Daily Current Affairs (DCA) 22 March, 2025

Daily Current Affairs Quiz
22 March, 2025

International Affairs

1. India–New Zealand Relations

Key Geopolitical Shifts

• Shift from rules-based order to power-driven geopolitics
• Growing emphasis on security over economics
• Transition from trade efficiency to protectionism and trusted supply chains

India–New Zealand Partnership Potential

• Shared interest in freedom of navigation in the Indo-Pacific
• Despite not being part of the Quad, New Zealand engages with regional partners (Australia, Japan, South Korea)

Agreements Signed

• Defence MoU for enhanced military cooperation, staff exchanges, and naval port visits
• Decision to restart free trade talks (current bilateral trade under $2 billion)

Trade Challenges

• Issues with market access for dairy and agricultural products
• India’s past exit from RCEP due to similar concerns
• New Zealand’s trade with China valued at $24 billion

Connectivity Boost

• Codeshare agreement between Air India and Air New Zealand
• Potential for direct flights by 2028

Diplomatic Concerns

• PM Modi raised concerns over anti-India activities (Khalistan protests in Auckland)
• New Zealand reaffirmed commitment to free speech, while discouraging foreign political conflicts within immigrant communities

While diplomatic sensitivities exist, both nations stand to gain from strengthened cooperation in trade, defence, and regional stability as democratic partners in the Indo-Pacific.

2. Glaciers Losing Ice

Context:

Glaciers worldwide have lost 9,000 gigatonnes of ice since 1975, equivalent to an ice block the size of Germany with a thickness of 25 metres. 2024 alone saw glaciers losing 450 gigatonnes of mass one of the highest annual losses on record. Five of the last six years have registered record-high glacial mass losses.

Consequences of Glacier Melting

• Melting glaciers are among the largest contributors to sea level rise, endangering millions with increased flood risks.
• Between 2000 and 2023, glacier melt caused 18 millimetres of global sea level rise.
• Every millimetre of sea level rise can expose up to 300,000 people to annual flooding.
• Around 1.1 billion people in mountain communities face immediate impacts due to shrinking glaciers affecting water supply, hydroelectric energy, and agriculture.

Global Concern and Action

• The report was released at the UN headquarters in Geneva alongside the first World Day for Glaciers, calling for global action.
• The Unesco summit in Paris urged stronger initiatives to protect glaciers.

Call for Scientific Advancement

• Stefan Uhlenbrook (WMO) emphasized the need for
  • Improved observing systems
  • Better forecasts and early warning systems
  • Strengthened scientific research on glacier behavior and its impacts

Freshwater Reserves at Risk

• 275,000 glaciers remain globally, along with Antarctic and Greenland ice sheets, holding approximately 70% of the world’s freshwater.

National Affairs

1. Web Browser Ulaa

Context:

The Indian government has awarded ₹1 crore to Tenkasi-based Zoho Corporation for developing an indigenous web browser named Ulaa.

Key Purpose

• The core requirement for the browser is to trust India’s own root certifying authority.
• This move aims to ensure India has internet resilience in case of a global internet disconnection or security crisis.

What is a Root Certifying Authority?

• These are organizations that validate the trustworthiness of SSL certificates (seen as the “https” lock icon in URLs).
• India’s Controller of Certifying Authorities (CCA) under the IT Ministry has its own root certificate.
• However, after a 2014 security breach, where fake SSL certificates were issued from government systems, major browsers stopped trusting CCA’s certificates.

Current Status

• Only one Indian company, eMudhra’s emSign, is globally recognized as a root certifying authority.
• The new browser Ulaa is designed to accept the Indian root certificate, reinstating domestic trust and security.

2. Parliamentary Committee Recommends Expansion of PLI Scheme

PLI Scheme

A) Current Framework

• The Production-Linked Incentive (PLI) scheme currently covers 14 sectors with an outlay of ₹1.97 trillion.
• Sectors include mobile phones, drones, white goods, telecom, textiles, automobiles, specialty steel, and pharma.

