Daily Current Affairs (DCA) 3 June, 2025

Daily Current Affairs Quiz
3 June, 2025

National Affairs

1. Union Government Invites Proposals for DDACs in 291 Gap Districts

Context:

The Ministry of Social Justice and Empowerment has invited proposals to establish District De-Addiction Centres (DDACs) in 291 “gap” districts across 30 States and Union Territories. This is part of the National Action Plan for Drug Demand Reduction (NAPDDR).

What Are ‘Gap’ Districts?

• Districts without any existing de-addiction infrastructure supported by the Central government.
• These districts currently lack:
  • Integrated Rehabilitation Centres for Addicts (IRCAs)
  • Community-based Peer Led Initiatives (CPLIs)
  • Outreach and Drop-in Centres (ODICs)

Features of Proposed DDACs

• Will serve multiple functions: treatment, rehabilitation, awareness, and community-based support.
• Must include:
  • Treatment & rehabilitation facilities
  • Drop-in centre area
  • CPLI space
  • Office/admin area
• Capacity: Can house 15 or 30 patients, based on specific government norms.

States with Highest Number of Gap Districts

• Chhattisgarh: 31 of 33 districts
• Bihar: 25
• Madhya Pradesh: 23
• Gujarat: 22
• Arunachal Pradesh: 21
• Uttar Pradesh: 18
• Jharkhand & Punjab: 16 each
• Assam: 10

Who Can Apply?

• Eligible NGOs and start-ups with minimum two years of experience in drug de-addiction services.
• Must submit proposals by June 30, 2025.

Objectives of DDACs

• Conduct awareness programmes for prevention.
• Provide treatment and rehabilitation for substance users.
• Enable community participation through CPLIs.
• Support risk mitigation and early intervention at the district level.

2. Periodic Labour Force Survey (PLFS) 2023-24

Context:

India’s literacy rate has reached 80.9% for individuals aged seven years and above, as reported in the Periodic Labour Force Survey (PLFS) 2023–24. Despite this progress, significant disparities persist across gender and urban-rural lines.

National Overview

• Overall literacy rate (7+ years): 80.9%
• Overall literacy rate (5+ years): 79.7%
• Male literacy (7+ years): 87.2%
• Female literacy (7+ years): 74.6%
• Gender gap (7+ years): 12.6 percentage points
• Source: Periodic Labour Force Survey (PLFS) 2023–24, released by NSSO, Ministry of Statistics and Programme Implementation.

Top 5 States/UTs with Highest Literacy (7+ years)

Rank	State/UT	Literacy Rate (%)
1	Mizoram	98.2
2	Lakshadweep	97.3
3	Kerala	95.3
4	Tripura	93.7
5	Goa	93.6

States with Lowest Literacy Rates (7+ years)

Rank	State	Literacy Rate (%)
1	Bihar	74.3
2	Madhya Pradesh	75.2
3	Rajasthan	75.8

Urban-Rural Literacy Divide

• Urban literacy rate (7+ years): 88.9%
• Rural literacy rate (7+ years): 77.5%
• Significant urban-rural gaps:
  • Madhya Pradesh: Rural 71.6%, Urban 85.7%
  • Bihar: Rural 72.1%, Urban 83.2%
  • Rajasthan: Rural 72.5%, Urban 84.7%

Gender Gap

• Highest gender gaps (7+ years):
  • Rajasthan: 20.1% (M: 85.9%, F: 65.8%)
  • Bihar: 16.2% (M: 82.3%, F: 66.1%)
  • Madhya Pradesh: 16.1% (M: 83.1%, F: 67.0%)
• Rural gender gap examples:
  • Rajasthan: M: 83.6%, F: 61.8%
  • Bihar: M: 81.5%, F: 65.0%
  • MP: M: 80.0%, F: 62.6%
• Best performers in gender parity:
  • Mizoram: M: 99.2%, F: 97.0%
  • Kerala: M: 96.7%, F: 94.0%

Key Observations

• Literacy rates are improving but disparities remain stark across regions, especially:
  • In northern and central states
  • Among tribal and rural populations
  • Between genders
• States with higher educational infrastructure and outreach, such as Kerala and Mizoram, report minimal gaps.

