Current Affairs 23 & 24 February, 2025

Daily Current Affairs Quiz
23 & 24 February, 2025

International Affairs

1. New Trump Era

Context:

Trump’s said to have symptoms of a second term that will worsen instability all over the world. The world will no longer have any illusions on the fact that the post war basis of governance is being dismantled. It means a shift away from collective security to power politics and more U.S. withdrawal from global institutions.

From Stability to Chaos: Decay of a System

• It integrated economic self determination, global collective security, and self determination into structures post World War II. This has been a quite flawed order but has so far managed to restrain flagrant abuses by the major powers.

Isolation From International Agreements

• Isolation from international agreements, such as the Paris Accord, WHO, NATO, has left allies dry.
• Tariff wars and economic nationalism distorted the world economy.
• Trump direct contacts with Putin, without mentioning Ukraine, points to a restore to great power deals that include smaller countries at their expense.

A World Power Politics Redrawn

• Thus, leaving the U.S. serves as an usher to a new geopolitical reality.
• Russia waning dominance in Europe, of course, at the expense of a weakened NATO.
• China sees in it an opportunity to further develop its influence, particularly over Taiwan.
• Americas, facing inward, will care not what’s happening in the former ally countries.
• Abandon Ukraine leaves Russia stronger and European states with the allocation of their security.
• The unchecked expansion of ambitions over Taiwan and the territorial integrity of India raises concerns.
• The new US-Russia backchannel meetings in Riyadh appear strikingly similar to those associated with past power deals. However, in this case, it dallies with surrender instead of a victor’s peace.

What It Means for India?

• China’s Indiscretion is a Security Threat Directly especially along the McMahon line.
• India needs defense alliances, which must thus be more defensive and offensive than ever before in the face of ever changing power structures over its neighbors.
• The resulting instability in the global arena could even affect growth at home, thus requiring a changed foreign policy.

A world ruled by power replaces the now vanished rules or even laws based order. India visible in the world itself should quickly prepare for a much different era of strategic uncertainty.

National Affairs

1. Submarine Developments in India

Project 75 (The Foreign Procurement Route)

• Procurement of six diesel electric submarines.
• Contract negotiations to begin between Mazagon Dock Shipbuilders Ltd. (MDL) and Germany’s TKMS.
• Expected cost is ₹70,000 crore (increased from the benchmark of ₹43,000 crore).
• The first submarine will be delivered not before seven years from the contract finalization.

Project 76 (Indigenous Submarine Development)

• DRDO is preparing to submit the proposal for Cabinet Committee on Security (CCS) approval within two months.
• Design phase: 2–3 years
• Construction: 5 years → first submarine delivered in ~8 years.
• Specifications
  • 3,000 tonne displacement

Capable of launching Land Attack Cruise Missiles (LACMs)

• 90-95% indigenous content, only electronics and some tubes will be imported.
• The design is based on the Advanced Technology Vessel (ATV) Project: Arihant class of nuclear submarines.

Scorpene Class Expansion

• Contract for three more Scorpene class submarines to be signed soon.
• First delivery is expected by 2030.

Indigenous SSN (Nuclear Attack Submarine) Programme

• Individually, it is in the design phase (4-5 years).
• Construction and validation: another 5 years.

Present Status of the Submarine Fleet of the Indian Navy

• There are 17 conventional submarines, most of which are ageing.
• There is an urgent requirement for new submarines to sustain the force levels.
• With Project 75 and Project 76 progressing almost in parallel, India is pushing for self reliance in submarine technology, while supplementing its fleet with foreign built units.

2. New Legal Framework for Digital Content Regulation

Context:

The Information and Broadcasting Ministry is examining the existing statutory provisions and the need for a new legal framework to regulate “harmful” content amid complaints of “obscenity and violence” being shown on digital platforms.

What is Freedom of Speech?

Concern of Misuse of Free Speech

• The government says, “freedom of expression is being misused to promote obscene and violent content.”
• Concerns raised by the Supreme Court & the National Commission for Women.

