Daily Current Affairs (DCA) 31 May, 2025

Daily Current Affairs Quiz
31 May, 2025

International Affairs

1. Catastrophic Glacier Collapse: Climate Change

Context:

A colossal glacier collapse in the Swiss Alps has wrought severe destruction on the village of Blatten, burying nearly 90% of the settlement under a thick mudslide. Triggered by the sudden disintegration of a massive portion of the Birch Glacier, the landslide blocked the Lonza River and has left one man missing as rescue operations continue. The event highlights the escalating threat posed by glacier retreat in Alpine regions, driven largely by climate change.

What is Glacier Meltdown?

Glacier meltdown, also known as glacial retreat, occurs when glaciers lose ice faster than they accumulate new snow and ice. This leads to shrinking ice cover and the formation of glacial lakes. Glacier meltdown is a significant indicator of global climate change, impacting water resources, ecosystems, and increasing disaster risks.

Reasons Behind Glacier Meltdown

• Rising Global Temperatures: The eastern Himalayas are warming at a rate faster than the global average, approximately 0.1°–0.8°C per decade, accelerating ice melt.
• Increased Carbon Emissions: Enhanced greenhouse gases cause atmospheric warming, speeding up glacier melting.
• Changing Precipitation Patterns: More rainfall instead of snowfall disrupts the natural accumulation of glacier ice.
• Anthropogenic Activities: Human activities like deforestation, infrastructure development, and tourism contribute to local warming around glaciers.
• Black Carbon Deposits: Soot and particles from fossil fuel burning reduce glacier reflectivity (albedo), causing greater heat absorption and faster melting.

Impacts of Glacier Meltdown

• Glacial Lake Outburst Floods (GLOFs): Melting glaciers form lakes whose rising water levels can trigger catastrophic floods downstream.
• Disruption of River Systems: Rivers fed by glaciers such as the Teesta and Brahmaputra face irregular and unpredictable flows, impacting agriculture and hydroelectric power generation.
• Threat to Biodiversity and Ecosystems: Reduced glaciers affect plant and animal species dependent on glacier-fed water sources, disturbing ecosystems.
• Water Scarcity and Food Security: Decreased availability of glacier meltwater threatens irrigation, drinking water supplies, and overall food production.

Climate Change and Glacier

• Switzerland, home to Europe’s largest glacier reserves, is witnessing accelerating glacier loss due to rising temperatures.
• In 2023, the country experienced a 4% reduction in glacier volume, marking the second-largest annual decline after a 6% loss in 2022.
• The retreat of glaciers destabilizes mountain slopes, increasing the risk of landslides, floods, and other natural disasters.

TH

National Affairs

1. Government Eases Rules Under Advance Authorisation (AA) Scheme for Exporters

Context:

The government has relaxed norms under the Advance Authorisation (AA) Scheme to benefit exporters. Exporters can now claim duty-free benefits even if goods were shipped before licence issuance, provided the Bill of Entry is filed after the licence date.

About the Advance Authorisation Scheme

• Purpose: Allows duty-free import of inputs used in manufacturing export products to reduce input costs and enhance the competitiveness of Indian exports globally.
• Administered by: Directorate General of Foreign Trade (DGFT), Ministry of Commerce and Industry.

Key Features

• Duty-Free Import: Raw materials, packaging materials, fuel, oil, and catalysts can be imported without customs duty.
• Standard Input-Output Norms (SION): Sector-specific norms guide the permissible input quantities; ad-hoc norms can be applied if SIONs do not exist.
• Eligibility: Manufacturer exporters and merchant exporters linked with supporting manufacturers.
• Physical Incorporation Principle: Inputs must be physically used or consumed in the final export product.

Recent Relaxation in Rules

• Previous Norm: Duty exemption was denied if goods were shipped before the AA licence was issued, even if the Bill of Entry was filed later.
• New Norm: Exporters can claim duty-free benefits if the Bill of Entry is filed after licence issuance, regardless of shipment date.
• Restriction: This relaxation does not apply to restricted or canalised goods unless special approval from DGFT is obtained.