TOI

3. Launch of Bharat Gen: India’s First Indigenously Developed Multimodal AI LLM

Context:

Union Minister Dr. Jitendra Singh launched Bharat Gen, India’s first indigenously developed, multimodal, AI-based Large Language Model (LLM) for Indian languages, at the BharatGen Summit. The initiative is supported by the Department of Science and Technology (DST) under the National Mission on Interdisciplinary Cyber-Physical Systems (NM-ICPS) and implemented by TIH Foundation for IoT & IoE at IIT Bombay.

Main Features of Bharat Gen

• Multimodal LLM: Integrates text, speech, and image modalities
• Languages supported: 22 Indian languages
• Use Cases: AI-powered solutions for healthcare, education, agriculture, and governance
• Ethos: Ethical, inclusive, multilingual AI rooted in Indian values and culture

Key Objectives

• Promote region-specific AI solutions with cultural and linguistic relevance
• Enhance digital inclusion and trust, especially in remote areas (e.g., AI telemedicine in local languages)
• Realize the vision of “India’s Techade” through innovation and inclusion

Institutional Framework

• Executed through 25 Technology Innovation Hubs (TIHs); 4 of them upgraded to Technology Translational Research Parks (TTRPs)
• Supported by a consortium of academic institutions, researchers, and startups

Strategic Pillars of BharatGen Mission

1. Technology Development
2. Entrepreneurship
3. Human Resource Development
4. International Collaboration

Highlights from the BharatGen Summit

• Launch of Generative AI Hackathon 2025 to engage students in solving real-world problems using AI
• MoU exchanges among government departments and research organizations to strengthen collaboration

Relevance to Broader Policy Landscape:

• Aligns with NEP 2020 promoting interdisciplinary and multilingual education
• Supports CPGRAMS modernization via multilingual AI-driven grievance redressal
• Complements PM-led initiatives like PM MUDRA Yojana, PM SVANidhi, and PM Vishwakarma Yojana

PIB

Banking/Finance

1. Digital Rupee (e₹)

Context:

The digital rupee (e₹), launched as a pilot in late 2022 by the Reserve Bank of India (RBI), has witnessed significant scale-up in just two years. Retail transaction value rose from ₹5.7 crore in March 2023 to ₹1,016.5 crore in March 2025 — a 178x increase. This marks the transition of e₹ from an experimental phase to meaningful retail adoption.

Use-Case Evolution

• Wholesale adoption remains limited, but the retail use-case is expanding rapidly.
• Use of e₹ is supporting India’s core digital goals:
  • Modernizing payment infrastructure
  • Reducing reliance on physical cash
  • Offering a regulated digital alternative to private cryptocurrencies

Strategic Implications

• Rising usage of e₹ reflects growing consumer and merchant trust.
• Focus on large-value transactions signals integration into mainstream financial behavior.
• Demonstrates potential for RBI to reshape currency usage without disrupting existing systems like UPI or NEFT.

Outlook & Policy Relevance

• The success of the digital rupee aligns with:
  • India’s financial inclusion roadmap
  • Global CBDC (Central Bank Digital Currency) developments
  • Need for regulated, traceable digital money in contrast to volatile cryptocurrencies

2. NSE’s IPO Plans Face Regulatory Hurdles

Context:

The National Stock Exchange (NSE) has been trying to launch its Initial Public Offering (IPO) since 2016, but the process has faced repeated regulatory and legal delays. With a new SEBI Chairperson in place, the NSE is pushing for progress, but multiple concerns from Securities and Exchange Board of India (SEBI) remain unresolved.

Key Regulatory Hurdles

• Co-location Case:
  • Originates from a 2015 whistleblower complaint alleging preferential access to select brokers via secondary servers.
  • SEBI concluded this enabled some brokers to execute trades faster, creating unfair advantage.
  • SEBI’s orders (2019) against NSE and others are under Supreme Court appeal; the CBI investigation is still ongoing.
• Technology Infrastructure:
  • SEBI flagged frequent technical glitches at NSE and inadequate response systems.
• Governance Issues:
  • Unequal compensation between NSE’s Managing Director and other Key Managerial Personnel (KMP).
  • Absence of a permanent board chairperson—public interest directors currently rotate the chair.
  • Concerns over NSE’s clearing corporation ownership, with SEBI emphasizing independent operation of clearing corporations.