B) Proposed Expansion

• The committee suggests extending PLI coverage to labour-intensive sectors such as:
  • Chemicals
  • Leather
  • Apparel
  • Handicrafts
• Additionally, it recommends including strategic manufacturing sectors like:
  • Defence manufacturing
  • Aerospace
  • Ship containers

C) Analytical Perspective

• Why this matters:
  • Labour-intensive sectors can generate large-scale employment, aligning with India’s demographic advantage.
  • Boosting defence and aerospace manufacturing will enhance self-reliance and security capabilities.
  • Expanding PLI to these sectors can improve export diversification and reduce dependence on a few products or markets.
• Monitoring recommendation:
  • The committee has stressed the need for a robust framework to monitor and report PLI’s impact, which is crucial for course corrections and efficient fund allocation.

Concerns Over National E-Commerce Policy

• The committee raised concerns about the lack of a clear timeline for the policy’s launch under the Department for Promotion of Industry and Internal Trade (DPIIT).
• Analytical Insight
  • In the absence of a clear policy framework, e-commerce growth could face regulatory uncertainty, potentially slowing down innovation and foreign investment.
  • Timely finalisation would enhance consumer protection, data governance, and cross-border e-commerce facilitation.

Focus on Export Competitiveness

A) Interest Equalisation Scheme (IES)

• IES provided export credit cost relief but ceased on December 31 and was merged with the ₹2,250 crore Export Promotion Mission.
• The committee recommends:
  • Immediate operationalisation of the mission.
  • Incorporating key IES features into the new scheme with adequate fund allocation.

B) Analytical Takeaway

• Exporters, especially MSMEs, depend on low-cost credit to remain price competitive in global markets.
• Delays in re-operationalising IES or similar mechanisms could impact export growth momentum at a time when India is trying to expand global market share.

Free Trade Agreements (FTA) Strategy

A) Current Status

• Ongoing negotiations with:
  • US, UK, European Union, Oman, and New Zealand (planned conclusion by end of 2025).
  • Comprehensive agreement in discussion with Australia.

B) Recommendations by the committee

• Accelerate FTA negotiations and ensure mutually beneficial trade opportunities.
• Focus on increasing exports to countries where trade deficits exist, targeting:
  • Australia, Indonesia, Japan, Korea, Malaysia, the Philippines, Singapore, and Vietnam.

C) Analytical Viewpoint

• Many of India’s FTAs result in imbalanced trade, with partner countries exporting more than they import from India.
• The committee’s suggestion to target specific products and services for these markets is pragmatic to:
  • Reduce trade imbalances.
  • Encourage high-value exports in sectors like electronics, pharmaceuticals, and processed food.
  • Leverage FTAs to enhance technology transfer and labour mobility.

Strategic and Policy-Level Implications

Area	Opportunities	Challenges/Concerns
PLI Expansion	Employment generation in labour-intensive sectors; strategic autonomy	Need for careful fund management and measurable impact monitoring
E-Commerce Policy Delay	Untapped potential in rapidly growing digital markets	Regulatory uncertainty may deter investments
Export Promotion	Lowering export credit costs to drive competitiveness	Budgetary constraints and delayed scheme rollout
FTAs and Trade Balance	Greater market access and investment flows	Risk of continued trade deficits unless addressed proactively

The committee’s recommendations are forward-looking, aimed at strengthening India’s manufacturing base, enhancing export competitiveness, and strategically leveraging trade agreements.
However, the government needs to:

• Accelerate policy implementation with time-bound frameworks.
• Ensure continuous monitoring and adaptability in the PLI scheme.
• Align trade strategies with export market intelligence and product focus to reduce trade deficits.

Banking/Finance

1. SEBI Eases Norms on AMC Executives’ Mandatory Investments

Context:

The June 2024 master circular required fund managers and CIOs of AMCs to invest at least 20% of their annual compensation in the schemes they manage, without exceptions. This was aimed at aligning their interests with investor outcomes and enhancing accountability.

Key Changes

• Dual Determination Methods
  • CTC-Based Method: Investment obligations based on overall compensation structure.
  • Designation-Based Method: The seniority of the executive determines the mandatory investment percentage.
• Exemption for Lower-Income Employees
  • Employees earning less than ₹25 lakh annually are now exempt from mandatory investments.
• Effective Date: April 1, 2025.

Enforcement Mechanism

• In case of violations, AMC’s nomination and remuneration committee will conduct an initial investigation and forward recommendations to SEBI for appropriate action.

Why the Change?

