Daily Current Affairs (DCA) 4 April, 2025

Daily Current Affairs Quiz
4 April, 2025

International Affairs

1. Trump Imposes 27% Tariffs on Indian Imports

Context:

U.S. President Donald Trump has officially launched what analysts are calling the most aggressive phase of his “America First” trade policy, slapping massive tariffs on global imports. In a sweeping move on Thursday, Trump announced “reciprocal tariffs” ranging between 10% and 49%, targeting countries with significant trade surpluses with the U.S. Despite active negotiations over a Bilateral Trade Agreement (BTA), India was dealt a 27% tariff, triggering concern in New Delhi, tempered with a tone of strategic patience.

What Trump Announced

New Tariff Regime:

• Baseline Tariff: 10% on all U.S. trading partners, effective April 5
• Reciprocal Tariffs: Up to 49% for nations with the largest trade deficits with the U.S., kicking in on April 9

Legal Justification:

• Invoked under the International Emergency Economic Powers Act (IEEPA) of 1977
• Trump declared trade imbalances a “national emergency”

Trump’s Statement:

“India imposes tariffs of 52% on us. We’re offering them a discount. 27%. That’s fair.”

India’s Position: Strategic Silence with a Side of Caution

• While other major economies swiftly threatened retaliatory actions, India’s response was notably muted.
• The Commerce Ministry released a statement affirming that it is “carefully examining the implications” of the tariff hikes. Ongoing consultations are underway with industry stakeholders and exporters. India continues to value its Comprehensive Global Strategic Partnership with the U.S.
• Negotiations on a $500 billion bilateral trade goal by 2030 remain on the table.
• Interestingly, the ministry also mentioned it is exploring “opportunities” arising from the shifting global trade architecture signaling that India may look to leverage new gaps or alliances.

Immediate and Brutal

The market reaction was swift and negative signaling investor fears of a prolonged and volatile trade standoff.

Global Indices Tumble:

• Nikkei (Japan): ▼ 4%
• European Markets: ▼ Over 2%
• India’s Sensex: ▼ 300+ points
• Nifty: Dropped
• Dow Jones (U.S.): ▼ 3% within the first trading hour
• Nasdaq: ▼ 4%

Global Blowback Begins

• European Union, China, and Canada condemned the move and vowed countermeasures. Japanese Trade Minister Yoji Muto called the move “extremely regrettable”, hinting at diplomatic pushback.
• Many trade analysts believe this action could trigger a cascade of retaliatory tariffs and undo years of trade diplomacy.

What This Means for India

• Immediate Pressure: Exporters from key Indian sectors — textiles, pharmaceuticals, and IT services — could face serious headwinds in the U.S. market.
• Diplomatic Crossroads: New Delhi now finds itself in a balancing act — between safeguarding economic interests and preserving long-term strategic alignment with Washington.
• Potential Opportunities: India may seek deeper ties with alternative markets like the EU, ASEAN, and Africa, or pursue trade partnerships with tariff-hit economies seeking new allies.

2. India–China Relations See Tentative Thaw

Context & Background

India and China appear to be making cautious diplomatic strides toward improving ties, influenced in part by the broader US trade war dynamics. The 75th anniversary of diplomatic relations has offered an opportunity to recalibrate bilateral engagement.

Key Developments

• Exchange of Greetings:
  • On April 1, President Droupadi Murmu and Chinese President Xi Jinping exchanged messages to mark 75 years of diplomatic relations.
  • Prime Minister Modi and President Xi had met in October during the BRICS summit in Kazan, Russia their first major interaction since the 2020 Galwan clash.
• Symbolic & Diplomatic Engagements:
• A commemorative event in New Delhi featured Foreign Secretary Vikram Misri and Chinese Ambassador Xu Feihong, where both sides voiced intent to rebuild relations.
• China anticipates PM Modi’s possible participation in the SCO Summit in Tianjin this autumn.
• Restoration of Ties Underway:
  • Direct Flights: Talks ongoing to resume flights suspended since 2020.
  • Visas: China has issued 70,000 visas to Indians in 2024, but journalist and Kailash pilgrimage visas remain unresolved.
  • Water Data Sharing: Renewed dialogue around sharing cross-border river data.
  • Air Services Agreement: Civil aviation ministries in discussion for a revised bilateral pact.

Border Situation & Strategic Concerns

• Military Standoff Remains Fragile:
  • Though disengagement has occurred in some areas, Indian and Chinese troops have only moved short distances from the Line of Actual Control (LAC).
  • Much of the military equipment remains deployed, signaling incomplete de-escalation.

US Factor as a Catalyst

• The US’s recent imposition of 27% tariffs on Indian goods and 54% total tariffs on Chinese goods is believed to be nudging China and India toward closer coordination under shared pressure.
• India–China trade stood at $118.4 billion in 2023–24, with India carrying an $85 billion trade deficit.

While mistrust, especially over border issues, lingers, there is clear diplomatic momentum toward rebuilding India–China ties. Strategic necessity, driven in part by shared pressures from the US trade war, may foster more collaboration—if both sides see mutual benefit.

BS

National Affairs

1. NITI Aayog and NCAER Launch States Economic Forum Portal

Context:

This week, NITI Aayog, in collaboration with the National Council of Applied Economic Research (NCAER), unveiled the NITI–NCAER States Economic Forum a data portal designed to aggregate and present State-level economic and development data in a comparative format. The platform provides structured insights into both fiscal indicators and social metrics, enabling data-driven discourse on Centre-State dynamics at a time when fiscal federalism is under renewed scrutiny, particularly in India’s southern States.