Rationale for Listing

• NSE seeks listing to enhance valuation and address pressure from private equity investors.
• Several investors have exited or shifted holdings due to the lifecycle end of funds.
• NSE shares are actively traded in the unlisted market, with over 1 lakh shareholders.

Potential Listing Platform

• NSE cannot list on its own platform as per SEBI rules to avoid conflict of interest.
• Therefore, the Bombay Stock Exchange (BSE) is the likely listing venue.

NSE’s Response to SEBI Concerns

• NSE has proposed to settle pending cases with SEBI and the courts by paying a fine.
• It has committed to:
  • Disclose clearing corporation risks in its IPO draft.
  • Align KMP compensation with SEBI norms.
  • Rectify tech infrastructure weaknesses as per future regulatory guidance.

TET

3. Fintech Concern Under RBI’s New DLG Guidelines

Context:

The Reserve Bank of India (RBI) has mandated that regulated entities (REs) make full provisioning for loans sourced via Loan Service Providers (LSPs), regardless of Default Loss Guarantees (DLGs) offered. RBI has prohibited offsetting DLGs against provisioning requirements for stressed loans.

• Deadline for compliance: September 30, 2025.

Industry Reaction: Risk of Double Provisioning

• Fintech bodies are collecting industry data to present concerns to RBI about double provisioning, which they argue is:
  • Capital-inefficient.
  • Likely to discourage loan origination through LSPs.

DLG Framework Under RBI Norms

• DLG = A contractual guarantee by the LSP to compensate lenders for defaults up to 5% of a loan portfolio.
• Key RBI stipulations:
  • DLG cover on an outstanding portfolio must not exceed 5% of total disbursed amount.
  • Even if DLG exists, provisioning remains solely the RE’s responsibility under existing norms.

Additional Regulatory Requirements for Digital Lenders

• Digital lending platforms must now:
  • Offer multiple loan options to borrowers.
  • Ensure borrowers can make informed choices through transparent digital marketplaces.
• Fintechs claim this may disrupt customer experience and conversion rates.

Way Forward: Industry-RBI Consultative Process

• Fintech bodies intend to:
  • Submit impact data to RBI before the provisioning deadline.
  • Request reconsideration of the provisioning treatment of DLG-covered loans.
• RBI has signaled openness to engagement, but maintains that risk provisioning must rest with REs.

Implications for Digital Lending Ecosystem

• Possible slowdown in loan origination through LSPs.
• Reduced portfolio attractiveness for NBFCs and digital lenders.
• Increased capital requirements, affecting small fintech players more severely.

BS

4. RBI’s Pro-Growth Policy Stance

Context:

RBI has implemented back-to-back rate cuts since February 2025, reducing policy rates by 50 basis points (bps). Effective easing is ~75 bps, as overnight rates are closer to the Standing Deposit Facility (SDF), the lower end of the policy corridor.

Aggressive Liquidity Infusion

• RBI infused ₹5.23 trillion into the system via government bond purchases (OMOs) between December 2024 and May 2025.
• The speed of infusion outpaced RBI’s response during the COVID-19 crisis, where a similar liquidity infusion took a full year.

Macroprudential Easing

• Regulatory relaxations include:
  • Eased bank lending norms to NBFCs.
  • Deferred implementation of Liquidity Coverage Ratio (LCR) requirements for digital retail deposits.

Inflation Dynamics Supporting Easing

• Headline CPI inflation has stayed below 4% since February 2025.
• Food inflation has eased substantially:
  • Only 14% of CPI food items are showing >6% inflation, down from 57% a year ago.
• Core inflation remains subdued, reflecting a negative output gap and weak demand-side pressures.

External Environment Favorable for Easing

• The “impossible trinity” challenge (strong dollar, capital outflows, domestic easing) has eased.
• Rupee depreciation pressures have abated amid weakening dollar and concerns over US fiscal stability.
• This offers policy space for RBI to focus on domestic growth.