• SEBI appears to recognize that a blanket rule could unintentionally penalize mid-level or junior staff and place unnecessary financial burdens.
• The flexibility shows a balancing act between aligning fund managers’ interests and ensuring practical compliance.

Potential Implications

• For AMCs:
  • Reduced friction in hiring and retaining mid-tier talent, especially in smaller fund houses.
  • Higher accountability for senior executives while maintaining operational flexibility.
• For Fund Managers:
  • Senior personnel will still have significant “skin in the game,” preserving investor confidence.
  • Younger professionals will have more freedom to plan their personal finances.
• For Investors:
  • Investor protection remains intact as top decision-makers remain financially committed.
  • May indirectly enhance long-term scheme performance due to greater alignment and morale at AMC level.

Source: TH

2. IndusInd Bank Derivative Discrepancies

Context:

On March 10, 2025, IndusInd Bank disclosed discrepancies in its derivative portfolio, which are expected to have over 2% impact on its net worth. The bank appointed PwC to conduct a review; the report is still awaited.

Board Action and Independent Investigation

• The bank’s board has decided to appoint an independent professional firm for:
  • Root cause analysis of the discrepancies.
  • Assessment of accounting treatment for derivative contracts with respect to prevailing accounting standards.
  • Identification of lapses and establishment of accountability.

Regulatory Response

• Following market concerns, the Reserve Bank of India (RBI) issued a rare statement, assuring:
  • IndusInd Bank is well-capitalised and financially stable.
  • No reason for depositors to worry or react to speculative reports.
  • Ongoing close monitoring of the bank’s financial health.

Key Financial Health Indicators

Metric	Value	Definition
Capital Adequacy Ratio (CAR)	16.46%	The Capital Adequacy Ratio (CAR) is a financial metric that measures a bank’s ability to absorb losses and maintain stability by ensuring it has enough capital relative to its risk-weighted assets, also known as Capital to Risk (Weighted) Assets Ratio (CRAR).
Provision Coverage Ratio (PCR)	70.20% (as of Dec 31, 2024)	The Provision Coverage Ratio (PCR) measures how well a bank is prepared to cover potential losses from bad loans or Non-Performing Assets (NPAs) by calculating the percentage of provisions made against the total value of gross NPAs.
Liquidity Coverage Ratio (LCR)	113% (vs. 100% requirement)	The Liquidity Coverage Ratio (LCR) is a financial metric that requires banks to hold enough high-quality liquid assets (HQLA) to cover potential net cash outflows during a 30-day stress scenario, ensuring they can meet short-term obligations.

Market Impact

• Since the March 10 disclosure, IndusInd Bank’s stock has fallen by over 24%.
• On March 21, 2025, shares closed at ₹ 685.75 on the BSE.

Promoter and Liquidity Measures

• The promoter group has expressed readiness to infuse additional capital if required, though the bank currently does not need this, given adequate capitalisation.
• The bank has aggressively borrowed around ₹ 15,000 crore in the certificate of deposits (CD) market at elevated rates, tapping state-owned banks and mutual funds for liquidity support.

Analytical Perspective

Area	Opportunities	Concerns
Independent Investigation	Could restore investor confidence and enhance transparency	Findings may reveal deeper lapses, impacting management reputation
Regulatory Assurance	RBI’s involvement and public assurance stabilise sentiment	Persistent market speculation despite RBI’s statements
Capital Strength	Strong capital adequacy and liquidity buffers in place	Heavy reliance on short-term borrowing (CD market) could raise cost pressure
Market Reaction	Opportunity for long-term investors if confidence is restored	Short-term volatility and 24% share price erosion show fragile sentiment

• The situation presents a test of governance, risk management, and crisis handling for IndusInd Bank.
• Transparency in the forthcoming independent report will be key to restoring stakeholder trust.
• Despite strong capital buffers and regulatory backing, the bank faces reputational challenges and funding cost pressures.
• Investors and market participants should watch for:
  • The independent audit report findings.
  • Any management reshuffles or accountability actions.
  • The promoter’s moves on potential capital infusion.
  • The bank’s medium-term funding strategy, given recent heavy CD market borrowing.

