution Risk: Improper use contributes to eutrophication in water bodies and air pollution via ammonia volatilization.
• Sustainability Concerns: Need for balanced fertilization (e.g., combining urea with phosphates, potash, or nano-urea) to ensure long-term soil health.

2. iTrapper: Smart Light Trap to Target Pests & Save Beneficial Insects

Context:

Hyderabad-based Delta Things Pvt Ltd, in collaboration with PJTSAU, has developed iTrapper, an IoT-enabled intelligent light trap that selectively eliminates crop pests like pink bollworm while safeguarding beneficial insects.

Key Highlights:

• Core Technology:
  • Multiwavelength LED bulb
  • IoT microcontroller
  • Crop-specific light wavelength programming
• Working Principle:
  • Emits specific light wavelengths at targeted times to attract harmful pests
  • Automatically shuts down during periods when beneficial insects are active
  • Crop-specific settings (e.g., cotton → pink bollworm trap at sunset; paddy → gall midge trap post-midnight)

Benefits & Impact

• Eco-Friendly: Chemical-free pest control method
• Biodiversity Preservation: Does not kill beneficial insects
• Reduced Costs: Minimizes need for pesticide sprays
• Smart Features (Export Version):
  • Bluetooth & mobile app support
  • Cloud data integration
  • Onboard camera for hourly image capture
  • Predictive pest advisories based on AI and weather analysis

Why It Matters

• Sustainable Agriculture: Reduces ecological harm caused by indiscriminate pest traps
• Precision Farming: Promotes data-driven, crop-specific pest control
• Innovation in AgriTech: Indian start-ups leading with scalable, smart farming tools

BL

Facts To Remember

1. Mexico wins CONCACAF Gold Cup for record-extending 10th time

Mexico defeated USA 2-1 to retain the CONCACAF Gold Cup and lift the title for a record-extending 10th time. An Edson Alvarez header 13 minutes from time completed a come-from-behind victory for Mexico after a typically hard-fought tussle between the North American arch-rivals.

2. Securitisation volumes up 9% Q1 at ₹ 49K cr in

The sale of loans by banks and nonbanking financial companies (NBFCs) through securitisation grew 9 per cent on ayear-on-year (Y-o-Y) basis to ₹ 49,000 crore in the first quarter of2025-26 (Q1FY26), according to ratings agency Crisil.

3. Gujarat Becomes 3rd Indian State to Cross 1 Crore Stock Market Investors

This milestone was confirmed by the National Stock Exchange (NSE). Gujarat has become the third state in India to record over 1 crore registered stock market investors.

4. Bawana Waste-to-Energy Plant Gets Environmental Clearance Amid Protests

The Union Environment Ministry has granted environmental clearance (EC) to a proposed Waste-to-Energy Plant (WTE) in Bawana, making it the fifth such facility set to come up in Delhi.

4. ₹8,000 Crore Proposals Received Under Centre’s Electronics Components Manufacturing Scheme (ECMS)

The Ministry of Electronics and Information Technology (MeitY) has received proposals worth ₹7,500–8,000 crore from over 100 Indian and global firms under the newly launched Electronics Components Manufacturing Scheme (ECMS), aimed at strengthening India’s electronics supply chain and reducing import dependency.

Daily Current Affairs Quiz
9 July, 2025

National Affairs

1. Great Hornbill

Context:

In a rare ecological event, the Great Hornbill (Malamuzhakki Vezhambal)—Kerala’s State Bird and an endangered species—was recently sighted in Kakkampara near Ezhimala, a coastal region of Kannur district, far from its traditional forest habitats.

Conservation Status

• IUCN Red List: Listed as Endangered.
• Legal Protection: Covered under Schedule I of the Indian Wildlife (Protection) Act, ensuring maximum protection.
• Habitat Anomaly:
  • Typically found in the evergreen and moist deciduous forests of Kerala—Silent Valley, Nelliampathy, Aralam, Athirappilly, and Parambikulam.
  • The appearance in a coastal zone is highly unusual and ecologically significant.

2. Cabinet Approved Research Development and Innovation (RDI) Scheme

Context:

The Union Cabinet has cleared the Research Development and Innovation (RDI) Scheme with a corpus of ₹1 lakh crore, aiming to transform India’s research and innovation ecosystem, especially in sectors of economic and strategic importance.

Key Objectives of the RDI Scheme

• Promote private sector investment in R&D, particularly in strategic and economically critical sectors
• Support projects at higher Technology Readiness Levels (TRLs) for faster commercialization
• Facilitate technology acquisition where domestic capacity is lacking
• Establish a Deep-Tech Fund of Funds to nurture startups and frontier innovation

Institutional Framework

• Governing Board (under Anusandhan National Research Foundation, chaired by the PM): Strategic oversight
• Executive Council (ANRF): Identifies projects, finalizes fund managers
• Empowered Group of Secretaries (EGoS): Reviews and implements scheme, chaired by Cabinet Secretary
• Nodal Department: Department of Science and Technology (DST)

Funding Structure: Two-Tier Mechanism

• Corpus: ₹1 lakh crore via 50-year interest-free loan to ANRF
• Special Purpose Fund (SPF): Managed under ANRF; acts as central custodian of funds
• Second-Level Fund Managers:
  • Selected by ANRF
  • Disburse concessional long-term loans or equity to R&D/startup projects
  • Evaluate projects and offer funding through equity or debt

Why It’s Needed

• India’s GERD (Gross Expenditure on R&D) was ₹1.27 lakh crore in 2021 (only 0.64% of GDP)
• Economic Survey 2024–25 highlighted this as insufficient compared to global peers
• Private sector R&D spending remains significantly low due to financial and risk constraints

3. Nutritional Intake in India Report

Context:

The National Statistical Office (NSO) has published its latest report on India’s nutritional intake, derived from data collected in the Household Consumption Expenditure Surveys (HCES) for the periods August 2022–July 2023 and August 2023–July 2024.

Key Highlights:

• Average Calorie Intake (per capita per day):
  • Rural India: 2233 Kcal (2022–23) → 2212 Kcal (2023–24)
  • Urban India: 2250 Kcal → 2240 Kcal
• Average Protein Intake (per capita per day):
  • Rural: 61.9 gm → 61.8 gm
  • Urban: 63.2 gm → 63.4 gm
• Average Fat Intake (per capita per day):
  • Rural: 59.7 gm → 60.4 gm
  • Urban: 70.5 gm → 69.8 gm
• Calorie intake increases with Monthly Per Capita Consumption Expenditure (MPCE) across both rural and urban sectors.
• Inequality Reduced:
  • The gap in calorie intake between the bottom and top fractile classes narrowed in 2023–24.
• Main Sources of Protein (2023–24):
  • Cereals remain the largest source: ~47% in rural and ~39% in urban areas.
  • The share of cereals in protein intake has declined steadily since 2009–10, offset by increases in eggs, fish, meat, and milk products.
• Adjusted Nutrient Intake (Accounts for external meal consumption):
  • Adjusted values are slightly lower than unadjusted.
  • Adjusted Calorie Intake (2023–24):
    • Rural: 2191 Kcal
    • Urban: 2225 Kcal

PIB

4. FATF 2025 Report Flags Digital Tools as Key Enablers in Terror Financing

Context:

The Financial Action Task Force (FATF) released its 2025 comprehensive update on Terrorist Financing Risks, highlighting how emerging digital platforms are increasingly misused to fund terrorism. India features prominently in case studies involving digital tools in the Pulwama and Gorakhnath attacks.