Parliamentary Committee’s Interventions

• The Standing Committee on Communications & IT, led by BJP MP Nishikant Dubey, demanded amendments to crack down on controversial content.
• Members across party lines have spoken to support tougher regulation.

Current Regulatory Gap

• There is a specific regulatory framework for print and electronic media, but OTT platforms and YouTube are not regulated as of yet.
• The Supreme Court hinted about a “vacuum” in the law, suggesting that it would step in should the government fail.

Govt Advises OTT Platforms

• The Ministry issued an advisory asking OTT platforms to maintain strict compliance with IT Rules, 2021.
• Self regulatory bodies were urged to promptly take action against the violations.

With increasing concern about digital content, the government is inching toward increased surveillance but still balancing concerns about possible censorship.

3. Three-Language Policy: Tamil Nadu vs NEP 2020

Context:

The Union Government has withheld ₹2,152 crore in the Samagra Shiksha due to Tamil Nadu’s refusal to join the PM Schools for Rising India initiative. The State opposes the National Educational Policy (NEP) 2020, particularly the three language formula.

What Does NEP 2020 Say?

• Retains the three language formula from NEP 1968
  • Flexible choice of languages, however, at least two must be native to India. Stress on bilingual teaching along with an optional Sanskrit inclusion.
• Less explicit compulsion for Hindi unlike in past
  • NEP 2020 sets out guidelines for states to formulate their own language policies, which seem to undermine Tamil Nadu’s position. Interaction will informally indicate Tamil Nadu’s rejection of such ideas.
• Evolved i.e., Act I, all the way since to: Tamil + English
  • 1937-65 anti Hindi agitations created a deeply embedded opposition to Hindi imposition.
  • A fear that its implementation, will, through the very lack of regional language resources, indirectly bolster Hindi. The Union government has traditionally promoted Hindi, employing funds, including the salaries of Hindi teachers in non Hindi States.

Political Stand

• TN must “align with the Constitution” said by a minister.
• Some Accuse Centre of making “blackmail” threats toward Tamil Nadu and vows “to oppose Hindi imposition” .

Potential Solutions

• Participation in constructive dialogue or discourse aimed at compromising linguistic diversity with policy flexibility between the Centre and TN would be.
• Recognition of TN’s very strong educational metrics even in the absence of the three language model.
• Politicization of Samagra Shiksha funds must be avoided so that students’ welfare is not compromised.

On the other hand, the Centre Tamil Nadu standoff brings to the fore linguistic and federal tensions, which require collaborative solutions rather than policy ultimatums.

4. Majorana 1

Context:

Microsoft recently announced the Majorana 1 chip in a bold gesture toward practical quantum computing, which they now claim remains “years, not decades” away. In fact, Microsoft is now in good company with Google and IBM, which have also made large strides in the area.

Highlights of Majorana 1

• Breakthroughs in Quantum Computing
  • Quantum computers can solve problems exponentially faster than classical ones, with enormous applications in medicine, materials science, finance, and AI.
  • The primary challenge is error prone qubits, which limit their practical use.
• What Is Special About Majorana 1?
  • MS claims that the chip works more stably and is less error prone than current quantum architectures.
  • It works with the Majorana fermion, that is, a theoretical subatomic particle proposed in the 1930s.
  • If proven, this means we might have a fault tolerant quantum computer sooner than expected.
• Doubts and Outside Verification
  • Physicist from Harvard Philip Kim called it an exciting development but some scientists have reservations.
  • Experts stated that there is a need for more conclusive proof to verify that Majorana 1 performs as claimed.

Impact on Quantum Computing

• This specific instance can expedite further technologies in drug discovery, climate modeling, and cryptography.
• The suggestion from Microsoft of being “years, not decades” away from quantum advantage positions us for a possible technological revolution in the not too distant future.

Majorana 1 from Microsoft could serve as a ”game changer,” but its full possible performance remains uncertain due to www open source independent verification. Should that prove possible, Microsoft would then be placed in the forefront of the quantum computing race along with Google and IBM.n the fence for now, and Microsoft has everything to prove.