The Economic Times

3. Bank Credit and Deposit Growth Gap Widens

• Credit growth
  • Bank credit in India grew 11.1% year-on-year (YoY) in the fortnight ended March 7, 2025.
  • Absolute credit growth was ₹1.38 trillion over the previous fortnight.
  • Outstanding credit reached ₹225.10 trillion.
• Deposit growth
  • Deposits grew by 10.2% YoY in the same period.
  • Deposits increased by ₹2.25 trillion in the fortnight.
  • Outstanding deposits stood at ₹181.28 trillion.
• Credit-deposit gap
  • The gap between credit and deposit growth widened to around 90 basis points (bps).
  • Tight liquidity and pressure on deposit mobilisation are key reasons for this widening gap.
• Liquidity situation
  • Net liquidity deficit in the banking system stood at ₹2.32 trillion.
  • This marked the 14th consecutive week of liquidity deficit.
• Banking behavior
  • Large private banks are reducing their credit-to-deposit (CD) ratio.
  • Banks are avoiding aggressive lending due to liquidity constraints.
• RBI measures and policy actions
  • RBI has deferred changes to the liquidity coverage ratio (LCR) framework.
  • RBI rolled back increased risk weights on NBFC exposures.
  • Rationalisation of risk weights on microfinance loans has been announced.
  • Future rate cuts by RBI could help boost credit growth by lowering borrowing costs.
• Forecasts and expert views
  • ICRA has revised credit growth estimates upwards:
    • FY25: 10.8% to 11.5%.
    • FY26: 10.4% to 11.2%.
  • Saurabh Bhalerao from CareEdge expects:
    • FY25 credit growth at around 11.2%.
    • Deposit growth at approximately 10.5%.
    • Limited room for aggressive lending due to tight liquidity.
• Overall outlook
  • Credit growth could improve with policy support and rate cuts.
  • However, the liquidity deficit and challenges in deposit mobilisation remain significant constraints.
  • The gap between credit and deposit growth may continue in the near term.

4. Sebi Eases ‘Skin-in-the-Game’ Norms for AMC Employees

Key Changes

• Replaces the 2021 rule that mandated 20% of senior executives’ salaries in mutual fund units.
• Introduces a slab-based system where investment obligations vary by salary (CTC) and designation.

Investment Slabs

• Slab 0 (CTC < ₹25 lakh): No mandatory investment.
• Slab 1 (CTC ₹25–50 lakh):
  • Must invest 10% of gross CTC or 12.5% (excluding ESOPs) in schemes they oversee.
• Slab 2 (CTC ₹50 lakh – ₹1 crore):
  • 14% investment (or 17.5% excluding ESOPs).
• Slab 3 (CTC above ₹1 crore):
  • 18% investment (or 22.5% excluding ESOPs).

Employee Categories

• Category A:
  • Includes CEOs, CIOs, fund managers, and key investment staff.
  • Must comply fully with slab-based obligations.
• Category B:
  • Includes those directly reporting to the CEO and heads of non-investment departments.
  • Investment requirement limited to slab 0 or slab 1, regardless of CTC.
  • Employees managing liquid funds must adhere to slab 1, even if they qualify for higher slabs.

Lock-in Period Revisions

• Superannuation retirement: Lock-in waived (except for closed-ended schemes).
• Early retirement/resignation: Lock-in reduced to 1 year from employment end or completion of the 3-year lock-in, whichever is earlier.

Transparency & Disclosure

• AMCs must disclose total compensation invested by designated employees in scheme units.
• Disclosure to be made on stock exchange websites within 15 days after each quarter-end.

5. Sebi’s Crackdown on Misinformation and Finfluencers

Misinformation Control

• Since October 2024, over 70,000 misleading online posts and accounts have been removed.
• Sebi worked closely with social media platforms to curb deceptive financial content.

Key Regulatory Focus

• Strong crackdown on unregistered investment advisors and research analysts.
• Addressing the growing concern of finfluencers and unauthorized stock recommendations.

New Initiatives

• Proposal to introduce a UPI ‘Payright’ handle to help investors easily identify registered financial entities and avoid fraud.
• Plans for a nationwide survey to help shape Sebi’s investor outreach strategy.
• Aim to use the accredited investor model to focus on risk-aware and capable investors.