Impact

• Resolves ambiguity around shipment and licence dates.
• Streamlines Customs clearance processes for exporters.
• Enhances exporter confidence amid logistical challenges and delays.

2. Launch of Swachh Survekshan Grameen (SSG) 2025

Context:

Union Minister of Jal Shakti Shri C R Patil launched Swachh Survekshan Grameen (SSG) 2025, a nationwide rural sanitation survey by the Department of Drinking Water and Sanitation (DDWS), Ministry of Jal Shakti today in Delhi in the presence of Minister of State of Jal Shakti  Shri V. Somanna.

• Scope: Survey covers 21,000 villages across 761 districts in 34 States/UTs.
• Purpose: To assess rural sanitation progress and sustainability of ODF Plus outcomes under Swachh Bharat Mission (Gramin) Phase-II.

Ministry

• Conducted by: Department of Drinking Water and Sanitation (DDWS), Ministry of Jal Shakti.
• Verification: Independent agency engaged for authentic and transparent field verification.

Survey Criteria and Components

SSG 2025 evaluates rural sanitation through four main components:

• Service-Level Progress (SLP):
  • District self-assessment and desktop validation of ODF Plus Model Verified Villages.
• Direct Observation of Sanitation Status:
  • Field visits to households, schools, Common Service Centres (CSCs), Panchayat Bhavans to verify cleanliness and sanitation practices.
• Direct Observation – Infrastructure Functionality:
  • Evaluation of Plastic Waste Management Units (PWMU), Faecal Sludge Management (FSM) plants, GOBARdhan units, etc.
• Citizen Feedback:
  • Collected through mobile apps and face-to-face surveys to ensure inclusive participation and transparency.

3. PadhAI Conclave on AI in Education

Context:

Union Minister for Education, Shri Dharmendra Pradhan, delivered the valedictory address at the concluding session of ‘PadhAI: Conclave on AI in Education’, organised by the Center of Policy Research and Governance (CPRG), in New Delhi.

Key Highlights from Shri Dharmendra Pradhan’s Address:

• AI as a Force Multiplier:
  • AI is not merely technology but a catalyst for innovation, bridging empathy with technology.
• India’s AI Leadership:
  • Emphasized the need for India’s human intelligence to lead the ongoing AI revolution.
• Government Initiatives on AI:
  • Establishment of Centre of Excellence in AI.
  • Promoting AI integration in Indian languages.
  • Encouraging critical thinking in classrooms.
  • Transitioning education from traditional chalkboards to digital chipsets.
• AI in School Education:
  • Integration of AI in education is no longer optional but essential.
• Call to Action:
  • Urged academicians and technology experts to collaborate and provide policy recommendations on AI in education.

About the PadhAI Conclave

• Duration: Two-day event
• Focus: Exploring the role of AI in transforming Indian education
• Themes Discussed:
  • Expanding learning beyond classrooms
  • AI’s role in higher education transformation
  • Challenges and bottlenecks in existing educational institutions

4. Union Minister Launches Ayush Suraksha Portal

Context:

In a historic move to boost consumer safety and regulatory governance in India’s traditional medicine sector, Shri Prataprao Jadhav, Union Minister of State (Independent Charge) for Ayush and Minister of State for Health & Family Welfare, launched the Ayush Suraksha Portal at Ayush Bhawan, New Delhi. The launch aligns with the Supreme Court’s directive to establish a centralized mechanism for monitoring misleading advertisements and adverse drug reactions (ADRs) in Ayush systems.

Key Objectives of the Ayush Suraksha Portal

• Serve as a centralized digital platform to report and monitor misleading Ayush advertisements and ADRs
• Ensure real-time tracking, status updates, and regulatory action by State and Central authorities
• Empower citizens, professionals, and regulators through an integrated surveillance ecosystem
• Promote evidence-based practices and enhance transparency in Ayush product monitoring

Supreme Court Directive

• The portal was launched in compliance with SC Order dated July 30, 2024, in Writ Petition (Civil) No. 645/2022
• The Court mandated the creation of a central dashboard for reporting and inter-agency coordination by June 2025