Key Highlights from FATF 2025 Report:

• Digital Terror Financing Tools:
  • Use of e-commerce platforms, cryptocurrencies, VPNs, and third-party payment gateways to anonymously fund and execute terror operations.
  • Example: The Pulwama bomber procured aluminium powder via Amazon; the Gorakhnath attacker used PayPal and VPNs to finance ISIL-linked operations.
• Exploitation of E-Commerce Platforms (EPOMs):
  • Terrorists are using online marketplaces to purchase dual-use goods covertly.
  • Lack of monitoring and due diligence enables misuse.
• Crypto and Anonymous Tools:
  • Unregulated cryptocurrency markets, mixing services, and blockchain wallets aid in untraceable fundraising.
  • Encrypted apps and VPNs help avoid detection and surveillance.
• Lone-Actor Radicalisation:
  • Rise in self-radicalised individuals using crowdfunding, gaming platforms, and social media to mobilise funds and coordinate attacks independently.
• Trade-Based Terror Financing:
  • Use of under- and over-invoicing on digital storefronts to launder and transfer terror funds without raising red flags.
• Geographic Focus:
  • High-risk zones: India, South Asia, West Africa, Sahel, and Middle East.
  • India cited for both domestic radicalisation and cross-border financial threats.
• Regulatory Gaps Identified:
  • Weak KYC norms on digital wallets and fintech platforms.
  • Poor data localisation policies hinder law enforcement’s ability to retrieve digital evidence.

Challenges in Combating Digital Terror Financing:

• Cross-border legal complexity and lack of cooperation.
• Dark web usage and real-time tech adaptability by terror groups.
• Inadequate oversight in jurisdictions with lax AML/CTF frameworks.

FATF Recommendations:

• Strengthen Digital KYC: Mandatory identity verification for e-wallets, fintech apps, and e-commerce platforms.
• Real-Time AI Surveillance: Deploy systems to detect suspicious financial behavior and keyword-triggered purchases.
• Global Data Sharing: Establish treaties and digital evidence exchange protocols with tech-hosting nations.
• Crypto Oversight: Enforce disclosure, monitoring, and suspicious transaction reporting by crypto exchanges.
• Platform Responsibility: Online marketplaces to flag high-risk items, ensure seller verification, and comply with reporting standards.

TH

Banking/Finance

1. RBI Issues New Directions on Pre-Payment Charges for Loans

Context:

To enhance access to affordable credit for Micro and Small Enterprises (MSEs) and resolve customer grievances, the Reserve Bank of India (RBI) has issued the RBI (Pre-payment Charges on Loans) Directions, 2025, effective January 1, 2026.

Key Highlights:

Applicability

• Effective from: January 1, 2026
• Applies to:
  • Commercial banks (excluding Payments Banks)
  • Co-operative banks
  • NBFCs (including NBFC-UL, NBFC-ML)
  • All India Financial Institutions (AIFIs)

What is Pre-payment Charges?

Prepayment charges on loans, also known as prepayment penalties, are fees that lenders impose on borrowers who repay their loans before the scheduled end date. These charges compensate the lender for the interest income they would have earned had the loan been repaid according to the original terms. 

Pre-Payment Charges Provisions

No Pre-Payment Charges (Floating Rate Loans)

• For personal loans (non-business purposes):
  • No charges for individuals (with/without co-obligants)
• For business loans to individuals and MSEs:
  • No charges if lender is:
    • Commercial Bank (excluding SFBs, RRBs, LABs)
    • Tier-4 Primary (Urban) Co-operative Bank
    • NBFC-UL
    • AIFI
  • No charges up to ₹50 lakh if lender is:
    • Small Finance Bank (SFB)
    • Regional Rural Bank (RRB)
    • Tier-3 Urban Co-operative Bank
    • State & Central Co-operative Banks
    • NBFC-ML

Universal Application

• Applies regardless of the source of pre-payment (borrower’s own funds or loan refinance)
• No minimum lock-in period required

Dual/Special Rate Loans

• Applicability depends on whether the loan is floating at the time of pre-payment

Other Key Provisions

• Cash Credit/Overdraft:
  • No charge if borrower informs in advance of non-renewal and closes on due date
  • If pre-paid early, charges only on sanctioned limit
• Disclosure Mandate:
  • All charges must be clearly disclosed in the sanction letter, loan agreement, and Key Facts Statement (KFS)
• No Retrospective Charges:
  • REs cannot re-impose previously waived charges
• No Charges if Prepayment Initiated by RE
• Charges in Other Cases:
  • As per RE’s approved policy, but based on prepaid amount or sanctioned limit as applicable

RBI

2. SEBI Clampdown Leads to 20% Fall in Retail Participation in F&O Market

Context:

The Securities and Exchange Board of India (SEBI) has reported a sharp 20% decline in individual retail traders in the equity derivatives (Futures & Options) market, following its recent interventions aimed at curbing retail frenzy and mitigating financial risks.

Key Findings from SEBI’s Latest F&O Study

Retail Participation Drops Sharply

• Unique traders fell from 8.43 million to 6.77 million, a 20% decline.
• Turnover by individual traders dropped by 11%, from ₹62,700 crore to ₹56,000 crore.
• Sharpest decline (30%) was observed in traders with less than ₹10,000 turnover.

SEBI’s Regulatory Measures (Since November 2024)

• Raised contract size for weekly and monthly index derivatives.
• Limited weekly index derivative listings.
• Mandated upfront premium collection from options buyers.
• Abolished calendar spread benefit on expiry day.

These reforms were introduced in response to concerns about financial losses among retail participants and rising speculative trading.

BS

3. No Closure of Inactive PMJDY Accounts

Context:

The Department of Financial Services (DFS), Ministry of Finance has refuted media reports claiming that banks have been instructed to close inactive PM Jan Dhan Yojana (PMJDY) accounts.

Key Highlights:

• Clarification Issued: DFS has not asked any bank to close inactive PMJDY accounts.
• 3-Month Awareness Campaign:
  • Launched on July 1, 2025, across India.
  • Aimed at deepening outreach and awareness of:
    • PM Jan Dhan Yojana (PMJDY)
    • Pradhan Mantri Jeevan Jyoti Bima Yojana (PMJJBY)
    • Atal Pension Yojana (APY) and other financial inclusion schemes.
• Re-KYC Drive:
  • Banks will conduct re-KYC of all due accounts during this campaign.
• Monitoring of Inactive Accounts:
  • DFS regularly tracks inactive accounts and advises banks to reach out to account holders to help them activate their accounts.

Pradhan Mantri Jan Dhan Yojana (PMJDY)

• Launch Date:
  • August 28, 2014
• Ministry
  • Ministry of Finance

Objective:
To promote financial inclusion by providing affordable access to:

• Banking/savings accounts
• Remittance services
• Credit
• Insurance
• Pension

Eligibility Criteria

• Must be an Indian citizen
• Age: 18 to 59 years
• Minors above 10 years can open accounts with parental/guardian supervision

Account Features

• Can be opened at any bank branch or Bank Mitr (Business Correspondent) outlet
• Zero balance required to open the account
• Chequebook facility available only if minimum balance is maintained
• Comes with a RuPay debit card for cash withdrawals at ATMs

TH

4. SEBI May Scrap Weekly Index Options Expiry

Context:

SEBI may revise the weekly expiry schedule of index options to fortnightly, limiting it to one expiry per fortnight, if its recent reforms fail to reduce the speculative surge in options trading volumes. This comes in the backdrop of the Jane Street order for alleged manipulation and the regulator’s ongoing effort to cool down over-heated index derivatives markets.