Collaborative Approach

• Call for ongoing dialogue between Sebi and stakeholders to address overlaps between:
  • Investment advisors
  • Non-discretionary portfolio management services (PMS)
  • Mutual fund distributors
  • Incidental advisory services
• Encouragement for ARIA (Association of Registered Investment Advisors) to evolve into a quasi self-regulatory organisation.

Foreign Portfolio Investment (FPI)

• Emphasis on attracting and sustaining FPI flows.
• Noted higher FPI debt flows compared to equity, following India’s inclusion in global debt indices.
• As of February 2025:
  • FPI holdings: ₹62 trillion in equity and ₹5.9 trillion in debt.

Market Development

• Highlighted the need for an adequate supply of new securities to meet investor demand and support stable capital formation.
• Focus on maintaining stable macroeconomic conditions and good governance to sustain growth.

Source: Mint

6. Sebi’s Directive on Social Media Advertisements

Context:

Sebi has directed all intermediaries to register with social media platform providers (SMPPs) such as Google and Meta for publishing financial advertisements.

Objective

• Curb fraudulent investment activities on social media platforms.
• Increase transparency and verify the authenticity of financial advertisements.

Who is affected

• Mutual funds
• Investment advisers
• Stock brokers
• Research analysts

Verification Process

• All intermediaries must register with SMPPs using:
  • Email IDs
  • Mobile numbers
    (These should match the details available on the Sebi intermediary portal.)
• SMPPs will then conduct advertiser verification before permitting ad uploads or publication.

Reason for the Move

• Rising concerns over investment-related frauds on platforms like:
  • YouTube, Facebook, Instagram, WhatsApp, X (Twitter), Telegram
• Perpetrators have been:
  • Promoting misleading testimonials
  • Offering fake trading courses and seminars
  • Promising assured, risk-free returns

Source: TET

7. Sebi Extends Deadline for Related Party Transaction Compliance

Context:

The Securities and Exchange Board of India (Sebi) has extended the deadline for listed companies to comply with industry standards on minimum information disclosure for related party transactions (RPTs).

New Deadline

• The compliance deadline has been moved to 1 July 2025 (previously set for 1 April 2025).

Scope of Compliance

• Listed entities must provide minimum specified information for review by:
  • The Audit Committee
  • Shareholders when seeking approval for related party transactions.

Background

• The new disclosure framework is aimed at:
  • Enhancing transparency in RPTs.
  • Standardizing the quality and completeness of information presented to oversight bodies and shareholders.

8. SEBI Proposes to Allow Stock Brokers to Operate in GIFT-IFSC Without Prior Approval

Context:

The Securities and Exchange Board of India (SEBI) has proposed allowing stock brokers to operate in the International Financial Services Centre (IFSC) at GIFT City without requiring prior SEBI approval. Brokers can operate through a Separate Business Unit (SBU) of the stock broking entity.

Separate Business Unit (SBU)

A Separate Business Unit (SBU), also known as a Strategic Business Unit, is a self-contained part of a larger company that operates independently, with its own vision, mission, objectives, and strategies, while still reporting to the parent organization. 

Operational Guidelines for SBUs

• The SBU must:
  • Conduct only securities market-related activities in GIFT-IFSC.
  • Be ring-fenced and maintain an arms-length relationship from Indian securities market operations of the parent broker.
  • Maintain separate accounts and net worth, isolated from the parent Indian entity.

Regulatory Oversight

• All policies, eligibility, risk management, grievance handling, inspection, enforcement, and claims related to the SBU will fall under the respective regulatory authority for GIFT-IFSC.
• Investors availing services from SBUs will not have access to SEBI’s SCORES platform, nor the grievance redressal mechanisms or investor protection funds of Indian stock exchanges.

Transition for Existing Subsidiaries

• Brokers who previously set up subsidiaries or joint ventures for securities market activities in GIFT-IFSC may now dismantle these structures and conduct activities directly under an SBU.

SEBI Cracks Down on Misleading Social Media Posts

• Since October 2023, SEBI has taken down over 70,000 misleading social media posts and accounts with help from social media platforms.
• SEBI’s whole-time member, Ananth Narayan, highlighted the growing threat of unregistered investment advisers and fraudulent research analysts.
• SEBI plans to introduce a ‘UPI Payright’ handle to help investors clearly identify SEBI-registered entities.
• Narayan emphasized the need for self-regulation and more certified investment advisors to better protect investors from online scams.