BS

5. Tri-Party Repo Dealing System (TREPS)

Context:

Banks are borrowing funds from the Tri-Party Repo (TREPS) market at lower rates and parking them in the RBI’s Standing Deposit Facility (SDF) to earn risk-free arbitrage. The weighted average TREPS rate was 5.66%, while the SDF rate stood at 5.75%, offering a 9 basis points spread.

Tri-Party Repo Dealing System (TREPS)

Definition and Functionality

• Full form: Tri-Party Repo Dealing System (TREPS)
• TREPS is a type of repo (repurchase agreement) involving a third-party agent (Tri-Party Agent) who facilitates:
  • Collateral selection
  • Settlement and payment services
  • Custody and lifecycle management
• In TREPS, securities are sold with an agreement to repurchase at a later date at a predetermined price (including interest).

Key Features

• Short-term arrangement: Overnight to a few weeks
• Central Counterparty: Clearing Corporation of India Ltd. (CCIL), which also acts as the Tri-Party Agent

Why Mutual Funds Use TREPS?

1. Liquidity Management:
   • Ideal for deploying idle cash in the short term
   • Offers quick liquidity with minimal risk
2. Portfolio Diversification:
   • Provides a low-risk fixed-income component
   • Helps balance the fund’s risk-return profile
3. Regulatory Compliance:
   • TREPS investments support SEBI-mandated asset allocation norms
   • Aid in tracking and limiting exposure across asset classes

BS

6. Grameen Credit Score (GCS)

Context:

The Grameen Credit Score (GCS) is a new initiative announced in the Union Budget 2025–26 by Finance Minister Nirmala Sitharaman. It aims to strengthen rural financial inclusion, with a special focus on self-help group (SHG) members. The Union government expects to roll out GCS within the next three months, pending final approval from the Reserve Bank of India (RBI).

Purpose and Utility

• The GCS will act as a supplementary credit assessment tool, specifically tailored to rural borrowers.
• It seeks to fill the gap left by existing credit bureaus like CRIF Highmark and CIBIL, whose scoring models are generic and not designed for rural lending profiles.
• Banks, NBFCs, and microfinance institutions will be able to better evaluate creditworthiness of borrowers in underbanked areas.

Institutional Framework

• A dedicated committee has been constituted to design and implement the GCS framework.
• The Ministry of Rural Development and other stakeholders are currently working out operational modalities in consultation with the RBI.

Linkage with SVAMITVA Scheme

• The rollout of GCS is aligned with the SVAMITVA scheme, which provides legal ownership records of residential properties in villages using drone-based mapping.
• As per PM Narendra Modi, the scheme has the potential to unlock over ₹100 trillion in economic activity.
• Property cards issued under SVAMITVA enable rural residents to access formal credit from banks, making GCS highly relevant for enhancing credit penetration.

Current Status and Economic Potential

• Over 6 lakh villages are covered under SVAMITVA; nearly half have already been surveyed.
• Lakhs of rural residents have availed bank loans using their property cards as collateral.
• GCS will further formalize credit assessment and is expected to boost rural lending and reduce dependency on informal sources.

Significance for Rural Credit Ecosystem

• Focus areas:
  • Members of Self-Help Groups (SHGs)
  • Rural borrowers with limited or no traditional credit histories
• Expected outcomes:
  • Improved access to credit
  • Reduced credit risk for lenders
  • More inclusive growth in rural India

BS

7. NITI Aayog Highlights Missing Middle in MSME Policy

Context:

Medium enterprises form only 0.3% of India’s MSMEs but contribute an outsized 40% of MSME export income. They operate in innovation-driven and globally integrated sectors like pharmaceuticals, auto components, and IT services. Despite their economic importance, they receive limited policy attention, as most schemes are targeted at micro and small enterprises (MSEs), which make up 99% of the MSME base.

Economic Contribution and Characteristics

• Average foreign exchange income per medium enterprise: ₹39 crore.
• Average employment per firm: 90 people.
• Average annual R&D expenditure: ₹2.07 crore.
• Medium enterprises often drive R&D and technology adoption, participating in global value chains.