5. Quantum Computing

Quantum Computing Becomes Even More Important

• International Year of Quantum Science and Technology, the UN has declared as 2025.
• Quantum computing has made it a global race among government and private investments.
• From medicine to chemistry, AI, materials, to cryptography, these computers might be the key for change.

What Is a Quantum Chip?

• Quantum chips, on the contrary, allow qubits that can be in a superposition-both 0 and 1 at the same time, whereas the conventional computer is working with bits (0 or 1).
• There are different approaches to implementing qubits, for example, superconducting devices, semiconductors, and photonics.
• Key Players
  • Superconducting qubits-IBM, Google, QueRa
  • Semiconductor qubits-Intel, Diraq, SQC
  • Photonic qubits-PsiQuantum, Xanadu

Qubit Quality vs. Quantity

• A large number of low-quality qubits will be worthless. What is needed for actual applications are high-fidelity qubits.
• Challenges
  • Qubits are very susceptible to noise from the environment.
  • Quantum error correction is necessary to enhance fidelity.

Research Advances in Quantum Error Correction

• Researchers have constructed “logical qubits” that use several imperfect qubits to cancel errors.
• New developments in quantum error correction will be unveiled in 2024 by Google, QueRa, IBM, and CSIRO.
• To date, only a few single logical qubits have been demonstrated successfully-the next challenge is to build a network of logical qubits.

Quantum Supremacy and Future Applications

• Quantum supremacy is defined as the point at which a quantum processor is performing better than classical ones.
• In late 2024, quantum supremacy was shown for a hard computational problem by Google’s Willow quantum chip.
• Envisaged future applications include:
  • Medical breakthroughs: New drug discovery and understanding of genetic diseases.
  • AI and Cybersecurity: Fortifying encryption mechanisms and making AI decision making better.
  • Material Science: Creating advanced novel materials that have new properties.

What Is Happening in 2025?

• Expect the quantum chips to scale up to be able to accommodate logical qubits and allow for stable computation.
• Quantum software and algorithms will get developed whilst anticipating actual quantum applications.
• The field needs to push simultaneously in terms of hardware, fidelity, error correction, and algorithms.

This year 2025 is poised to mark a watershed moment in quantum computing, with predictions of breakthroughs being made in scalability, error correction, and applicable real-world uses.
The fully functioning quantum computer is still a distant goal, but the imminent preparations for it will build the foundation for tomorrow’s computers.

Source: The Hindu

6. India’s TB Eradication

Context:

The PM’s ambition of eradicating TB by 2025 is stymied due to lackluster bureaucratic action.
TB screening AI chest X ray tools have been evaluated and approved by health agencies but are not being used in any capacity by the national programme.
Central TB Division (CTD) of the Health Ministry is supporting an unverified AI tool DeepCXR while neglecting two highly researched, effective, and affordably priced avenues qXR and Genki.

AI Options for TB Screening

• Two AI technologies qXR (Qure.ai, Bengaluru) and Genki (DeepTek, Pune):
  • Approved by HTA and Medical Technology Assessment Board (MTAB).
  • Mostly tested and validated with published studies.
• Implementation in Over 3,100 sites across 90 countries (qXR) and in 80 sites across 15 Indian States (Genki).
• Highly Cost effective at ₹30 per scan (qXR) and ₹22 per scan (Genki).
• Sensitivity: Really over 90%, keeping in line with WHO TB screening accuracy standards.

DeepCXR (Institute for Plasma Research, Gandhinagar)

• Recommended for the national TB programme, however, it lacks peer reviewed validation.
• No published data regarding its field performance, sensitivity or specificity.
• DeepCXR is trained on 54,000 X rays, however, it is uncertain whether it has ever been used in real world TB screening.

Bureaucratic Delays and Inconsistencies

• HTA approval is not essential, but the Central TB Division is waiting for it before proceeding with new TB technologies.
• Notwithstanding their approval, qXR and Genki remain excluded from the national programme.
• Instead, the unvalidated DeepCXR was recommended, with no formal communication to the respective States.
• States became aware of DeepCXR when they inquired into AI solutions for TB detection.