Source: TET

10. Bank of Baroda Launches ‘mDigiNext’ Mobile App

Context:

Bank of Baroda (BoB) has launched the mDigiNext mobile app to meet the cash management needs of its corporate customers. The app is designed to enhance working capital management, cash flow efficiencies, and ensure faster execution of corporate financial operations.

Key Features of the mDigiNext App

• 24×7 access to cash management tools for corporates.
• Transaction capabilities:
  • Creation and authorization of one-to-one transactions.
  • Authorization and rejection of bulk uploads.
  • End-to-end tracking of transactions and workflows.
  • Real-time transaction inquiries.
• Account management:
  • View account summaries and mini-statements.
  • Access a consolidated dashboard of all group entities.
• Enhanced security:
  • OTP verification.
  • Three-factor authentication (3FA) for secure operations.

Platform Availability

• Currently launched on Android; iOS version to follow soon.

Strategic Benefits for Corporates

• Facilitates informed financial decisions on the go.
• Streamlines corporate workflows and improves cash management efficiency.
• Positions Bank of Baroda as a tech-savvy partner for business banking solutions.

Source: Business Line

11. AdvaRisk launches AI-Powered Collateral Management for Banks, NBFCs

Context:

AdvaRisk, a fintech company backed by ICICI Bank and NABARD, is transforming collateral management for financial institutions using its GenAI-based data intelligence platform. The company serves over 50 financial institutions, including regional and smaller banks. Focuses on digitising discovery, onboarding, legal due diligence, and real-time monitoring of real estate collaterals.

Core Offerings

• Accurate verification of property titles and detection of potential encumbrances.
• Enhanced property data precision by linking property records with revenue and transaction data.
• Automated red-flagging and legal audits, significantly reducing procedural errors and human negligence.
• Real-time account monitoring, aligned with RBI mandates for lenders.

Technology as a Game Changer

• Integration of AI and machine learning to:
  • Flag discrepancies early in the loan process.
  • Mitigate cybersecurity and procedural risks.
  • Support compliance with new RBI directives.
• Solutions cater to onboarding efficiency and dynamic monitoring of collateral-backed loans.

Banking Sector Challenges Addressed

• Compliance with increasing regulatory requirements.
• Minimizing risks linked to:
  • Inaccurate property documentation.
  • Human error and manual lapses.
  • Cybersecurity vulnerabilities.
• Support for regional and smaller banks that lack advanced tech infrastructure.

Impact on NPAs and Lending Risk

• Advanced tech adoption helps reduce loan defaults and non-performing assets (NPAs).
• As per government data, gross NPAs of public sector banks stood at ₹3.16 lakh crore (3% of outstanding loans) as of September 2024.
• Early-stage risk detection by AdvaRisk can play a crucial role in reducing future NPAs.

AdvaRisk’s GenAI-powered platform is becoming indispensable for Indian banks looking to streamline collateral management, enhance risk mitigation, and adhere to evolving regulatory demands. With rising pressure on banks to improve credit quality and operational efficiency, such fintech solutions are well-positioned to reshape the lending landscape.

Source: Business Line

Economy

1. Rupee’s Surge to 10-Week High

Underlying Drivers

• Foreign Inflows:
  • Sustained foreign institutional investor (FII) inflows into equities and debt are the strongest near-term driver.
  • This indicates growing investor confidence in India’s macro stability and growth outlook.
• Trade & Reserves
  • Strong trade data signals improving export performance or controlled imports, reducing pressure on the current account.
  • RBI’s active intervention through USD/INR swaps suggests a strategic approach to stabilize currency volatility and build reserves.
• Global Factors
  • The Fed’s decision to hold rates steady and signal potential future rate cuts weakens the dollar globally, providing additional support to emerging market currencies like the rupee.

Market Behavior and Sentiment

• Currency Strength vs. Asian Peers:
  • The rupee has outperformed other Asian currencies this month, indicating India’s relatively stronger position amid global uncertainties.
• Investor Sentiment:
  • Increasing FII participation reflects confidence in India’s market fundamentals, monetary stability, and political clarity heading into 2025.
• RBI’s Role:
  • The RBI appears to be using proactive, rather than reactive, interventions — showing it is not just defending the rupee but guiding it to a stable, appreciated zone.