Why the Move is Being Considered

• High index options turnover continues despite prior curbs.
• SEBI’s 3 July interim order against US-based Jane Street for ₹4,844 crore market manipulation on options expiry day raised concerns about market integrity.
• Retail traders dominate index options, but 91% incurred net losses in FY25, similar to FY24, per SEBI’s Equity Derivatives Study (EDS).

Recent Measures by SEBI

• October 2023:
  • Cut multiple weekly expiries to one per exchange.
  • Increased contract size to ₹15–20 lakh (from ₹5–10 lakh).
• May 2025:
  • Changed Open Interest (OI) computation to future-equivalent basis, reducing notional exposure leverage.
  • Tightened position limits to cap risk exposure.

SEBI’s Plan Going Forward

• Monitor whether recent reforms reduce speculative volumes in coming weeks.
• If impact is marginal, may move to a single fortnightly expiry per benchmark index (Sensex, Nifty).
• Final decision to be taken after stakeholder consultations.

Mint

5. ADB Launches UHC PEERS Network to Boost Universal Health Coverage

Context:

At the INSPIRE Health Systems Forum in Manila, the Asian Development Bank (ADB)—led by President Masato Kanda—launched the Universal Health Coverage Practitioners and Experts Knowledge Exchange and Resources (UHC PEERS) network. Health ministers and officials from over 25 countries participated in the event.

Why It’s Important

• Over 1 billion people in Asia and the Pacific lack access to essential health services.
• Many families fall into poverty due to out-of-pocket medical expenses.
• ADB estimates show that every $1 invested in primary healthcare yields $10 in economic returns, underlining the importance of public health investments.

Features of UHC PEERS Network

• Peer-to-peer learning platform for cross-country collaboration and best practices.
• Focus areas include:
  • Health financing reform
  • Primary healthcare innovations
  • Inclusion of underserved communities
  • Private sector engagement
• Complements the UHC Knowledge Hub in Tokyo.

Agriculture

1. CRISPR-Edited Rice Enhances Phosphorus Uptake and Yield: NIPGR

Context:

Researchers at the National Institute of Plant Genome Research (NIPGR), New Delhi, have used CRISPR-Cas9 gene-editing technology to improve phosphorus uptake and yield in japonica rice varieties. This development has the potential to reduce India’s reliance on phosphate fertilizers and enhance crop productivity, especially in phosphorus-deficient soils.

Why It Matters

• Phosphorus (P) is vital for plant growth but is often limited in Indian soils, affecting crop yield.
• Even with phosphate fertilizers, only 15–20% is absorbed by plants; the rest is lost due to leaching or runoff.
• India is highly import-dependent for phosphate fertilizers, raising sustainability concerns.

Key Scientific Advancement

Focus on Phosphate Transport

• Rice absorbs phosphate via root transporters and transfers it to shoots through another transporter, OsPHO1;2.
• Researchers targeted the regulation of OsPHO1;2 to improve phosphate translocation from root to shoot.

Identification and Editing Strategy

1. Repressor Gene Identified:
   • OsWRKY6 binds to the promoter of OsPHO1;2 and represses it.
   • Complete knockout of OsWRKY6 using CRISPR improved phosphate uptake but harmed plant development due to loss of other essential functions.
2. Precision Edit:
   • Scientists removed only the 30 base pair binding site on the promoter without removing the repressor itself.
   • This increased OsPHO1;2 expression in roots while preserving other repressor functions.

Results of the Experiment

• Higher Shoot Phosphate Accumulation.
• Increased Panicle and Seed Numbers.
• Yield Boost:
  • 20% increase in yield with recommended P dose.
  • 40% increase with only 10% of recommended P fertilizer.
• Seed Quality: Normal in size, starch, and phosphorus content.

Japonica Rice

Japonica rice, also known as sinica rice, is a variety of Oryza sativa (Asian rice) characterized by its short to medium, round, and sticky grains. It’s a major rice type cultivated and consumed in East Asia, particularly in Japan, Korea, and China, but also grown in other regions like Italy and parts of the United States. Unlike the longer, thinner grains of indica rice, Japonica rice is known for its stickier texture when cooked, making it suitable for dishes like sushi and rice bowls. 

TH

2. National Workshop on DBT Portal 2.0 & NaMo Drone Didi Yojana Held

Context:

The Ministry of Agriculture and Farmers’ Welfare (Mechanization & Technology Division) organized a one-day national workshop in New Delhi on the implementation of:

• Online Centralized Direct Benefit Transfer (DBT) Platform Version 2.0
• NaMo Drone Didi Yojana

Key Highlights:

Major Launches

• Crop-Specific Standard Operating Procedures (SOPs) for drone-based application of soil and plant nutrients were unveiled
• SOPs aim to standardize drone use in agriculture nationwide

NaMo Drone Didi Yojana

• Flagship women-centric scheme empowering Self-Help Group (SHG) members to use drones for:
  • Spraying fertilizers, pesticides, and other agro-chemicals
• New Drone Portal launched for:
  • Mapping and tracking drone operations
  • Pilot training and certification
  • Real-time dashboard for stakeholders

DBT Platform Version 2.0

• Live demonstrations conducted for Central & State officers
• Features:
  • Improved transparency and digital workflows
  • Faster subsidy disbursal under Sub-Mission on Agricultural Mechanization (SMAM)
  • End of manual bottlenecks and delays
• States shared feedback and implementation best practices

Significance

• Aimed at small and marginal farmers
• Pushes for digital reforms in agricultural mechanization
• Promotes women’s participation in agri-tech and drone operations
• Facilitates fair access to machinery subsidies and support systems

PIB

Facts To Remember

1. Bihar Cabinet makes domicile must for women’s job quota

The Bihar Cabinet on Tuesday made domicile mandatory for accessing the 35% reservation for women in State government jobs.

2. Bulgaria becomes 21st member to adopt euro after EU green light

EU Ministers gave the final green light for Bulgaria to adopt the euro on January 1, 2026, making it the single currency area’s 21st member. Bulgaria’s switch from the lev to the euro comes nearly 19 years after the country joined the European Union. EU finance ministers officially set the euro at 1.95583 Bulgarian lev. 

3. Public Sector Banks Prioritize Local Language Skills to Improve Customer Service

Amid growing concerns over language barriers in customer interactions, state-owned banks are stepping up efforts to bridge linguistic gaps by mandating local language proficiency for new hires and training existing employees in regional languages.

4. RBI to conduct two day VRRR auction today to soak up ₹ 1 trn

The Reserve Bank of India (RBI) will conduct a two-day variable rate reverse repo (VRRR) auction for a notified amount of ₹ 1 trillion.

5. BoI Waives Balance Penalty, Cuts Home and Edu Loan Rates

Bank of India has waived non-maintenance of minimum balance penalties across all savings bank account schemes, effective immediately.

6. NPCI Ups RuPay Card Play to Challenge Global Rivals Visa, Mastercard

The National Payments Corporation of India (NPCI) is aggressively incentivising banks to push RuPay credit cards, directly challenging global players Visa and Mastercard in India’s booming credit card market.