Key Functional Features

• Public Access: Citizens can directly report misleading ads and ADRs
• Real-Time Updates: Status tracking and case monitoring by officials and public
• Inter-State Coordination: Facilitates referrals and action sharing among SLAs
• Transparent Governance: Public dashboard ensures accountability and visibility of actions taken

Significance

• Reinforces the Ministry of Ayush’s commitment to safe, credible, and quality-assured traditional medicine
• Enhances regulatory efficiency, ensures public health safety, and deters unethical marketing practices
• Supports the vision of Digital India and responsible governance in healthcare

5. India-Chile Comprehensive Economic Partnership Agreement (CEPA)

Context:

On 8 May 2025, India and Chile signed the Terms of Reference (ToR) for negotiating a Comprehensive Economic Partnership Agreement (CEPA). The first round of negotiations began on 26 May 2025 in New Delhi. Commitment reaffirmed during the State Visit of Chilean President Gabriel Boric Font to India in April 2025.

Objectives and Vision

• To foster deeper economic integration and strengthen global value chains between the two countries.
• To develop a balanced, ambitious, and mutually beneficial CEPA.
• To enhance bilateral trade diversification, investment promotion, and employment generation.

Key Highlights of the First Round

• Indian delegation led by Shri Vimal Anand, Joint Secretary, Department of Commerce.
• Chilean team headed by Mr. Pablo Urria, Director for Asia & Oceanic, Chile’s Ministry of Foreign Affairs.
• Negotiations covered 17 thematic tracks, including:
  • Trade in Goods & Services
  • Movement of Natural Persons
  • Rules of Origin (RoO)
  • Sanitary & Phytosanitary Measures (SPS)
  • Technical Barriers to Trade (TBT)
  • Customs, Transparency, Dispute Settlement
  • Economic Cooperation, MSMEs, Women’s Empowerment
  • Sustainable Development, Strategic Minerals Trade
  • Intellectual Property Rights (IPR), Investment Cooperation

6. India Launches DHRUVA Policy for Digital Addressing System

Key Highlights

• The Department of Posts is implementing a national geo-coded addressing system to modernize public and private service delivery in India.
• The initiative includes two key milestones:
  • DIGIPIN (Digital Postal Index Number): A standardized, public-domain National Addressing Grid.
  • DHRUVA (Digital Hub for Reference and Unique Virtual Address): A comprehensive Digital Address Public Infrastructure (DPI) policy framework.

What is DIGIPIN?

• DIGIPIN is a geo-coded address identifier that enables:
  • Logical naming of locations with directional and spatial coherence
  • Public and private service efficiency
  • Improved emergency response and logistics

What is DHRUVA?

• DHRUVA outlines the Digital Address DPI policy built on:
  • Standardization, interoperability, and geocoding of address data
  • Address-as-a-Service (AaaS) to manage and share address data securely
  • User autonomy and consent-based data sharing
  • Robust digital foundations for governance, e-commerce, logistics, and financial services

Policy Objectives

• Establish address data as foundational public infrastructure
• Enhance service delivery and citizen experience
• Promote collaboration between public and private stakeholders
• Encourage broad adoption by ministries, state governments, and businesses
• Enable innovation through secure, user-centric digital solutions

7. Indian Navy’s Anti-Submarine Warfare Capabilities Strengthened

Context:

On 29 May 2025, the keel laying ceremony for the 8th and final Anti-Submarine Warfare Shallow Water Craft (ASW SWC), designated BY 530, was held at Cochin Shipyard Limited (CSL), Kochi. Ceremony attended by Vice Admiral Rajaram Swaminathan (CWP&A) and senior officials from the Indian Navy and CSL.

Project Highlights

• The vessel is part of the ‘Mahe’ class of ASW SWCs.
• Contract for 8 ships awarded to CSL on 30 April 2019 by the Ministry of Defence.
• All ships are in advanced stages of production.