Policy Asymmetry and Its Consequences

• Current MSME policy structure incentivizes firms to stay small and informal.
• This leads to:
  • Disincentivized scaling up
  • Reduced productivity
  • Missed opportunities in innovation and export competitiveness

NITI Aayog Recommendations: A Multi-Pronged Policy Approach

a. Financial Support

• Launch a credit card facility with ₹5 crore pre-approved limit.
• Introduce a dedicated working capital support scheme tailored to medium firms’ higher capital needs.
• Expand access to concessionary finance, currently available mostly to micro and small units.

b. Innovation and Technology

• Transform existing Technology Centres into SME Competence Centres focusing on Industry 4.0.
• Provide medium enterprises access to:
  • Advanced technologies
  • Skill development programs
  • Technology consultancy services

c. R&D and Cluster-Based Innovation

• Establish a dedicated R&D cell under the Ministry of MSME, inspired by EU funding models.
• Identify cluster-specific innovation needs and invite R&D proposals from medium enterprises.
• Extend the Cluster Development Programme to include medium enterprises for:
  • Product testing
  • Quality certification
  • Regulatory compliance support

d. Digital Access and Awareness

• Develop a centralized digital portal for medium enterprises to:
  • Access government schemes
  • Track compliance requirements
  • Access sectoral market research
• Address the persistent lack of awareness that hampers scheme utilization among medium enterprises.

5. Strategic Significance

• Medium enterprises are crucial to:
  • India’s export growth
  • Manufacturing competitiveness
  • Technological innovation
• Without focused policy support, India’s Make in India goals and export expansion plans may fall short.

BS

8. Indian Rupee Asia’s Worst Performer

Context:

The Indian rupee is Asia’s worst-performing currency this quarter. While other emerging Asian currencies gained ground, the rupee remained broadly flat. The underperformance is linked to the Reserve Bank of India’s FX reserve management strategy.

RBI’s Forward Dollar Commitments & FX Reserve Focus

• RBI’s net short forward dollar position (future dollar sales):
  • $73 billion as of April 2025
  • Down from $88.8 billion in February (record high)
• The RBI is letting forward contracts run off while buying spot dollars to rebuild reserves.
• This demand for USD may depress the rupee further in coming months.

Market and Macro Context

• On June 2, the rupee was trading at ₹85.40/USD, up 0.2% following a strong Q4 GDP growth of 7.4%.
• Despite macro strength, foreign portfolio outflows and RBI’s intervention strategy are weighing on the currency.

India’s FX Reserve Status

• As of May 23, 2025, FX reserves stood at $693 billion, slightly below the all-time high of $705 billion (Sept 2024).
• RBI’s short-term dollar forward exposures:
  • Up to 3 months: $15 billion
  • 3 months to 1 year: $37.8 billion

Policy Outlook and RBI Strategy

• RBI aims to rebalance reserves while avoiding over-reliance on the forward market.
• The central bank prefers spot market purchases to maintain a strong buffer against global shocks and geopolitical risks.
• RBI Governor Sanjay Malhotra has allowed more market-driven currency movements, but retains active FX management.

Mint

9. RBI Launches Climate Risk Information System (RBI-CRIS)

Context:

The Reserve Bank of India (RBI) has launched a dedicated climate risk data platform, RBI-CRIS, aimed at equipping financial institutions with critical tools and information to address risks arising from climate change.

Key Highlights:

• Platform Name: RBI–Climate Risk Information System (RBI-CRIS)
• Objective:
  • To address climate-related financial risks.
  • To support regulated entities in integrating climate risk into decision-making and risk management frameworks.
• Platform Components:
  1. Public Directory:
     • A freely accessible web-based directory.
     • Lists geospatial and meteorological data sources relevant for climate risk assessment.
  2. Restricted Data Portal:
     • Available only to regulated entities.
     • Offers processed, standardized datasets to support climate risk modelling and mitigation.
• Significance:
  • Bridges existing data gaps on climate vulnerability and exposure.
  • Enables banks, NBFCs, and financial institutions to conduct robust climate scenario analysis.
  • Aligns with global central banking efforts to assess financial stability risks linked to environmental factors.
• Regulatory Implication:
  • Reinforces RBI’s focus on sustainable finance and risk-based supervision.
  • Encourages integration of climate considerations in credit appraisal, portfolio management, and capital adequacy planning.