7. Mustard Oil Identified as Key to India’s Edible Oil Self-Reliance

Industry leaders and data from the 2024–25 crop year indicate that mustard, a vital Rabi oilseed crop, can play a central role in reducing India’s edible oil import dependency. Experts advocate for greater acreage, high-yield seed promotion, and assured price mechanisms.

8. Brazil confers its highest civilian honour ‘Grand Collar of the National Order of the Southern Cross’ on PM Modi

Prime Minister Narendra Modi’s four-day visit to Brazil, which enhanced and enriched South dialogue and deepened strategic ties with Brazil, has concluded. 

Daily Current Affairs Quiz
10 July, 2025

National Affairs

1. Starlink Receives IN-SPACe Approval to Operate in India

Context:

On July 9, 2025, IN-SPACe (Indian National Space Promotion and Authorisation Centre), under the Department of Space, granted authorisation to Starlink to operate its satellite broadband services in India. This marks a significant regulatory step for Elon Musk’s SpaceX-owned Starlink, which has long awaited full clearance to launch operations in the country.

IN-SPACe (Indian National Space Promotion and Authorisation Centre)

• IN-SPACe, the Indian National Space Promotion and Authorisation Centre, is an autonomous agency under the Department of Space (DoS) in India. 
• Its primary role is to facilitate and regulate the participation of non-governmental entities (NGEs) in the space sector, acting as a bridge between private players and ISRO. 

Importance of IN-SPACe Authorisation

• Allows Starlink to deploy its satellite constellation over Indian territory.
• Enables broadband coverage in remote and underserved areas lacking mobile infrastructure.
• A key step before commercial rollout of satellite internet services.

What Is Starlink?

• A low-Earth orbit (LEO) satellite network operated by SpaceX.
• Provides high-speed, low-latency internet globally, including in rural and remote locations.
• Particularly beneficial for geographies underserved by fiber or mobile networks.

TH

2. National Population Register (NPR)

Context:

The Government of India has initiated preparatory discussions for Census 2027, but no final decision has been taken yet on updating the National Population Register (NPR) during this exercise, according to senior Home Ministry officials.

What is NPR?

The National Population Register (NPR) is a comprehensive database of “usual residents” of India. A usual resident is defined as someone who has stayed in a local area for at least 6 months or intends to stay for the next 6 months. It includes both Indian citizens and foreign nationals.

Background and Legal Framework

• Introduced under: Citizenship Act, 1955
• Rules: Citizenship (Registration of Citizens and Issue of National Identity Cards) Rules, 2003
• Nodal Agency: Registrar General and Census Commissioner, Ministry of Home Affairs
• First Collected: In 2010, updated in 2015 through a door-to-door survey.

Features and Process

• Mandatory: Registration is legally compulsory for all usual residents.
• Enumeration Method: House-to-house survey during the census’s house-listing phase.
• Inclusivity: Covers citizens and non-citizens residing in India.
• Levels of Compilation: Local (village/town) → Sub-district → District → State → National.
• Possible Outcome: Issue of a National Identity Card based on NPR data.
• Authority: Registrar General acts as National Registration Authority.

3. Petroleum & Natural Gas Rules, 2025

Context:

The Ministry of Petroleum & Natural Gas has released a draft policy framework to modernise India’s upstream oil and gas sector. The draft rules aim to replace outdated regulations and align with evolving energy, environmental, and investment needs.

Key Features:

• Stabilisation Clause:
  • License holders will be protected from future increases in taxes or royalties. They can claim compensation or deductions in case of policy changes affecting their financial terms.
• Third-Party Access Mandate:
  • Lessees must declare any underutilised capacity in pipelines and facilities. Fair and transparent access will be ensured under government oversight.
• Green Energy Integration:
  • The rules permit solar, wind, hydrogen, and geothermal projects within existing oilfields. This supports India’s net-zero targets and promotes hybrid energy use.
• Environmental Safeguards:
  • Greenhouse gas (GHG) monitoring, site restoration, and carbon capture and storage (CCS) are made mandatory. Post-closure monitoring will continue for five years.
• Data Ownership and Access:
  • All operational data generated under these rules will be owned by the Government of India. External use will require prior approval, and confidentiality will be maintained for up to seven years.
• Dispute Resolution Framework:
  • A dedicated Adjudicating Authority at the rank of Joint Secretary will handle disputes, ensure compliance, and levy penalties where necessary.
• Contractual Reforms:
  • New model contracts will allow for unitisation (joint development of shared reservoirs), lease mergers, and easier relinquishment of non-viable blocks.
• Legal Modernisation:
  • The new rules will replace the Petroleum Concession Rules (1949) and Petroleum & Natural Gas Rules (1959), aligning them with the amended Oilfields Act, 1948.

Implications

• These reforms could boost private investment by reducing regulatory risks and transaction costs.
• They align fossil fuel operations with India’s climate goals, particularly through CCS and renewable integration.
• The rules enhance transparency via stronger data governance and independent adjudication.
• Operational flexibility through shared infrastructure and contractual ease could unlock more efficient resource use.

Banking/Finance

1. SEBI Proposes Expanded Role for Credit Rating Agencies

Context:

The Securities and Exchange Board of India (SEBI) has released a consultation paper proposing to expand the permitted activities of Credit Rating Agencies (CRAs) beyond securities listed or proposed to be listed on stock exchanges. The draft is open for public comments until 30 July 2025.

Credit Rating Agencies (CRAs)

Credit Rating Agencies (CRAs) are organizations that assess the creditworthiness of borrowers, like companies or governments, and assign ratings to their debt instruments. These ratings reflect the agency’s opinion on the likelihood that the borrower will repay its debts, including principal and interest, on time. Investors use these ratings to gauge the risk associated with investing in those debt instruments. 

Current Regulatory Gap

• SEBI regulations currently restrict CRAs to rating listed or to-be-listed securities.
• CRAs can rate financial instruments under other financial sector regulators (FSRs) like RBI or IRDAI only if those regulators have issued relevant guidelines.
• A lack of such guidelines from some FSRs has led to ambiguity over CRA roles in rating unlisted financial instruments.

Key Proposals in the Consultation Paper

Current Norms:

• CRAs are currently allowed to rate only those securities that are:
  • Listed or proposed to be listed on SEBI-recognised stock exchanges.
  • Governed under SEBI regulations.

SEBI’s Key Proposal:

• CRAs may be allowed to rate financial instruments regulated by other FSRs (e.g., RBI, IRDAI, PFRDA) even if:
  • The respective regulator has not issued detailed CRA guidelines.
  • The instrument is not listed or proposed to be listed on an exchange.

Conditions:

• Ratings must be:
  • Fee-based: The CRA receives a professional fee.
  • Non-fund-based: No financing or credit exposure involved.

TH & Mint

2. Catastrophe Bonds (Cat Bonds)

Context:

India faces increasing exposure to climate-induced disasters such as floods, cyclones, forest fires, and earthquakes. Despite this, disaster risk insurance penetration is low, leaving much of India’s population and property uninsured and financially vulnerable. In this context, catastrophe bonds (cat bonds) offer an innovative risk-transfer mechanism that India could adopt.

What are Catastrophe Bonds (Cat Bonds)?

Cat Bonds are specialized financial instruments that combine insurance and debt features, used to transfer disaster-related risks (like earthquakes, cyclones) from governments or insurers to capital market investors.