Strategic and Indigenous Importance

• Vessels have over 80% indigenous content, supporting Aatmanirbhar Bharat and Make in India initiatives.
• Equipped with indigenously developed state-of-the-art Underwater Sensors.
• Designed for:
  • Anti-Submarine Warfare (ASW)
  • Low Intensity Maritime Operations (LIMO)
  • Mine Laying Operations

8. Swachh Survekshan Grameen (SSG) 2025 Launched by Jal Shakti Ministry

Context:

Union Minister of Jal Shakti, Shri C R Patil, officially launched Swachh Survekshan Grameen (SSG) 2025, a nationwide rural sanitation survey under the Department of Drinking Water and Sanitation (DDWS), Ministry of Jal Shakti. The launch event took place in New Delhi in the presence of Minister of State Shri V. Somanna, senior officials from DDWS, and state-level sanitation mission directors.

Key Objectives

• Provide a national ranking of States, UTs, and Districts on rural sanitation indicators
• Sustain and assess ODF Plus Model villages under SBM-G Phase II
• Encourage data-driven governance through structured monitoring
• Foster Jan Bhagidari and community-led sanitation practices

Strategic Features of SSG 2025

• Anchored in SBM-G Phase II: Focused on strengthening rural sanitation outcomes
• Independent Agency Survey: Structured evaluation through trained personnel and verified data
• Four Evaluation Components:
  • Service-Level Progress (SLP): Based on district self-assessment and desktop verification
  • Direct Observation: Field-based survey of villages, households, schools, and public spaces
  • Functionality Check: Assessment of PWMUs, FSM units, GOBARdhan Plants
  • Citizen Feedback: Real-time input through a dedicated mobile app and in-person surveys

Banking/Finance

1. RBI Directive on Default Loss Guarantee (DLG)

What is Default Loss Guarantee (DLG)?

• A contractual arrangement where a fintech entity guarantees to compensate lenders (banks or NBFCs) for losses arising from loan defaults.
• Typically covers losses up to 5% of the loan portfolio.
• Acts as a risk mitigation tool for lenders partnering with fintechs in loan origination.

Key Highlights of RBI’s Directive

• NPA Recognition and Provisioning:
  • Lenders must exclude DLG cover while recognizing Non-Performing Assets (NPAs) and making provisions.
  • DLG invocation does not affect borrower liability on the underlying loan.
  • The DLG amount invoked cannot be set off against the underlying individual loans.
  • Lenders are required to recognize NPAs and make provisions independently, irrespective of DLG coverage.
• Recovery and Invocation:
  • Recovery proceeds from loans with invoked DLG may be shared with the DLG provider as per contract terms.
  • Once invoked, the DLG cannot be reinstated, even if loan recoveries occur later.
• Rationale and Impact:
  • Intended to address overreliance of fintechs on DLG for credit risk management.
  • Places full responsibility for NPA recognition and provisioning on lenders, enhancing prudence.
  • Expected to lead to reduced co-origination partnerships between banks and fintechs due to increased lender risk exposure.
  • Seen as a credit tightening measure by RBI to ensure caution in lender-fintech partnerships.

Additional Recent Update (May 2025)

• RBI is seeking approval to allow domestic banks and their foreign branches to lend Indian Rupees to overseas borrowers for the first time, marking a significant move in international banking operations.

Implications

• Strengthens risk management discipline among lenders and fintechs.
• Could reshape fintech lending business models that depend on DLG.
• Enhances transparency and accountability in loan loss provisioning.
• May impact fintech-bank collaborations, influencing credit availability in certain segments.

BS

2. Niveshak Shivir by IEPFA and SEBI

Context:

The Investor Education and Protection Fund Authority (IEPFA), under the Ministry of Corporate Affairs, in collaboration with SEBI, has launched Niveshak Shivir, a pilot investor facilitation camp. The first camp will be held in Pune on June 1, 2025, aimed at providing a one-stop solution for resolving issues related to unclaimed dividends, shares, and other investor services.