10. RBI Imposes ₹54.78 Crore in Penalties on 353 Regulated Entities

Source: Reserve Bank of India

Context:

To uphold regulatory discipline and enhance financial sector integrity, the Reserve Bank of India (RBI) imposed monetary penalties on various regulated entities (REs) for violations of key supervisory norms during FY25.

Key Highlights:

• Total Penalties:
  • ₹54.78 crore imposed through 353 enforcement actions.
• Primary Areas of Violation:
  • Cybersecurity framework lapses
  • Breach of Exposure norms and IRAC (Income Recognition and Asset Classification) guidelines
  • Non-compliance with Know Your Customer (KYC) norms
  • Inaccurate classification/reporting of frauds
  • Non-reporting to CRILC (Central Repository of Information on Large Credits)
  • Delay/Failure in credit data submission to Credit Information Companies (CICs)
• Breakup by Entity Type:
  • 264 Cooperative Banks: ₹15.63 crore
  • 37 NBFCs/ARCs: ₹7.29 crore
  • 13 Housing Finance Companies (HFCs): ₹0.83 crore
  • 8 Public Sector Banks: ₹11.11 crore
  • 15 Private Sector Banks: ₹14.8 crore
  • 6 Foreign Banks: Penalized (amount not specified)

Objective of Enforcement:

• Promote robust compliance culture
• Ensure adherence to RBI’s regulatory framework
• Strengthen sector-wide financial governance and operational discipline

11. RBI to Launch Indigenous ‘IFS Cloud’

Source: Reserve Bank of India

Context:

The Reserve Bank of India (RBI) has announced a strategic initiative to enhance digital resilience and reduce dependence on global technology infrastructure by rolling out a sovereign cloud solution tailored for the Indian financial sector.

Key Highlights

Indian Financial Services (IFS) Cloud Launch

• Timeline: FY 2025–26
• Developed by: Indian Financial Technology & Allied Services (IFTAS), an RBI subsidiary
• Purpose:
  • Promote data localisation
  • Reduce reliance on foreign cloud service providers
  • Provide cost-effective cloud solutions for small banks and NBFCs
• Ownership: Initially RBI-owned; to be transferred to a financial sector consortium in the future
• Type: Community cloud for RBI and its regulated entities

e-Kuber Upgrade (RBI’s Core Banking System)

• Enhancements Planned:
  • New modules for government auctions, public debt management, and financial literacy
  • Cloud-native and API-first redesign
• Objective: To handle growing digital volumes and improve scalability
• Coverage: Already serves 250+ commercial banks and state governments

Cybersecurity & Digital Trust Measures

• New Internet Domains:
  • Launch of ‘.bank.in’ and ‘.fin.in’ domains
  • Managed by IDRBT (Institute for Development and Research in Banking Technology)
  • Objective: Reduce phishing risks and enhance trust in digital banking platforms

AI Governance Framework

• Focus Areas:
  • Regulate use of AI/ML by RBI staff and partners
  • Emphasize data protection, algorithmic transparency, and operational integrity

Strategic Importance

• Aligns with India’s sovereign digital infrastructure goals
• Supports the financial inclusion of smaller institutions
• Strengthens cyber resilience and consumer trust in digital platforms

Economy

1. India’s FDI Trends in FY25

Contrasting Narratives from RBI Bulletin

• Gross FDI inflows: Reported at $81 billion – hailed by government/media as a record high.
• Net FDI: Just $353 million, a steep fall, indicating increased disinvestment and outward FDI.
• Highlights discrepancy between headline numbers and underlying trends.

FDI-to-GDP and GFCF Ratios (Declining Trend)

• Gross FDI-to-GDP ratio: Dropped from 3.1% (FY21) to 2.1% (FY25).
• Net FDI-to-GDP: Declined from 1.6% to 0% over the same period.