Importance of AI Assisted TB Screening

• X ray screening is fundamental
  • 42.6% of the TB cases in India were detected by X ray screening in the National TB Survey conducted from 2019 to 2021.
  • 39% of TB cases were detected solely by X ray screening in the 2021 22 survey conducted in Tamil Nadu.
• AI driven interpretation of X rays
  • Fast (in under a minute).
  • Cost effective.
  • Feasible in low resource settings.

The Central TB Division must take urgent action on validated AI tools; that is, qXR and Genki must be rolled out for immediate acceleration in TB detection.
Clear policy guidelines are needed to avoid bureaucratic red tapes.
Ensuring AI solutions undergo independent validation prior to their adoption into national programmes.

Banking/Finance

1. Rupee Swap by RBI

Context:

The Reserve Bank of India (RBI) has introduced a dollar denominated rupee swap auction to inject $10 billion into the economy. This is done to meet long term liquidity concerns of domestic banks.

Comparison with Earlier Swap Auctions

• This would be the second such rupee infusion within a month.
• Had a first assignment of $5 billion on January 31, 2025, with a tenor of six months.
• The latest $10 billion tranche has a three year duration, indicating a focus on long term liquidity stability.
• The combined effects of either of the two swaps are expected to inject 1.3 trillion rupees in the Indian banking system.

Reason Behind the Action

• The RBI’s goal is to stabilize the rupee, overcome liquidity constraints, and control inflationary pressures.
• Economists suggest that an additional $5 billion swap may be required to fully address the ₹1.7 trillion liquidity shortfall in Indian banks as of February 20, 2025.

Existing Economic Drags

• Rupee depreciation
  • The Indian rupee has fallen 3.3% against the U.S. dollar since October 2024, crossing ₹85 per dollar on December 19, 2024.
• Foreign outflows
  • In this period of time, about $31 billion exited from Indian equity markets.
• Forex reserve depletion
  • The RBI has already sold about $111.2 billion (~18% of forex reserves).

Long Term Economic Effect

• Today’s challenges are more pressing because, unlike 2019, when forex reserves were rising, today, they are also being sustained.
• These banks need to use this liquidity to provide credit so that economic momentum is strong in terms of investment, employment, wage growth and consumption.
• Al these measures could push GDP growth in India beyond the current 6.4%, notwithstanding global economic headwinds.

This newest dollar rupee swap isn’t a proactive measure, just like the first; rather, it’s stabilization of the rupee with possible liquidity constraints. How well the additional liquidity gets put to use by Indian banks would determine how effective the change proves to be.

2. Qualified Institutional Buyers (QIB)

Context:

Markets regulator Sebi is looking to expand the definition of qualified institutional buyers (QIB) and remove the 200-investor cap, allowing angel funds to access a broader pool of accredited investors.

What is Qualified Institutional Buyers (QIB)?

Key Highlights:

• Qualified Institutional Buyers (QIB) will now include a wider range of accredited investors.
• The present cap of 200 investors may be removed keeping angel funds open to a broader pool of investors.
• To deepen the debt securities market and boost startup funding.
• There is still concern about issues like investor verification, onboarding financially poor investors, and conflict with the provisions of the Companies Act, 2013.

Why It Is Important?

• This means more money for startups
  • The broader the definition of QIB, the more likely it is to make venture capital and angel investing liquid. Startups will have more sources of funding.
• A much stronger debt market will be
  • The inclusion of other institutions under the QIB definition would certainly strengthen India’s corporate bond market as it would allow a larger number of investors to get attracted towards debt securities.
• Regulatory Conundrums
  • It would be necessary for SEBI to put in rigorous checks on investor eligibility to ensure that financially poor individuals are not allowed into high risk investments.

It is expected that before implementation of such changes SEBI would first issue a consultation paper where it would adopt a more balanced strategy between protecting the investors and expanding the market.

3. Current Deposit Insurance Framework

Context:

Deposit Insurance and Credit Guarantee Corporation of India (DICGC) covers every depositor up to ₹5 lakh in all banks.

• Proposed Increase: The government is considering raising this limit to an ₹15 lakh threshold in order to strengthen depositor protection.
• Past Increases in Insurance Coverage: The last increase in deposit insurance was done in February 2020 (from ₹1 lakh to ₹5 lakh) and this was just the second increase that has occurred since 1993.