Key Features

• Hybrid Instrument: Insurance-cum-debt product that securitizes catastrophe risk.
• Risk Transfer: Moves risk from sponsor (like a sovereign government) to global investors.
• Tradability: Makes hazard insurance cover a tradable security.
• Trigger-Based Payouts: Provides pre-defined, quick payouts post-disaster.

How Cat Bonds Work

Element	Description
Sponsor	Sovereign nations or insurers who issue cat bonds to transfer risk.
Premium	Paid by the sponsor; the principal equals the insured amount.
Intermediary	Institutions like the World Bank, ADB, or reinsurance firms to issue and manage risk.
Investors	Pension funds, hedge funds, and family offices who take on risk in return for higher coupon rates.
Coupon Rates	Higher than standard bonds due to risk; varies by hazard (e.g., 1–2% for earthquakes, higher for hurricanes).
Loss of Principal	Investors may lose part of the principal if a catastrophe occurs.

Benefits of Cat Bonds

• For governments: Access to fast, reliable disaster relief funding.
• For investors: Portfolio diversification and non-correlated, higher-yield investment.
• For global markets: Larger pool of capital available for disaster risk management.

Why India Needs Cat Bonds

• Rising Climate Risk
  • India ranks high on hazard exposure, with increasing frequency and intensity of disasters.
  • Traditional insurance markets may fail to price or cover such risks affordably.
• Low Penetration of Disaster Insurance:
  • Unlike life insurance, most Indian assets and livelihoods remain uninsured against disasters.
• Public Finance Risk:
  • Without financial buffers, governments are forced into fiscal distress post-disaster.
• Regional Opportunity:
  • India could sponsor a South Asian cat bond covering multi-country events (e.g., cyclones, tsunamis, earthquakes).

TH

3. RBI’s Whitelist and Key Safety Guidelines

Context:

The Reserve Bank of India (RBI) has published a list of authorised digital lending apps (DLAs) on its website to help borrowers distinguish between regulated and fraudulent apps. This move is part of its ongoing effort to safeguard digital lending in India and ensure consumer protection.

Why This Matters

• RBI-registered DLAs follow regulatory norms like:
  • Digital Lending Directions
  • Fair Practice Code
  • Mandatory disclosures (KFS, loan agreements, etc.)
  • Fraudulent loan apps often operate without regulation, exploit users, and use coercive or abusive tactics during loan recovery.

Risks of Using Unauthorised Loan Apps

• Hidden Charges & High Interest: Exorbitant interest (10–20% per month) and steep penalties.
• No Transparency: Lack of proper disclosures and loan documents.
• Data Exploitation:
  • Access to contact lists, photo galleries
  • Social shaming by messaging family and friends
  • Misuse or morphing of private photos
  • Abusive Recovery Practices: Harassment by recovery agents.

BS

4. RBI Issues Draft Guidelines on Novation of OTC Derivative Contracts

Context:

On July 10, 2025, the Reserve Bank of India (RBI) released draft guidelines proposing a structured mechanism for novation of over-the-counter (OTC) derivative contracts. This move aims to enhance transparency, fairness, and legal certainty in OTC derivatives markets.

What is Novation?

Novation is a legal process that replaces an existing contract with a new one by substituting one counterparty while maintaining identical contractual terms (except the party change).

• Parties Involved in Novation:
  • Transferor: Original party who exits the contract.
  • Transferee: New party entering the contract.
  • Remaining Party: The party that remains unchanged and continues in the new contract.

Key Features of the RBI Draft Guidelines

1. Consent Requirement
   • Novation can occur only with the explicit consent of the remaining party.
2. Tripartite Agreement
   • A formal tripartite agreement among the transferor, transferee, and remaining party is necessary.
3. Fair Valuation and Market Rates
   • Novation must occur at prevailing market rates.
   • The mark-to-market value must be exchanged between transferor and transferee to reflect financial fairness.
4. Standardised Documentation
   • RBI has asked FIMMDA (Fixed Income Money Market and Derivatives Association of India) and FEDAI (Foreign Exchange Dealers’ Association of India) to:
     • Develop standard documentation based on international best practices.
   • Alternatively, participants can use a standard master agreement.
5. Regulatory Reporting
   • All novated transactions must be reported to the Trade Repository of CCIL (Clearing Corporation of India Ltd) in compliance with existing norms.

TET

5. Non-Performing Assets (NPAs) in India

Context:

India’s large stockpile of Non-Performing Assets (NPAs) is often seen as a reflection of inefficiency in the banking sector. However, it also presents a significant investment opportunity due to the steep discounts offered in bank-led property auctions—often 20–30% below market value. Despite this, real estate investors have largely stayed away from this sector due to multiple structural and regulatory challenges.

What are NPAs?

NPAs are loans or advances where the borrower has stopped making interest or principal repayments for a specified period, typically 90 days. When a loan turns into an NPA, it is classified into different categories based on its aging and recoverability. Banks are required to maintain provisions for such assets, which can affect their overall profitability and lending capacity.

Classification of NPAs

Banks classify NPAs into different categories based on the time elapsed since the due date:

• Substandard Assets:
  • Loans that remain non-performing for up to 12 months. These assets carry a higher risk, but there is still a reasonable expectation of recovery.
• Doubtful Assets:
  • Loans that have remained substandard for more than 12 months. The probability of recovery becomes significantly lower, and banks need to provide a higher provision for these assets.
• Loss Assets: 
  • Loans where the bank or auditors have determined that the recovery is unlikely, though they may not be fully written off from the bank’s books. These assets represent a complete erosion of the bank’s capital if not handled properly.

SARFAESI & IBC

• SARFAESI Act (2002):
  • Enables lenders to seize and auction secured assets without court intervention after a 60-day notice.
• Insolvency and Bankruptcy Code (IBC, 2016):
  • Introduced a time-bound resolution process for corporate defaults.
  • Increased transparency and reduced timelines for recovery.

Challenges remain

• Delays due to institutional bottlenecks and lack of digital integration.
• Inconsistent implementation at the state/local level.

Technology-Driven Solutions

• AuctionBazaar, a digital platform, is addressing key inefficiencies by:
  • Providing searchable property listings.
  • Offering legal due diligence, valuation support, and e-auction facilitation.
  • Handling post-auction compliance and documentation.

BS

6. CAMS Launches CAMSPay Gateway for Secure Digital Transactions

Context:

Computer Age Management Services (CAMS), a key fintech infrastructure provider in India, has launched a new CAMSPay Payment Gateway tailored to meet the evolving regulatory and technological needs of the digital payments landscape.

Key Highlights:

• Launch Objective:
  • CAMSPay aims to deliver compliance, scalability, and high-performance digital transaction processing in alignment with RBI’s mandates.
• Regulatory Compliance:
  • Designed to meet RBI’s tokenisation and data localisation norms.
  • Fully certified by Mastercard, VISA, and Rupay for payment security and compliance.
• Performance Capabilities:
  • Can process 5,000+ transactions per second (TPS).
  • Offers real-time analytics, dashboards, and robust reliability.
• Strategic Partners:
  • Built with Mylapay as the technology partner.
  • Supported by RBL Bank as the BIN (Bank Identification Number) sponsor.
• Current Sector Usage:
  • Already serving entities in BFSI, NBFCs, fintech, and education.
  • Expansion plans include capital markets, insurance, and brokerages.

Economy

1. India’s Gini Index of 25.5

Context:

A recent World Bank Poverty and Equity Brief pegged India’s Gini index at 25.5 for 2022–23, making it appear among the most equal countries globally. However, the figure—based on consumption inequality, not income or wealth—has raised eyebrows among economists and policymakers alike.