Key Objectives

• Facilitate direct investor grievance redressal without intermediaries
• Provide on-site resolution of long-pending IEPFA claims
• Ensure timely disbursement of unclaimed dividends and shares
• Promote financial literacy and investor empowerment

Services Offered

• Direct assistance in claiming dividends held for 6–7 years
• On-the-spot KYC and nomination updates
• Instant claim resolution for pending IEPFA cases
• Stakeholder engagement: Companies with high volumes of unclaimed investor accounts to set up helpdesks

Significance and Impact

• Builds a transparent, investor-centric financial ecosystem
• Reduces reliance on intermediaries in claim processes
• Encourages participation from high-impact regions with unclaimed investments
• Enhances investor trust through proactive government facilitation

About IEPFA

The Investor Education and Protection Fund Authority is a statutory body dedicated to investor awareness, protection, and education in India. It works through nationwide campaigns, digital tools, and strategic partnerships to build a financially informed citizenry.

3. Cassette-Swap Model for ATMs

Context:

India’s transition to a cassette-swap model for ATM cash replenishment, aimed at improving security and operational efficiency, has missed its fourth consecutive deadline, originally set for FY21 and now extended beyond FY25. Initiated in 2018 following recommendations of the D.K. Mohanty Committee on Currency Movement, the plan was to phase out open-tray replenishment at ATMs in favor of a more secure lockable cassette mechanism.

What is the Cassette-Swap Model?

• Involves preloaded, lockable cash cassettes prepared by cash-in-transit (CIT) firms
• Reduces risks of counterfeit currency, theft, and human error
• Simplifies reconciliation of cash balances from previous replenishments
• Minimizes physical handling of cash inside ATMs by service personnel

Timeline and Implementation Phases

The implementation was to occur in four phases across 30 cities:

• By June 2023: Delhi, Mumbai, Bangalore, Chennai, Kolkata
• By September 2023: Ahmedabad, Hyderabad, Pune, Jaipur, Raipur, Lucknow, Bhubaneswar, Coimbatore
• By December 2023: Vizag, Patna, Vadodara, Ludhiana, Bhopal, Chandigarh, Vijayawada, Agra, Guwahati
• By March 2024: Surat, Nagpur, Indore, Goa, Jamshedpur, Cochin, Kanpur, Ranchi

RBI’s Position and Regulatory Push

• RBI initiated the mandate on April 12, 2018, post the D.K. Mohanty panel’s recommendations
• RBI excluded Cash Recycler Machines (CRMs) and onsite ATMs from the mandate
• A stock-taking meeting with the Cash Logistics Association (CLA) was held in 2024 after banks requested an extension
• CLA submitted a confidential update, and RBI set up an internal monitoring committee

Challenges in Implementation

• High cost of cassettes: ₹12,000–₹15,000 per unit
• Capital expenditure burden not yet resolved between banks and CIT firms
• Logistical limitations in Tier-2/3 cities: cash vans cannot accommodate both cassettes and currency
• Lack of consensus on interchange fee sharing (recently hiked from ₹17 to ₹19) between banks and CIT providers
• Legacy ATM infrastructure is still dominant, with only 25–30% ATMs being CRMs

Why the Cassette-Swap Model Matters

• Enhances security and reduces risks of cash fraud
• Ensures better cash audit trail and accountability
• Aligns with international best practices in cash logistics
• Intended to modernize ATM infrastructure amid rising digital payments

TH

4. RBI Annual Report 2024 Highlights Shift to EBLR in Indian Bank Loans

Context:

The Reserve Bank of India (RBI) Annual Report for FY2023-24 reveals a major shift in the Indian lending landscape, with a growing proportion of loans now linked to external benchmarks. This transition enhances transparency and strengthens monetary policy transmission.

Key Data (as of December 2024)

• 61% of total loans in the banking system are linked to an External Benchmark Lending Rate (EBLR).
• Loans benchmarked to MCLR (Marginal Cost of Funds Based Lending Rate) have declined to 36%.

Institution-wise Distribution of Floating Rate Loans

• Public Sector Banks (PSBs):
  • 44.6% of floating rate loans are linked to EBLR.
  • A high share of MCLR and other legacy rate-linked loans persists, indicating slower transition.
• Private Sector Banks:
  • 85.9% of floating rate loans are linked to EBLR, reflecting quicker adoption of the benchmarked system.
  • Minimal reliance on MCLR and older benchmark systems.

What is EBLR?