Challenges and Considerations

• Should Deposit Insurance Stay Updated?
  • RBI Deputy Governor M Rajeshwar Rao states that a growing economy and increasing deposits from banks require the insurance limit to be updated now and then.
• The Past Revised
  • Since in 1968 the insurance limits were revised six times, these have stayed long silent since then after the last revision of 1993.

Is a Shift to Risk Based Deposit Insurance Needed?

• Current Premium Structure
  • Flat 12 paise per ₹100 of deposits annually.
• Proposal
  • Premiums on deposit insurance should be determined by a bank’s risk profile (similar to credit ratings for bonds).
• Benefits That May Arise
  • More governance since banks will be incentivized to maintain strength.
• Market discipline
  • creditors may prefer to deposit in banks with good ratings.
• Reasons for Concern
  • May lead to flight of deposits from weaker banks, leading to systemic instability.
  • Calls for gradually designing to discourage flight by incentivizing stronger banks.

Should Deposit Insurance Cover NBFCs?

• NBFCs D currently cannot avail of DICGC coverage.
• Need for this
  • Deposits securitised by NBFC took a jump of 20.8% in FY24 reaching ₹1.02 trillion.
  • Financial turbulence in NBFCs creates panic withdrawals.
• Regulatory Dilemma
  • RBI has exercised mild restriction on NBFC deposit growth to protect investors.
  • Past committees (Capoor Committee, 1999) have deliberated on the possibility of extending deposit insurance to NBFCs, but no decision was made.

Global Context: Where India Stands

• India 3rd Overall in Asia Pacific (for insured deposits provided to depositors)—with a ratio of 46.3% of total deposits.
• Countries with More Coverage
  • Japan (69.1%)
  • Korea (51.7%)
  • US (56.6%)

The Road Ahead

• Should deposit insurance limits be regularly reviewed for changes in the economy and deposit trends?
• Promote gradual shift to risk based premiums in order to avert flight of deposits from weaker banks.
• Possibly extend coverage to deposits in NBFCs to protect against systemic risk.
• Higher governance standards in cooperative banks should be imposed to reduce the chances of failure.

An appropriately calibrated deposit insurance program shall prove imperative for financial stability and depositor confidence.

4. Tough Days for Banking Sector

Context:

Some banks of which City Union Bank, Karnataka Bank, Bandhan Bank, South Indian Bank, DCB Bank, and Punjab & Sind Bank have net NPAs over 1%.

Key Highlights:

• The banks such as Axis Bank, HDFC Bank, ICICI Bank, Kotak Mahindra Bank, Indian Bank, and Punjab National Bank have net NPAs below 0.5%.
• Gross NPAs
• Bandhan Bank, J&K Bank, and PNB are holding bad loans above 4%.
• Axis Bank & HDFC Bank are with gross NPAs of less than 1.5%.

NPAs Trend Analysis

• Private banks experienced a slight upturn in gross NPAs (₹1.35 trillion in Sep 2024 → ₹1.39 trillion in December 2024).
• public sector banks, part of which are CBA%, reduced the gross NPAs from ₹4.93 trillion in December 2023 to ₹4.47 trillion in December 2024.

The Effect of RBI’s Unsecured Loan Measures

• RBI raised risk weights on unsecured loans in Nov 2023, thus increasing their cost.
• Through this, the growth of bad loans has been controlled.

Interest Income & Profits

• Net Interest Income (NII) rose
  • To Private banks: ₹93,416 crore → ₹1.02 trillion (YoY growth: 8.88%)
  • From PSBs: ₹1.02 trillion to ₹1.07 trillion (YoY growth: 5.44%)
• Net profit
  • Private banks: Grew 3.79% YoY but registered a fall of 2.48% QoQ.
  • PSBs: Grew 46.81% YoY but registered a fall of 2.36% QoQ.