Understanding the Gini Coefficient

• Gini Index: A measure of inequality within a population; 0 represents perfect equality, 100 indicates maximum inequality.
• India’s 25.5 figure is based on consumption expenditure, which generally underestimates inequality compared to income or wealth-based metrics.

Data Highlights

• Gini Index (Consumption):
  • Improved from 28.8 in 2011–12 to 25.5 in 2022–23.
• Extreme Poverty:
  • Fell from 16.2% to 2.3% over the same period.
• However, data suffers from:
  • Underreporting by the rich.
  • High non-response rates among affluent urban households.
  • Structural underestimation of inequality.

Why the Debate Matters

Wage Inequality

• In 2023–24, the top 10% of earners made 13 times more than the bottom 10%.
• Large segments of the workforce remain in informal, low-paying jobs (e.g., self-employment, casual labour).

Regional & Spatial Inequality

• Rural vs Urban MPCE Gap: Still 70% in 2023–24.
• Interstate Disparities:
  • Rural Tamil Nadu MPCE is nearly double that of Jharkhand.
  • Urban Telangana MPCE is 70% higher than in Bihar.
• These gaps reveal deep developmental imbalances.

Wealth and Intergenerational Inequality

• Wealth inequality and intergenerational transfers are excluded from consumption surveys.
• These factors significantly skew the real distribution of economic power.

BS

Agriculture

1. Indian Astronaut Shubhanshu Shukla Conducts Agri-Biotech Experiments on ISS

Context:

Indian astronaut Shubhanshu Shukla, during the final leg of his mission aboard the International Space Station (ISS), participated in several cutting-edge biological and agricultural experiments under India’s collaborative space science programme with Axiom Space and ISRO.

Key Scientific Experiments Conducted:

Space Germination of Indian Crop Seeds

• Seeds Used: Green gram (moong) and fenugreek (methi)
• Objective: Study the impact of microgravity on seed germination and early plant development.
• Method: Seeds sprouted in petri dishes, photographed, and stored in a space freezer for return to Earth.
• Post-Mission Plan:
  Seeds to be cultivated over multiple generations to observe:
  • Genetic adaptations
  • Microbial ecosystem shifts
  • Changes in nutritional profiles

Microalgae Deployment

• Studied for their ability to produce food, oxygen, and biofuels.
• Valuable for long-duration space missions due to their:
  • High adaptability
  • Efficient oxygen generation
  • Sustainability in closed-loop ecosystems

Space Crop Breeding

• Six plant varieties grown with the aim to:
  • Identify desirable genetic traits
  • Enable sustainable space farming through genetic analysis

Stem Cell Research

• Focus on testing if microgravity and supplements can:
  • Accelerate cell repair or recovery
  • Improve stem cell-based injury healing or tissue growth

Significance of the Research

• Pioneers astro-agriculture and space biomedicine using indigenous Indian crops.
• Lays foundation for space-based life support systems, crucial for future Mars or lunar missions.
• Enhances India’s contribution to global space biology research.

TH

2. National Fish Farmers Day 2025

Context:

National Fish Farmers Day 2025 was celebrated on 10th July to acknowledge the vital contribution of India’s fish farmers in ensuring food security, enhancing employment, and promoting sustainable aquaculture as part of the country’s growing Blue Economy.

Key Highlights:

Key Announcements

• Launch of new Fisheries Clusters.
• Release of ICAR Training Calendar.
• Launch of seed certification and hatchery operations guidelines.
• Virtual foundation stone laying and inauguration of PMMSY-supported projects.

Govt. Schemes

•  Pradhan Mantri Matsya Sampada Yojana (PMMSY)
  • The Pradhan Mantri Matsya Sampada Yojana (PMMSY) is a flagship scheme launched by the Indian government to promote the sustainable and responsible development of the fisheries sector.
    • Launch Date: 2020
    • Ministry: Ministry of Fisheries, Animal Husbandry and Dairying. 

PIB

Facts To Remember

1. Equity Mutual Fund Inflows Rise 24% in June 2025

As per the Association of Mutual Funds in India (AMFI), net inflows into equity mutual funds surged by 24% in June 2025, reaching ₹23,587 crore, up from ₹19,213 crore in May. This marks a rebound after the 22% dip in net equity inflows seen in May — the lowest in nearly a year.

2. Silver in 94kg for Parv in Asian junior weightlifting

Parv Chaudhary has claimed a silver medal in the men’s 94kg category at the Asian junior weightlifting championships in Astana. 

3. Wrestlers Varun and Rohit make do with silver

Indian Greco Roman wrestlers, Varun (63kg) and Rohit (87kg), landed silver medals at the Asian under-20 championships in Bishkek, Kyrgyzstan.

4. AIFs Seek Higher Investment Limits for Banks, NBFCs in RBI Draft Norms

Alternative Investment Funds (AIFs), through industry body Indian Venture and Alternate Capital Association (IVCA), have urged the Reserve Bank of India (RBI) to ease the investment limits proposed for Regulated Entities (REs) like banks and NBFCs under the draft circular dated May 19, 2025.

5. India’s Maize Productivity: Regional Successes & National Challenges

According to a FICCI–Yes Bank report based on the Ministry of Agriculture’s third advance estimates (2024–25 crop year), India’s average maize yield is 3.5 tonnes/hectare, significantly lower than the global average of 6 tonnes/hectare. However, select Indian states are outperforming global leaders like China, Brazil, and Russia.

6. Sahil Kini Appointed CEO of Reserve Bank Innovation Hub

Sahil Kini, a well-known name in the Indian fintech space, has been appointed as the new CEO of the Reserve Bank Innovation Hub (RBIH).

7. DELIVERY OF FIRST INDIGENOUS DIVING SUPPORT VESSEL – ‘NISTAR’

Nistar’, the first indigenously designed and constructed Diving Support Vessel, was delivered by Hindustan Shipyard Limited to the Indian Navy at Visakhapatnam. The warship has been designed and built as per classification rules of the Indian Register of Shipping (IRS). The ship is highly specialised and can undertake Deep Sea Diving and Rescue Operations – a capability with select Navies across the globe.

8. Namibia to launch a UPI-based digital payment system later in 2025.

This follows an agreement between the National Payments Corporation of India (NPCI) and the Bank of Namibia signed in April 2024. Namibia becomes one of the few African countries adopting India’s digital public infrastructure model.

Daily Current Affairs Quiz
11 July, 2025

National Affairs

1. TALASH Initiative

Context:

The Ministry of Tribal Affairs, in collaboration with UNICEF India, has launched TALASH (Tribal Aptitude, Life Skills, and Self-Esteem Hub) — a first-of-its-kind national platform designed exclusively for tribal students enrolled in Eklavya Model Residential Schools (EMRSs).

Key Highlights of TALASH Initiative

What is TALASH?

• Full form: Tribal Aptitude, Life Skills, and Self-Esteem Hub
• An innovative digital platform to help EMRS students with psychometric assessment, career counselling, and life-skills training.

Launched By:

• National Education Society for Tribal Students (NESTS)
• In collaboration with: UNICEF India
• Nodal Ministry: Ministry of Tribal Affairs, Government of India

Objectives of TALASH

• Foster self-awareness and personality development among tribal students.
• Enable aptitude-based career decision-making through psychometric assessments.
• Equip students with life skills such as communication, emotional intelligence, and decision-making.
• Train teachers as student mentors and life skill facilitators.