The External Benchmark Lending Rate (EBLR) is a type of floating lending rate linked to an external, publicly available benchmark like the RBI Repo Rate, 3-month/6-month Treasury Bill Yield, or any other benchmark published by FBIL (Financial Benchmarks India Ltd).

Key Components of EBLR:

• Benchmark Rate –
  • Set by an external institution like RBI or FBIL
• Spread/Margin –
  • Fixed at loan origination; includes operational cost, credit risk premium, etc.
• Risk Premium –
  • May vary depending on the borrower’s credit profile

Comparative Insights:

Parameter	Public Sector Banks (PSBs)	Private Sector Banks
Share of EBLR-linked loans	44.6%	85.9%
Share of MCLR/legacy rate loans	Higher	Significantly lower

Implications for Indian Banking:

• The EBLR regime improves transparency and facilitates faster monetary policy transmission.
• Private sector banks are leading the transition to modern lending practices.
• Public sector banks need to accelerate the migration from MCLR to EBLR for better alignment with RBI’s policy framework.

BS

5. India’s Record Remittances in FY24

Context:

India received a record $118.7 billion in inward remittances in 2023–24, surpassing foreign direct investment (FDI) inflows and financing over half of the merchandise trade deficit. The RBI’s Sixth Round of India’s Remittances Survey (released March 2025) reveals critical trends in the composition, value, and mode of remittances, underlining their rising importance in India’s external sector balance.

Key Highlights

• Total Inward Remittances (FY24): $118.7 billion (new record)
• Comparison with FDI: Higher than total FDI inflows in FY24
• Macroeconomic Role: Financed >50% of merchandise trade deficit
• Stability Factor: Key stabilising force amid global economic uncertainty

Structural Shifts in Remittance Sources

• Rise of Advanced Economies (AEs):
• U.S. share: 27.7% (up from 23.4% in 2020–21)
• Combined share of U.S., U.K., Canada, Australia, Singapore: 51.2%
• GCC nations’ share declined to 37.9%
• Implication: Reflects a shift in migrant profile — from low-skilled workers in GCC to high-skilled professionals and students in AEs

Impact of Migrant Profile Evolution

• High-skilled migrants in AEs:
• Tend to have stable incomes and remit consistently
• Likely to integrate abroad, reducing long-term remittance intensity
• Concentration Risk:
• Transactions above ₹5 lakh accounted for 29% of total value, though only 1.4% of volume
• Suggests a growing reliance on fewer, high-value remitters

Digital Transformation of Remittance Channels

• Digital share of transactions (FY24): 73.5%
• Average transaction cost for $200: 4.9% (below global average of 6.65%)
• SDG benchmark target: 3%
• Drivers: Rise of fintech and app-based platforms

Corridor Disparities in Digital Adoption:

Country	Digital Share (%)
UAE	76.1
Saudi Arabia	92.7
Canada	40.0
Germany	55.1
Italy	35.0

• Policy Challenge: Improve cross-border digital payment infrastructure and harmonize regulatory environments

Regional Disparities in Remittance Receipts:

• High-receiving States: Maharashtra, Kerala, Tamil Nadu (51% of total)
• Low-receiving States: Bihar, Uttar Pradesh, Rajasthan (<6% combined)
• Underlying Cause: Unequal access to migration-enabling systems (language training, foreign credentialing, job linkages)
• Policy Need: Make skilling missions more state-responsive to reduce regional inequality in remittance potential

Missing Dimensions: Household-Level Data:

• No current data on end-use of remittances at household level
• Limits insight into developmental potential (consumption vs. savings/investment)
• Policy opportunity:
• Develop savings-linked remittance products
• Promote financial literacy for migrant families
• Encourage productive asset formation

BS

6. RBI Strengthens Foreign Exchange Reserves

Context:

The Reserve Bank of India (RBI) reported an 8.2% growth in its balance sheet, reaching Rs 76 lakh crore in FY25. A key focus of the central bank is to bolster resilience in its foreign exchange reserves, which now constitute over 74% of its total assets. This comes amid rising concerns over the “weaponisation of reserves,” where countries face financial sanctions freezing foreign-held assets during geopolitical conflicts.