CASA Ratio (Current & Saving Accounts Deposits) Declining

• Most banks have seen declines in CASA deposits, thereby suppressing low cost funding.
• Very few banks like Yes Bank, Union Bank, Indian Overseas Bank, Federal Bank have recorded minute increases in CASA.
• Top CASA Holdings States:
  • Bank of Maharashtra (49.28%)
  • Central Bank of India (49.18%)
  • J&K Bank (48.17%)

Net Interest Margin (NIM) Under Stress

• Almost all banks have reported low NIM for December quarter.
• Highest NIMs
  • Bandhan Bank (6.9%)
  • IDFC First Bank (6.04%)
  • IDBI Bank (5.17%)
• Further pressure would be created on NIMs by RBI’s rate cut, as banks would reduce their lending rates while deposit costs remain unchanged.
• Battle Continues Over Deposits
  • Some depositors returned to banks due to corrections in the equity market and lower mutual fund flows.
  • But the profit is getting squeezed due to high deposit costs.

Keeping aside investments, banks will brighten up the bad loans while facing challenges from low cost funding and with profit shrinkage. The rate cuts from the RBI and the war over deposits would keep the banks on their toes for the coming quarters.

Economy

1. IRDAI Pushes Insurer to Capitalize ₹300 Crore

Context:

IRDAI has directed insurance companies to infuse ₹300 crores into the upcoming digital insurance marketplace called Bima Sugam, by the end of February. This was discussed at ‘Bima Manthan’, a two day event at which the insurers interface with the regulator on industry matters.

Key Highlights:

• Each insurers hits at around ₹5 crore, with the major ones like SBI Life, HDFC Life, and ICICI Prudential securing their board approval for investment.
• Capital requirement for Bima Sugam has increased to ₹500 crore, which is now both higher and lower than the original estimate that stood at around ₹100-₹200 crore.

What is Bima Sugam?

• Also termed as “UPI moment for insurance,” Bima Sugam is a one stop digital platform for comparing, purchasing, and managing various insurance policies that will encompass life, health, and general insurance.
• Moreover, it provides a very cost effective option for distributors.
• The Bima Sugam is part of the IRDAI’s ‘Bima Trinity’ initiative, which includes:
  • Bima Sugam: A centralized digital insurance marketplace.
  • Bima Vistaar: Rural focused insurance product.
  • Bima Vahak: A network of women led insurance agents.

Launch Timeline and Industry Participation

• Phase I is expected to be launched in mid 2025, after several delays since the project was proposed in the earlier part of the years.
• The Bima Vahak portal, meant for local insurance agents to be onboard, has almost culminated and is set for soft launched in April 2025.
• Major insurers like LIC, New India Assurance and ICICI Lombard have already received board approvals for contributing funds to the project.

2. Prudence vs. Populism

Key Findings from 2025-26 Budgets of Five Big States

• States with Revenue Surplus: Uttar Pradesh, Gujarat, and Odisha
• States with Revenue Deficit: Rajasthan and West Bengal
• Debt Wise Concerns: These two states, Rajasthan and West Bengal, carry high sovereign debt and fiscal deficits.
• Capital Outlay: Odisha and Uttar Pradesh have the highest capital outlay in relation to the size of their economies.

Uttar Pradesh: Balancing Growth & Welfare

• The largest economy of the five states but lowest per capita income
• Despite a large welfare focus (with 92,000 jobs, salary hikes, and scooters for women students), it maintains a revenue surplus
• 43% of revenue receipts come from own taxes
• Debt to GSDP Ratio ~30%

Gujarat: Strong Fiscal Position

• Most prosperous state among the five, per capita income three times that of Uttar Pradesh
• Self sufficient revenue generation (over 60% from its own tax sources)
• Lowest debt to GSDP ratio (~15%) of all five states
• Moderate capital outlay relative to GSDP

Odisha: High Capital Investment, Low Debt

• Revenue surplus maintained in the face of increased spending
• Central assistance is received (only 28% of revenue from own taxes)
• High capital outlay (6.1% of GSDP) among the highest
• Lowest debt to GSDP ratio (12.7%)

West Bengal: Fiscal Struggles Continue

• It is a revenue deficit state that holds high sovereign debt (~38% of GSDP).
• Very low capital outlay relative to total expenditure (1.94% of GSDP).
• Own tax revenue stagnated (~42% of revenue receipts).