Equity Market Linkages

• Equity markets are mirroring currency strength, with the NSE Nifty extending gains for five consecutive sessions.
• The sharp surge in cash market volumes (+53%) shows robust retail and institutional participation, signaling broader market optimism.

Forward Outlook

• Support/Resistance Levels:
  • Rupee likely to find support at 85.70 and face resistance near 86.45.
• Risks:
  • Any reversal in FII flows or geopolitical tensions could quickly reverse the gains.
• Opportunities:
  • Continued global dollar softness, robust Indian growth data, and stable oil prices could extend the rupee’s rally.

2. Indian Bond Market and Currency Surge

Bond Yield Trends

• The yield on the benchmark 10-year government bond has dropped to 6.62%, the lowest level in three years.
• This week saw an 8 basis point decline, the sharpest weekly fall since November 2024.
• Market sentiment is driven by expectations of continued monetary policy easing, with a 25 bps repo rate cut in April already priced in and another cut in June anticipated.
• Forecasts suggest yields could soften further to around 6.60% by the end of the fiscal year.

Strong Foreign Inflows

• Foreign investors have made substantial investments under the Fully Accessible Route (FAR):
  • ₹8,560 crore in net inflows this week.
  • ₹644 crore invested on Friday alone.
• March is set to become the strongest month for foreign debt inflows since August 2024, with ₹8,497 crore invested up to mid-March.
• Total foreign portfolio investments in government securities under FAR have reached ₹2.96 trillion, close to the ₹3 trillion milestone.

Rupee Strength

• The rupee has appreciated to a 10-week high, closing below ₹86 per dollar.
• It logged its best weekly performance in two years, rising 1.1% this week.
• The rupee has outperformed other Asian currencies so far this month, reflecting robust foreign interest and stable macroeconomic fundamentals.

Key Drivers Behind the Rally

• Softer inflation data has strengthened expectations for RBI rate cuts.
• Global dovish signals, including the U.S. Federal Reserve’s indication of rate cuts ahead, have encouraged foreign inflows.
• Strong domestic growth forecasts and continued government reforms have further boosted investor confidence.

Implications and Outlook

• The sharp decline in bond yields reduces borrowing costs for the government and corporates, potentially supporting capital expenditure and growth.
• Strong rupee performance may ease import costs but could affect export competitiveness if the trend continues.
• If anticipated rate cuts materialize, both bond and currency markets may continue to see sustained inflows.
• Crossing the ₹3 trillion FAR investment mark will position India as a key destination for global debt investors, increasing market depth and liquidity.

3. E-commerce Price Index

Context:

The Ministry of Statistics and Programme Implementation (MOSPI) is considering the creation of an E-commerce Price Index (EPI).

• Purpose: To statistically estimate the prices of goods and services bought via digital platforms, tracking inflationary trends within the e-commerce ecosystem.
• Structure
  • Similar to the Consumer Price Index (CPI) for retail inflation and Wholesale Price Index (WPI) for factory-gate prices.
  • Will comprise a representative basket of goods and services, including:
    • Food products
    • Clothing and footwear
    • Housing
    • Fuel & light
    • Health
    • Education
    • Recreation and amusement

Significance and Context

• E-commerce Market Growth:
  • Projected to surge from ₹12.2 trillion in 2024 to ₹24.1 trillion by 2028 (source: GlobalData).
• Digital Penetration:
  • 895 million internet connections as of June 2023.
  • Smartphone base expected to cross 1.1 billion by 2025.
• Policy and Data Challenges:
  • MOSPI approached 20 leading e-commerce platforms to share data; response has been minimal.
  • Efforts are ongoing to engage platforms through alternative channels.
• Timeline:
  • Initially, there were plans to integrate e-commerce data into the new CPI series (due February 2026), but lack of data has delayed progress.

A) Why this move matters

• The rise in online purchasing behavior and price variations in digital marketplaces are currently untracked by traditional inflation measures (CPI/WPI).
• The EPI would help capture price dynamics unique to e-commerce, including:
  • Flash sales, online discounts, and promotional pricing patterns.
  • Impact of global supply chains on online product pricing.
  • Price volatility due to dynamic pricing algorithms.