RBI’s Foreign Exchange Reserves and Risk Management

• Current Reserves Size: India’s forex reserves rose by 3.4% in FY25 to $668 billion, following an 11.7% increase the previous year.
• Diversification Strategy: To mitigate risks associated with global conflicts and financial market shocks, RBI emphasizes diversification across asset classes, currencies, and jurisdictions. Currently, a large share of India’s reserves is invested in US dollar assets, primarily US Treasuries.
• Objective: The diversification aims to ensure safety, liquidity, and adequate returns while protecting reserves from geopolitical and market vulnerabilities.

Digital Infrastructure and Data Security Initiatives

• RBI plans to launch the Indian Financial Services (IFS) Cloud in 2025–26, developed by its subsidiary IFTAS.
• This community cloud service, designed exclusively for RBI and regulated financial institutions, aims to enhance data security, operational efficiency, and compliance with India’s data localisation regulations.
• This move comes in response to increasing cyberattack threats targeting domestic financial data.

Promotion of the Indian Rupee in International Trade

• To reduce dependency on major currencies like the US dollar, RBI encourages exporters and importers to settle trade transactions in Indian rupees.
• Special emphasis is placed on using the rupee through mechanisms such as the Asian Clearing Union.

7. Non-Food Credit Growth Slows to 11.2% in April 2025: RBI Sectoral Deployment Data

Context:

Non-food credit growth of Scheduled Commercial Banks (SCBs) slowed sharply to 11.2% (y-o-y) in the fortnight ending April 18, 2025, compared to 15.3% in the same period last year. The decline was broad-based across sectors including agriculture, services, personal loans, and industry.

Sector-wise Credit Trends

• Agriculture & Allied Activities
  • Growth declined to 9.2% y-o-y (vs. 19.8% last year).
• Services Sector
  • Credit growth slowed to 11.2% y-o-y (vs. 19.5%).
  • Mainly due to reduced lending to NBFCs.
  • However, credit to trade and computer software remained strong.
• Personal Loans
  • Slowed to 14.5% y-o-y (vs. 17.0%).
  • Deceleration due to weaker growth in:
    • Other personal loans
    • Vehicle loans
    • Credit card outstanding
• Industry
  • Recorded a modest rise of 6.7% y-o-y (vs. 6.9%).
  • Notable uptick in:
    • Basic metal and metal products
    • All engineering
    • Vehicles & transport equipment
    • Textiles
    • Construction
  • Infrastructure credit growth slowed.

RBI’s Observations (FY25 Annual Report)

• Despite the moderation, bank credit growth remains in double digits.
• RBI noted that robust bank balance sheets and potential revival in private investments may support credit demand going forward.

Non-Food Credit

Non-food credit in the context of bank lending refers to the total amount of credit extended by banks to sectors other than food procurement. It’s essentially the credit that’s not directed towards supporting the Food Corporation of India (FCI) for purchasing food grains.

• What it is:
  • Non-food credit represents the majority of bank lending in India and includes loans for various sectors like agriculture, industry, services, and personal loans. 
• Why it’s important:
  • Non-food credit is a key indicator of economic activity and can help gauge the demand for loans in different sectors, providing insights into the overall health of the Indian economy. 
• What it includes:
  • Agriculture and allied activities: Loans for farming, livestock, and related industries. 
  • Industry: Loans for manufacturing, production, and other industrial activities. 
  • Services: Loans for businesses in the service sector, including finance, transportation, and retail. 
  • Personal loans: Loans for individual purposes, such as housing, education, and consumption. 

Agriculture

1. Kisan Credit card Scheme Update

Context:

The Kisan Credit Card (KCC) scheme provides a single-window facility offering both working capital and investment credit to farmers engaged in cultivation, animal husbandry, and fisheries.

Key Statistics for FY24-25 (FY25)

• Operative KCCs:
  • Declined by 2.7% compared to the previous financial year.
• Outstanding Credit Amount:
  • Increased by 4.5%, crossing ₹6 trillion.