Rajasthan: Rising Debt, Low Investment

• Fiscal deficit crosses limits (more than 3.5% of GSDP).
• Debt to GSDP ratio at 36.5% (second highest following West Bengal).
• Lowest capital outlay in relation to total expenditure.

Gujarat and Odisha have the strongest fiscal positions; both states are with high own tax revenue and manageable debt. UP is maintaining revenue surplus, yet a lot of dependency on central funds.
WB and Rajasthan are confronted with severe debts and deficits, which impede any possibilities for their investment potentials.

3. Investment in Gold

Context:

Gold tops all other financial assets in 2024, rising 42 per cent at a dollar price, and over 13 per cent in rupees. Aggressive buying by central banks continues to add on for 2024, 1,045 tonnes into three years’ consecutive purchases of above 1,000 tonnes.

The Reasons for Gold Prices Going Up

Economic and Political Factors

• Inflation & Economic Incertitude
  • Global economy goes down; supply chains disturbed (due to pandemic, due to war in Ukraine, Middle East turmoil).
• Effects of United States Policy
  • Rumors concerning his administration imposing tariffs on gold increase demand.
• Central Bank Demand
  • Governments, mainly with China’s and India’s help, increase their gold reserves as a safeguard against inflation.

Market Trends & Their Effects in Investment

• A Strong Dollar Against Gold Prices
  • On theory, a strong dollar retards gold prices; at the same time, inflationary fears and central bank demands push up the gold price to record highs.
• Diminished Supply
  • Mining and refining gold take years, so it might lead to the possible price spikes with the increased demand.

Gazing into Investment Opportunities & Risks

• Gold ETFs & stocks in mining companies
  • Attracting powerful inflows from these channels thanks to the rising price of gold.
• Jewelry Sector
  • Demand goes up when gold prices go high, but managing inventory costs of stock becomes an issue.
• Gold Backed Loans
  • Risk calibration should be done by lenders, as high prices increase the collateral value, but there is also a risk in case of defaults.

Will Gold Continue Its Bull Run?

Gold will maintain its role of safe haven asset in periods of economic turbulence.

Gold remains in demand while the global uncertain scenarios remain, whereas it can be expected to go through price swings if US revalues its gold reserves or imposes tariffs.

Agriculture

1. Makhana Board in Bihar

Context:

Shivraj Singh Chouhan and Bihar Deputy CM link up with Makhana farmers in Darbhanga just a couple of days prior to PM Modi’s Bihar visit. At PM Modi’s behest, 19th PM Kisan Nidhi installment brought out and development projects inaugurated.

Key Highlights:

• Establishment of Makhana Board under Union Budget FY26 aims to have a major impact on production, processing, and exports.

Importance of Makhana in Politics and Economics

What is Makhana Important For

• Bihar is home to 90% of Makhana produced by India, which is now declared a superfood on earth.
• The area under cultivation has increased from 13,000 hectares in FY13 to 35,224 hectares in FY22 showing an increase of 171% over a period of 9 years.
• Production is concentrated in 10 key districts of Mithilanchal & Seemanchal, creating jobs.

Government Initiatives

• For NABARD: This would include financial support for storage and processing infrastructure.
• Makhana Board (Union Budget FY26): Branding, marketing, and farmer support were centered.
• One District, One Product Scheme: Noted priority crop given highest focus by Bihar is Makhana.
• Support of APEDA & NHM: Boosting exports and offering subsidy support to achieve better production.

2. Soil Nutrient Management

• Imbalanced Fertiliser Application
  • Currently, the fertiliser subsidy system in India favours urea, resulting in excess nitrogen applications and less incorporation of phosphorus and potassium.
• Skewed NPK Ratio
  • The NPK used ratio in the year 2021 22 was 7.7:3.1:1, which they said was never close to the realistic ideal ratio of 4:2:1, leaving soil degradation and groundwater pollution in its wake.