Core Features of TALASH

• Psychometric Testing
  • Based on NCERT’s Tamanna model.
  • Generates individual Career Cards aligned to students’ aptitudes and aspirations.
• Career Counselling Modules
  • Offers detailed information on career options best suited to student profiles.
  • Promotes informed, interest-aligned career planning.
• Life Skills & Self-Esteem Modules
  • Covers emotional resilience, conflict resolution, and self-confidence.
  • Encourages value-based growth and socio-emotional development.
• Teacher Training Portal
  • 189 EMRS teachers across 75 schools already trained.
  • Supports peer-led mentoring and capacity-building across tribal regions.
• Phased National Rollout
  • Targets 1.38 lakh+ tribal students across 28 States and 8 UTs.
  • Full coverage expected by end of 2025.
  • Initiated through city-level pilots for seamless adoption.

Significance of TALASH

• Empowers tribal youth through personalised digital learning.
• Bridges the aspirational, emotional, and academic divide in tribal education.
• Supports the NEP 2020 vision of holistic, inclusive, and skill-oriented education.
• Reaches remote tribal areas through tech-enabled innovation.

2. Aadi KARMAYOGI Mission Launched

Context:

In a historic stride towards Viksit Bharat @2047, the Ministry of Tribal Affairs has launched the first Regional Process Lab (RPL) of the Aadi KARMAYOGI – National Mission for Responsive Governance in Bengaluru, Karnataka. This flagship initiative aims to build a cadre of 20 lakh tribal grassroots functionaries, empowering them as agents of inclusive, last-mile governance in tribal areas across India.

What is Aadi KARMAYOGI?

Aadi KARMAYOGI stands for “Tribal Responsive Governance”, a bottom-up reform mission aligned with national goals such as PM-JANMAN, DAJGUA, and Mission Karmayogi. The programme is a whole-of-nation initiative rooted in tribal wisdom, empathy, and convergence.

Key Objectives:

• Build a dynamic cadre of tribal changemakers and governance facilitators.
• Bridge the last-mile service delivery gap through localized, participatory governance.
• Align tribal aspirations with responsive and accountable institutions.
• Foster convergence between ministries, civil society, and communities.

PIB

Banking/Finance

1. Finance Ministry Seeks Control Over National Health Claims Exchange (NHCX)

Context:

To enhance transparency, curb inflated medical bills, and streamline insurance claims, the Department of Financial Services (DFS) under the Finance Ministry has initiated a move to gain control over the National Health Claims Exchange (NHCX)—currently managed by the Health Ministry.

Key Highlights:

What is NHCX?

• A digital platform that connects:
  • Insurance companies
  • Healthcare service providers
  • TPAs (Third Party Administrators)
  • Government insurance schemes
• Aim: To automate and streamline health insurance claims and settlement.

Why the Finance Ministry Wants Control:

• DFS is in talks with the Prime Minister’s Office (PMO) to bring NHCX under the regulation of IRDAI (Insurance Regulatory and Development Authority of India).
• The goal is to ensure:
  • Greater transparency
  • Robust regulatory oversight
  • Fair pricing and billing practices
  • Balanced bargaining power between hospitals and insurers

Policy & Regulatory Implications:

• Bringing NHCX under IRDAI would:
  • Align digital claims infrastructure with insurance regulations
  • Improve monitoring of claim trends and billing anomalies
  • Promote fair treatment of policyholders
• Helps tackle complaints about inflated hospital bills during claim settlements

BS

2. Growing Retail Digital Payments: The Value of Interoperability: IMF

Context:

According to the International Monetary Fund (IMF), India now processes faster digital payments than any other country, largely driven by the widespread adoption of the Unified Payments Interface (UPI).

Key Highlights:

IMF Report Findings:

• Report Title: “Growing Retail Digital Payments: The Value of Interoperability” (Fintech Note)
• UPI is cited as the world’s most rapidly adopted real-time payment platform.
• India’s retail digital payments ecosystem is now more efficient, interoperable, and instantaneous than its global peers.

UPI’s Growth Trajectory:

• Launched: 2016 by NPCI (National Payments Corporation of India)
• Current Volume: Over 18 billion transactions per month
• UPI now dominates India’s electronic retail payments, outpacing debit and credit card usage.

Decline in Cash Usage:

• The report notes a decline in proxies for cash use, such as ATM withdrawals and cash-based transactions.
• Suggests a structural shift toward digital-first financial behaviour in India.

What Makes UPI Stand Out?

• Interoperability: Works across banks, platforms, and apps (e.g., PhonePe, Google Pay, Paytm)
• Zero cost to users: No fees for peer-to-peer transfers
• Accessibility: Available 24×7, even for small-value payments
• Inclusivity: Used by individuals, kirana stores, MSMEs, and urban consumers alike

Global Significance:

• The IMF acknowledges India’s payment system leadership.
• UPI is now being replicated or partnered with by other countries (e.g., Singapore’s PayNow integration, France’s QR code trial).

BS

3. Financial Markets Need More Clarity on RBI’s Liquidity Management

Context:

India’s banking system has witnessed a sharp turnaround in liquidity—from a deficit of ₹2 trillion at end-2024 to a surplus exceeding ₹3–4 trillion daily in mid-2025. This shift poses both opportunities and risks, prompting a call for greater transparency and active liquidity management by the RBI.

Key Developments

From Deficit to Surplus

• 2024-end: Liquidity deficit (~₹2 trillion) due to RBI’s currency market intervention to support the rupee.
• Mid-2025: Liquidity surplus (~₹3–4 trillion daily) due to:
  • Reduced forex market pressure
  • Favourable inflation outlook
  • RBI injecting ₹9.5 trillion durable liquidity since Jan 2025
  • CRR cut of 100 bps (in four tranches) expected to release ₹2.5 trillion

Implications of Excess Liquidity

Positive Effects	Potential Risks
Easier credit transmission	Inflationary pressures, particularly in asset prices
Lower borrowing costs	Depressed savings rates, prompting shift to riskier assets
Boost to investment and consumption	Misallocation of credit to unqualified borrowers
Temporary support to government borrowing	Erosion of bank margins due to cheaper corporate bond financing

Emerging Trends

• Deposit Rate Cuts: Banks, flush with funds, are reducing savings deposit rates.
• Cheap Loans: Reports indicate loans as low as 6.1% interest, barely above the cost of funds.
• Capital Market Preference: Corporates are shifting to capital markets, with:
  • ₹10 trillion corporate bond issuance in FY25
  • 60% of fresh capital raised through debt
• Compressed Bank Margins: Capital market competition limits banks’ pricing power.

Monetary Policy Challenges

• Weighted Average Call Rate (WACR) is below the policy repo rate, indicating excess liquidity.
• RBI is using Variable Rate Reverse Repo (VRRR) auctions to absorb funds but may need stronger tools.
• Lack of explicit communication on liquidity targets causes uncertainty among market participants.

Recommendations for the RBI

1. Communicate desired liquidity band: Clarity on target surplus levels can anchor market expectations.
2. Enhance VRRR operations: Scale and frequency may need adjustment.
3. Monitor credit quality closely: Ensure easy liquidity doesn’t fuel bad lending.
4. Coordinate with fiscal authorities: To avoid excess overlap of CRR-induced liquidity and government borrowing plans.