Rise in Outward FDI (OFDI) & Disinvestment

• Outward FDI includes investment by Indian firms abroad for:
  • Technology acquisition
  • Market expansion
  • Tax arbitrage via havens like Mauritius and Singapore
• Disinvestment refers to exit of foreign capital, especially during stock market booms.

PE/VC Dominance in FDI Composition

• Private Equity (PE) and Venture Capital (VC) now constitute over 75.9% of FDI (2020-21).
• Mostly brownfield FDI, focused on:
  • Fintech
  • Real estate
  • Healthcare
  • Retail
  • Insurance
• Investments are short-term, exit-oriented, and loosely regulated.
• Examples:
  • Blackstone in Care Hospitals
  • ChrysCapital in Lenskart

Concerns from Global Research Findings

• Blanchard & Acalin (2016): India ranks 6th among 25 EMEs in correlated inward-outward FDI.
• Suggests India is a conduit for hot money and treaty shopping.
• FDI flows may reflect tax optimisation, not real investment in productive assets.

Structural & Policy Implications

• Decline in greenfield FDI → Less contribution to new capacity, tech absorption.
• Rising disinvestment and OFDI → Indicates limited domestic investment appeal.
• FDI’s role in gross capital formation is modest and shrinking.
• Need to reform foreign capital regulations to:
  • Prioritise tech-intensive, long-term investments
  • Minimise tax-arbitrage-led flows
  • Align FDI with domestic industrial policy goals

TH

Agriculture

1. ESG-Driven Architecture in Agri-Food

Introduction

Across industries, sustainability is evolving from an aspiration to a necessity. In the agri-food value chain, where environmental and social stakes are high, ESG (Environmental, Social, and Governance) architecture emerges as the framework that transforms intent into impact. This article unpacks how agri-food businesses can embed ESG principles into operations using a structured architectural approach.

Key ESG Challenges in Agri-Food Value Chains

Agri-food systems are particularly exposed to ESG risks due to their complexity and scale:

• Water Scarcity: Agriculture consumes nearly 70% of global freshwater.
• Deforestation: Land clearing for crops and livestock is a key driver.
• Soil Degradation: Threatens future productivity and food security.
• Labor Rights: Especially among seasonal and migrant workers.
• Food Waste: Affects both environmental and financial performance.
• Supply Chain Emissions: Difficult to track and verify across actors.

What is ESG-Driven Architecture?

ESG-driven architecture is a blueprint that integrates sustainability and governance into core business systems. It includes:

• Data & Analytics Layers: Real-time monitoring of emissions (Scope 1, 2, 3), labor practices, and biodiversity.
• Technology Foundations: IoT sensors, precision farming tools, blockchain for traceability.
• Governance Mechanisms: Embedding ESG into procurement, supplier audits, and reporting workflows.

This structured architecture turns “good intentions” into accountable, measurable results.

Adopting ESG Architecture: Step-by-Step Guide

1. Technology Integration
   • Deploy smart agri-tech tools (e.g., soil health sensors, water optimization).
   • Use ESG analytics platforms for integrated sustainability data.
2. Sustainable-by-Design Framework
   • Design modular, scalable systems with built-in environmental impact considerations.
   • Cut long-term costs and reduce emissions at the development stage.
3. Consolidated ESG Data Systems
   • Combine environmental, social, and governance data across departments.
   • Use real-time dashboards for compliance, performance, and strategy alignment.
4. Investment Alignment
   • Leverage green finance, ESG-linked bonds, and impact investments.
   • Ensure transparent, auditable ESG disclosures to attract capital.
5. Stakeholder Engagement
   • Farmers & Suppliers: Offer tools, training, and incentives for sustainable practices.
   • Consumers: Communicate sourcing, certifications, and eco-claims.
   • Regulators: Maintain proactive engagement on reporting and compliance.

Why ESG Architecture Pays Off

• Risk Mitigation: Reduces exposure to climate disruptions and resource scarcity.
• Capital Access: Attracts ESG-focused investors with credible metrics.
• Brand Differentiation: Enhances trust and loyalty in conscious consumer segments.
• Operational Efficiency: Lowers resource and energy usage, reducing costs.