Advance in a Decade Through SHC Schemes

• Customized Soil Recommendations
  • More than 247 million Soil Health Cards (SHCs) were already issued in India to support farmers on balanced fertilization.
• Infrastructure for Better Soil Testing:
  • Setting up 8,272 Soil Testing Labs (STLs), some of which feature 665 Village Level STLs distributed across 17 states.
  • 1,020 schools implementing soil health programs, including the entry of 1,000 STLs, with more than 100,000 students participating.
• Geospatial Technologies & SHC Mobile App combined for precision soil mapping and real time soil sample tracking.

Issues Attached to SHC Implementation

• Under Staffing, Resources & Infrastructure Facilities
  • Most of the STLs are under staffed in terms of people as well as resources and suffer from the attainment of timely test results.
• Lower Compliance of Recommendations
  • Farmers do not usually get the SHC prescription, let alone follow it, hence depriving this scheme of effectiveness.

Technological Innovations for Soil Testing

• Portable AI Enabled Soil Testing Kits
  • “KRISHIRASTAA Soil Testing System” (IoT based) conducts 12 key soil tests in 30 minutes.
  • Developed by ICAR IIRR & Agritech Startup KrishiTantra, soil testing will be telephone patented to bring speed, scale, and cost savings to solutions.
• AgriTech Startups
  • by using AI to make soil testing faster, they can provide rather affordable and innovative solutions to the farmers.

The Way Forward

• Scale up Real Time Agronomic Advisory Services: so that the SHC recommendations are properly acted upon.
• Raise Awareness & Farmer Education: on both balanced fertiliser use and SHC benefits.
• Enhance STL Infrastructure & Workforce: Increase the scope and effectiveness of the system.
• Dramatically Scale Up AI Enabled Soil Testing Technology: Fast, accurate testing is the goal.

Thus, India will march towards sustainable agriculture and increased productivity by matching advances in technology with soil specific programs.

Facts To Remember

1. Dream of 20 lakh families to have their own home fulfilled under PMAY: Shah

Union Home Minister Amit Shah in Pune said with 20 lakh beneficiaries receiving sanction letters under the Pradhan Mantri Awas Yojana (PMAY) ‘Gramin’ (Phase 2) in a single day, the long-cherished dream of these families to own a home has been fulfilled.

2. Shaktikanta Das appointed Principal Secretary II to PM

Former Reserve Bank of India Governor Shaktikanta Das has been appointed Principal Secretary II to Prime Minister Narendra Modi, said a notification issued by the Secretariat of the Appointments Committee of the Cabinet.

3. Rescue team yet to contact workers trapped in tunnel

Rescue teams could not achieve a breakthrough till late evening in tracking eight persons trapped for over 30 hours in an under-construction tunnel in Nagarkurnool district of Telangana.

4. Committee to submit its report on Income Tax Bill 2025 on first day of mansoon session

The meeting of the Select Committee of Lok Sabha examining Income Tax Bill 2025, was held in New Delhi today. The 31-member panel has been headed by BJP MP Baijayant Panda. The Committee will submit its report by the first day of the monsoon session of Parliament.

5. PM Modi releases 19th installment of PM-KISAN scheme

 Prime Minister Narendra Modi released the 19th instalment of the Pradhan Mantri Kisan Samman Nidhi (PM-KISAN) scheme from Bhagalpur in Bihar this afternoon. 

6. Arunachal Pradesh achieves 100% completion of houses under PMAY-G

Arunachal Pradesh has achieved a hundred per cent completion of houses under Pradhan Mantri Awas Yojana – Gramin. This was informed by Chief Minister Pema Khandu in a social media post. Mr Khandu said that the target in the state was achieved on February 21 this month.

7. PM Modi congratulates farmers on 6th anniversary of PM-Kisan Yojana

Prime Minister Narendra Modi congratulated all the farmers across the nation on the sixth anniversary of the PM Kisan Samman Nidhi Yojana, a landmark initiative dedicated to supporting and uplifting the farmers of India.

8. Indian women’s team thrashes Nepal 113-32 in SABA Championship Opener

In basketball, the Indian women’s team thrashed Nepal with a resounding 113-32 victory in their opening match of the South Asia Basketball Association (SABA) Women’s Championship in Delhi.