BS

4. SBI Mutual Fund Enters Specialised Investment Fund (SIF) Space Under Magnum Brand

Context:

SBI Mutual Fund (SBI MF), India’s largest asset manager, has officially entered the Specialised Investment Fund (SIF) space under its well-recognised Magnum brand. This marks a significant diversification of its offerings to cater to more sophisticated and market-aware investors.

Key Highlights

• Brand Identity: SBI MF has revived the Magnum branding to position its SIF products, leveraging the strong recall from previous schemes under the same name.
• Product Focus: SBI MF will initially explore equity and hybrid strategies under the SIF framework.
• Distribution Strategy: Wealth counters of banks, national distributors, and individual financial advisors will be primary channels for SIF distribution.

What Are SIFs?

Specialised Investment Funds (SIFs) are a new category of investment vehicles under the mutual fund regulatory framework that:

• Allow greater investment strategy flexibility (including long-short strategies).
• Cater to experienced and risk-aware investors.
• Require a minimum investment of ₹10 lakh.
• Can operate across equity, hybrid, and debt segments.

Permitted SIF Categories (as per SEBI norms):

1. Equity
   • Equity Long-Short
   • Equity ex-Top 100 Long-Short
   • Sector Rotation Long-Short
2. Hybrid
   • Active Asset Allocator Long-Short
   • Hybrid Long-Short
3. Debt
   • Debt Long-Short
   • Sector Long-Short

Strategic Significance

• SBI MF plans to leverage its large in-house talent pool for SIF management, similar to other AMCs.
• This move indicates growing demand for advanced investment solutions beyond traditional MF structures.
• SIFs aim to capture HNI and ultra-HNI interest in sophisticated, market-linked strategies, particularly amid increasing retail investor maturity post-2020.

BS

5. Sanjiv Bhasin Moves SAT Against SEBI Ban in Market Manipulation Case

Context:

Sanjiv Bhasin, former Director at IIFL Securities and a well-known market commentator, has filed an appeal with the Securities Appellate Tribunal (SAT) challenging a SEBI order dated 17 June 2025, which barred him from securities trading for alleged market manipulation and front-running.

SEBI Allegations

• Nature of Allegations: SEBI alleged that Bhasin and 11 others:
  • Engaged in coordinated fraudulent trading.
  • Placed trades prior to making stock recommendations on TV and social media.
  • Benefited from unlawful gains by influencing prices.
• Charges Included: Front-running and manipulation under PFUTP (Prohibition of Fraudulent and Unfair Trade Practices) Regulations.
• Actions Taken by SEBI:
  • Restraining Bhasin and others from accessing the securities market.
  • Freezing of bank and demat accounts.
  • Accused of trades executed before or simultaneously with public recommendations.

What is Front-Running?

Front-running refers to trading a stock based on prior knowledge of a large upcoming order likely to influence its price — an illegal practice under securities laws.

Securities Appellate Tribunal (SAT)

The Securities Appellate Tribunal (SAT) is a statutory body in India established to hear appeals against orders passed by the Securities and Exchange Board of India (SEBI), the Pension Fund Regulatory and Development Authority (PFRDA), and the Insurance Regulatory and Development Authority of India (IRDAI). It acts as a specialized quasi-judicial body to ensure fairness and transparency in the securities market. 

Mint

Agriculture

1. Seven New Products Added to e-NAM Platform

Context:

Union Agriculture Minister Shivraj Singh Chouhan has announced the inclusion of seven new agricultural commodities on the e-NAM (National Agriculture Market) platform. This move is aimed at enhancing price realization, improving market access, and strengthening farmer welfare.

New Commodities Added to e-NAM

The following seven region-specific commodities have been added:

• Sugarcane
• Marcha rice
• Katarni rice
• Jardalu mango
• Shahi litchi
• Magahi paan
• Banarasi paan

With these additions, the total number of products listed on the e-NAM portal has risen to 238.

About e-NAM Platform

• Launched: 2016
• Nodal Agency: Small Farmers’ Agri-Business Consortium (SFAC)
• Purpose: Unify and digitize India’s agri-markets for improved transparency, efficiency, and farmer incomes.
• Features:
  • Online bidding and auction
  • Real-time price discovery
  • Immediate payment settlements
  • Quality-based transparent trade

TET

2. Google Launches AI Tools to Boost Indian Agriculture and Linguistic Inclusion

Context:

On July 11, 2025, Google announced a series of open-source AI innovations and research partnerships designed to address India’s key challenges in agriculture and multilingual AI inclusivity. The announcement was made at a roundtable hosted at Google’s Bengaluru office, Ananta.

Key Highlights:

AMED API for Agriculture Monitoring:

• Google introduced the Agricultural Monitoring and Event Detection (AMED) API, a tool to track crop status and field activity across India.
• Built on the Agricultural Landscape Understanding framework.
• Enables real-time, granular data for supporting climate-resilient farming and boosting productivity.

Collaboration with IIT-Kharagpur on Cultural Inclusion:

• Under the Amplify Initiative, Google DeepMind is partnering with IIT-Kharagpur to build hyperlocal datasets representing India’s linguistic and cultural diversity.
• Aims to ensure Large Language Models (LLMs) are deeply contextualised, culturally aware, and relevant to India’s plurality.

Foundational and Applied AI Research:

• Google DeepMind emphasized a dual focus:
  • Advancing foundational AI (e.g., Gemini models)
  • Solving real-world, high-impact problems, such as climate risk, sustainable agriculture, and AI fairness.

Significance:

• For Agriculture: AI-driven, open-source platforms like AMED could transform precision farming, aid in climate adaptation, and support policy planning.
• For AI Localization: Amplify Initiative ensures future LLMs reflect India’s complex sociolinguistic reality, promoting inclusivity and fairness in tech.

TET

Facts To Remember

1. Centre identifies domestic firm for S-400 air defence system maintenance, repair, overhaul

The Ministry of Defence has identified an Indian firm to establish a maintenance repair and overhaul (MRO) facility for the S-400 air defence system in the country.

2. Maharashtra Assembly passes public security Bill; law won’t be misused: CM

The Maharashtra Assembly on Thursday passed the Maharashtra Special Public Security Bill, 2024, aimed at preventing “unlawful activities of Left Wing Extremist organisations or similar groups”. The Bill will now be tabled in the Legislative Council.

3. India to host shooting World Cup and junior World Championship

India has been given a World Cup to host in 2027 and the World Junior Championship in 2028, by the International Shooting Sport Federation (ISSF), as announced by the National Rifle Association of India (NRAI)

4. EY launches initiative for GenAI upskilling

EY has launched AI Academy, an initiative to support enterprises in upskilling their talent in the fields of artificial intelligence (AI) and generative AI (GenAI).

5. Ireda gets tax exemption for its bonds; move may attract more investments

State-owned Ireda said bonds issued by the company will be exempt from tax, a development that is expected to attract more investments for renewable energy projects.

6. Musk launches Grok 4 after antisemitism controversy

Elon Musks artificial intelligence startup xAI is rolling out Grok 4 just months after releasing its previous iteration, underscoring the frenetic pace of AI development.

7. India’s Fisheries Sector Doubles Output in 11 Yearsn

India has witnessed a remarkable transformation in its fisheries sector, with total fish production more than doubling in just over a decade. The growth underscores the success of government-led initiatives under the Blue Revolution and Pradhan Mantri Matsya Sampada Yojana (PMMSY).