BL

Science & Tech

1. SHUKR Gene and Flowering Plant Evolution

Background

• Life on Earth depends heavily on plants, particularly for oxygen production and food supply.
• About 130 million years ago, flowering plants diversified rapidly, a phenomenon Charles Darwin called an “abominable mystery.”
• Recent research by CSIR-Centre for Cellular and Molecular Biology (CCMB), Hyderabad uncovers a genetic mechanism that may explain this.

Plant Life Cycle Basics

• Plants alternate between two phases:
  • Gametophyte (haploid): produces gametes (sperm/egg)
  • Sporophyte (diploid): produces spores, the dominant phase in flowering plants
• In mosses, the gametophyte phase dominates, and sperm swim in water to fertilize eggs.
• In flowering plants, the sporophyte dominates. Gametophytes are smaller, enclosed, and depend on the sporophyte for development.

Major Finding

• SHUKR gene, newly identified in the sporophyte of Arabidopsis thaliana, plays a critical role in pollen (male gametophyte) development.
• The gene controls a class of F-box genes responsible for removing old proteins and facilitating new protein formation in pollen cells.
• Loss of SHUKR function leads to non-viable pollen, confirming its essential role in reproduction.

Significance of SHUKR

• SHUKR is specific to eudicots, a group that includes 75% of flowering plants.
• Emerged about 125 million years ago, aligning with the rapid rise of flowering plant diversity.
• Both SHUKR and its downstream F-box genes are rapidly evolving, enabling pollen to adapt to varying climatic conditions.

Evolutionary

• Unlike mosses, flowering plants reproduce in diverse, often harsh, conditions (e.g., heat, aridity).
• SHUKR’s evolution may have allowed environmentally tailored pollen development, offering a molecular explanation for Darwin’s mystery.
• It highlights a shift from gametophyte-independent to sporophyte-controlled reproduction in flowering plants.

Relevance to Food Security

• Flowering plants, especially eudicots, form the bulk of global food crops (cereals, pulses, oilseeds).
• Climate change-induced male sterility threatens yields due to stress on pollen development.
• SHUKR could be key to developing climate-resilient crops by manipulating sporophyte-controlled pollen responses.

Future Applications

• Using preconditioned pollen to improve plant adaptation to specific environments.
• Enhancing research into stress-tolerant traits through SHUKR and associated gene networks.

Facts To Remember

1. First victory for Gukesh in a classical game against World No. 1 Carlsen

World champion D. Gukesh got his revenge on Magnus Carlsen as he pounced on a blunder by the World No. 1 to defeat him for the first time in a classical game, leaving the Norwegian superstar so frustrated that he banged his fist on the board after the sixth round of Norway Chess tournament.

2. ₹ 2,000 notes worth ₹ 6,181 crore still in circulation: RBI

The highvalue ₹ 2,000 notes worth ₹ 6,181 crore are still in circulation after two years of the Reserve Bank of India withdrawing the currency, according to data released. On May 19, 2023, the RBI had announced the withdrawal of the ₹ 2,000 denomination banknotes from circulation.

3. UCO Bank appoints Sumit Khandelwal as CFO

State-run UCO Bank has appointed Sumit Khandelwal as its new chief financial officer (CFO) with immediate effect, according to a regulatory filing. Khandelwal, who previously served as the general manager and the zonal head of the bank’s New Delhi zone, replaces Sujoy Dutta as CFO.

4. Canara Bank waives minimum balance requirement for all savings accounts

Canara Bank has announced the complete waiver of the Average Monthly Balance (AMB) requirement across all savings bank (SB) account types, which includes savings accounts, salary accounts and NRI SB Accounts.

5. India reaffirms commitment to inclusive digital growth at BRICS meet

India reaffirmed its commitment to inclusive, sustainable, and future-ready digital development during the 11th BRICS Communications Ministers’ Meeting held in Brasília, Brazil.

6. PM Modi invites world’s leading aviation companies to invest in India as country emerges 3rd largest domestic aviation market

Prime Minister Narendra Modi has invited the world’s leading aviation companies to invest in India, saying India has emerged as the world’s third-largest domestic aviation market.