Significance

• The KCC scheme supports farmers by providing timely credit for agricultural activities and allied sectors.
• Despite a dip in the number of active KCCs, the rise in outstanding credit indicates increased utilisation or higher credit limits per card.
• Monitoring this trend helps assess credit accessibility and financial inclusion in rural India’s agricultural economy.

2. India’s Move to Restrict Import of GM Alfalfa (Lucerne) Seeds

Context:

India plans to restrict the import of genetically modified (GM) alfalfa seeds, despite U.S. pressure to reduce import duties and allow market access. The move aligns with India’s precautionary approach to GM organisms and its emphasis on domestic seed self-sufficiency.

Why Is the Restriction Being Considered?

• Concerns over GM contamination of domestic seed stocks.
• India has not approved GM alfalfa for commercial cultivation.
• Domestic alfalfa seed is available at ₹500–800/kg, while imported GM seeds are costlier due to duties.
• India already imports Berseem fodder seed from Egypt and CIS nations, but not alfalfa.

Government Measures Under Consideration

• Development of test kits to verify genetic modification status before unloading.
• Use of powers under the Environment (Protection) Act, 1986 to regulate GM imports.
• Ensuring protection of indigenous biodiversity and seed sovereignty.

About Alfalfa (Lucerne)

• Scientific Name: Medicago sativa
• Also known as buffalo herb, purple medic, or Queen of Forages.
• Native to: Southwestern Asia
• Uses:
  • High-protein livestock fodder
  • Hay, silage, and green manure
  • Improves soil nitrogen via symbiosis with Sinorhizobium meliloti
• Benefits:
  • Long lifespan (4–8 years), drought-resistance
  • Enhances agricultural efficiency through nitrogen fixation
• Pollination: Insect-pollinated with purple flowers

GM Alfalfa: Key Features & Issue

• Genetic Traits:
  • Herbicide resistance (especially to glyphosate)
  • Reduced lignin content for better digestibility
• Developer: Monsanto (patent holder)
• Concerns:
  • Risk of cross-contamination with non-GM varieties
  • Dependence on patented seeds
  • Environmental risks like herbicide resistance in weeds

Legal & Policy Framework in India

• Environment (Protection) Act, 1986 regulates GM organism imports.
• No GM food crop has received commercial cultivation approval in India, barring GM cotton.

3. Belagavi-Based SBOF Agrosmart Launches India’s First AI-Powered All-in-One Agriculture App

Context:

SBOF Agrosmart Private Limited, headquartered in Belagavi, has introduced SBOF Agrosmart, India’s first AI-driven comprehensive agriculture app aimed at empowering farmers with real-time, data-driven insights and solutions. The app promises to revolutionize Indian agriculture by addressing key challenges such as climate unpredictability, pest outbreaks, market volatility, and access to government schemes.

Key Features of SBOF Agrosmart App

• Artificial Intelligence & IoT Powered: Offers precise, region-specific advisory and farming recommendations.
• All-in-One Platform: Provides solutions for crop management, pest control, weather updates, soil health, and government scheme information.
• Multilingual Chatbot Support: 24/7 assistance available in multiple regional languages for wider accessibility.
• Data-Driven Agriculture: Combines decade-long expertise in fertiliser manufacturing and agri-inputs with smart technology.

Challenges Addressed

Indian farmers currently face growing uncertainties from climate change, market price fluctuations, pest and disease outbreaks, poor quality inputs, and difficulties in accessing timely and reliable information.

Facts To Remember

1. Holy Relics of Lord Buddha to Return to India After Historic Vietnam Tour

• The Holy Relics of Lord Buddha will return to India on 2nd June 2025, aboard an Indian Air Force aircraft.
• The relics will arrive at Delhi’s Palam Air Force Station around 10:00 PM.
• The relics are escorted by a Government of India delegation led by Dr. Hari Babu Kambhampati, Governor of Odisha.

2. Justices Anjaria, Vijay Bishnoi, Chandurkar take oath as SC judges

Justices Anjaria, Bishnoi and Chandurkar were welcomed with warm handshakes by Chief Justice Gavai after they were read their oath of office.