B) Potential challenges

• Data Privacy and Proprietary Constraints: E-commerce firms may be reluctant to share granular pricing data.
• Representativeness Issue: E-commerce consumption patterns differ significantly from traditional retail; ensuring the right weightage across categories will be critical.
• Volatility and Frequency: Unlike traditional retail prices, online prices are dynamic and highly volatile, requiring high-frequency data capture and sophisticated algorithms for smoothing.

C) Strategic Importance

• The index could become a leading inflation indicator for a rapidly growing segment of consumption.
• It will help policymakers gauge the impact of digital economy expansion on consumer prices and overall inflation trends.
• Investors and financial institutions can use the EPI to assess consumer demand resilience and online retail sector health.

Future Outlook

• The National Statistics Office (NSO) plans to launch:
  • A revised CPI series in February 2026.
  • New series for GDP and Index of Industrial Production (IIP).
• If successfully implemented, the EPI could become a foundational tool for monetary and fiscal policy calibration in India’s digital economy.
• Potential to pave the way for creating indices tracking online service pricing in sectors like travel, hospitality, education, and healthcare.

The proposed E-commerce Price Index reflects India’s effort to modernize its inflation tracking mechanisms in line with digital commerce expansion. While data collaboration remains a hurdle, the initiative if executed can offer valuable insights into consumer price movements and support data-driven policymaking for India’s evolving economy.

Agriculture

1. Women in Agribusiness

Context:

Women constitute 64.4 per cent of India’s agricultural workforce but only 6-10 per cent are employed in top agri and agri-related companies, according to a new report released 

Key Highlights

• Women in Agriculture Workforce
  • Women form 64.4% of India’s agricultural workforce.
  • Only 6-10% are employed in top agri and agri-related companies.
• Educational Participation vs. Employment Gap
  • 30-40% of enrolments in agricultural studies are women.
  • However, few of these graduates transition into formal employment structures.

Report Launch & Initiative

• Launched by
  • Godrej Agrovet Ltd
  • Indian Institute of Management Ahmedabad (IIMA)
  • Godrej DEI Lab
• Unveiled during the Second Women in Agriculture Summit.

Company Commitments & Progress

• Balram Singh Yadav, Managing Director, Godrej Agrovet
  • Committed to supporting 100,000 women across the agri value chain.
  • 20,000 women already impacted in the first year.
• Scholarship Initiative
  • Launch of Godrej Agrovet Women in Agriculture Scholarship for five students pursuing agricultural studies.
• Workforce Diversity Goals
  • Increased female representation from 8% to 12% in FY25.
  • Targeting 32% representation by FY28.

Challenges Highlighted

• The paradox of high female participation in agricultural education and informal labor, but low formal employment.
• The report suggests:
  • Equitable access to resources
  • Gender-responsive skill training
  • Inclusive workplace reforms

The report and summit highlight the urgent need to bridge gender disparities in agribusiness. While women play a dominant role in agricultural labor and education, their presence in leadership and formal employment remains minimal. Initiatives like targeted scholarships, inclusive policies, and structured development programs are essential steps toward creating a more equitable, diverse, and empowered agribusiness ecosystem in India.

Mint

2. Current status of GM crops in India

Context:

Right now, Bt cotton is the only genetically modified crop allowed to be grown in the country. GM mustard got conditional approval in 2022, but it hasn’t been rolled out yet because of legal challenges.

Supreme Court developments

• The Supreme Court will begin hearing the GM mustard case from April 15, 2025.
• All sides have been asked to submit their written arguments within a week.
• Earlier, a two-judge bench gave a split verdict on the issue and also asked the Centre to create a national policy for GM crops.

Government and policy efforts

• The Department of Biotechnology (DBT) has been giving technical advice to the Environment Ministry to help frame this policy.
• Science Minister Jitendra Singh said India needs to think ahead and not hold back on biotech progress.
• The government’s BioE3 policy aims to use biotechnology in agriculture, medicine, and industry.

Safety concerns and opposition

• GM mustard was developed using public money, but concerns raised by activist groups over safety and environmental impact have stalled it.

Bio-economy snapshot in India

• According to a DBT report, India’s bio-economy is worth about $165.7 billion.
• Bio-agriculture makes up a small part of this — around $13.5 billion.
• The main drivers in this area are GM crops like Bt cotton and new precision agriculture techniques.

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