What the Portal Offers

The platform consolidates a wide range of publicly available datasets from sources such as the 2011 Census, the Periodic Labour Force Survey, and the RBI’s State Finances Report. Key features include:

• State-wise analysis of tax and non-tax revenues
• Human development indicators like literacy rates, school dropout figures, and employment statistics
• Historical trends in central fund devolution
• Comparative views across States to highlight disparities and fiscal realities

Though the data itself is not new, the portal’s user-friendly and comparative presentation brings clarity to India’s complex federal landscape. It enables better understanding of resource gaps, regional needs, and developmental asymmetries.

Why This Matters Now

• This initiative is timely amid intensifying Centre-State tensions, especially regarding revenue-sharing, delimitation, and broader debates on equity in representation.
• Southern States, which often contribute more to the central pool than they receive, have voiced concerns over perceived imbalances in fiscal policy and administrative control. The new platform can help shift these debates from political sentiment to evidence-based policy dialogue.

Challenges and Limitations

• While the portal brings structure to scattered data, it relies heavily on existing sources, some of which are dated or contested in quality. Critics of India’s economic data landscape remain cautious, noting that accuracy and granularity still vary widely.
• Nonetheless, the portal provides a baseline for meaningful engagement, particularly when debates risk becoming emotionally or politically charged.

Federalism

• The real value of this data tool will emerge through its uptake by policymakers, including constitutional bodies like the Sixteenth Finance Commission.
• India’s federal balance depends not only on fund flows but also on recognition of regional diversity in policymaking.

Unfortunately, debates on federalism are often reduced to narrow binaries such as the three-language policy or postponing delimitation rather than systemic reforms. Over-centralisation risks alienating States, while regional pushback sometimes turns into parochial resistance. What’s needed is mutual recognition, transparency, and trust.

TH

2. Starlink in India

Context:

India’s continued struggle with last-mile digital connectivity, particularly in rural and remote areas, may have found an unconventional solution. The recent partnerships between SpaceX and India’s telecom giants Airtel and Jio to deploy Starlink satellite Internet services mark a significant inflection point in the country’s digital and geopolitical landscape. Beyond business, these alliances raise fundamental questions about national sovereignty, technological autonomy, and economic power in the digital age.

A Win-Win, But Not Without Strings

• For Indian telecom firms, Starlink enables high-speed access to underserved regions without the prohibitive costs of laying fiber optic cables or building towers.
• For SpaceX, the partnership unlocks a large and complex market, with Airtel and Jio helping navigate India’s regulatory maze.

• Yet this isn’t just market expansion — it’s geopolitics in orbit. Satellite communication infrastructure, especially when deployed by foreign private entities, touches on issues of national security, data sovereignty, and international influence.
• SpaceX, as a U.S.-based company, represents a broader ideological and strategic alignment. India’s choice to work with Starlink over waiting for indigenous options or aligning with China’s GuoWang constellation is telling. It signals a strategic tilt toward democratic digital ecosystems over authoritarian alternatives in the Indo-Pacific.

The Geopolitical Economy of Satellite Internet

To understand the implications, we can place satellite Internet in a matrix of economic value and geopolitical control:

• Digital Sovereignty: High economic value, high control. China’s GuoWang represents this model — a fully state-owned constellation, offering both leverage and autonomy.
• Market Dominance: High value, low control. This is where Starlink operates — profitable and expansive, but largely outside host nations’ jurisdiction. Routing Starlink through Airtel and Jio is an attempt at soft containment.
• Strategic Asset: Low value, high control. India’s own indigenous satellite efforts fall here — crucial for sovereignty, but not yet economically scalable.
• Marginal Presence: Low value, low control. Emerging players like Amazon’s Kuiper are still finding their footing, offering limited influence.

India’s decision seems pragmatic, but not without cost. Monopolistic tendencies are a growing concern. SpaceX already has over 7,000 satellites in orbit, dwarfing OneWeb (650+) and Kuiper. This raises red flags over pricing power, infrastructure dependency, and private players wielding state-like influence — as demonstrated when SpaceX restricted Ukraine’s access during a conflict.

The Missing Player: BSNL

• Strikingly absent from this connectivity equation is BSNL, India’s public sector telecom provider. Its inclusion could have balanced the equation — offering Starlink rural reach while giving the Indian government more oversight and strategic leverage.
• Financial constraints aside, BSNL’s absence highlights a missed opportunity for public-private alignment.

Balancing Act: Strategy vs. Dependency

• India is aiming for Digital Sovereignty, but building that capacity indigenously will take years.
• Meanwhile, leveraging technology transfer clauses, local data hosting mandates, and controlled partnerships can preserve strategic autonomy. A “managed dependency” model may be India’s best near-term bet providing connectivity while building long-term independence.

This also raises larger questions about global Internet governance. As developing nations weigh options between American, Chinese, or self-reliant systems, India’s Starlink model offers a hybrid approach — tech pragmatism with sovereignty safeguards.

Digital Inclusion or Orbital Divide?

• The promise of universal connectivity will mean little if pricing remains prohibitive for rural populations. India will need creative solutions — such as tiered pricing, shared access models, and community-based packages to make satellite Internet viable at the base of the pyramid.
• India has a long history of frugal innovation, and applying this to satellite tech could be a game-changer.

The broader challenge lies in governance. With thousands of satellites launching each year, orbital debris management and space traffic coordination are becoming urgent. These are transnational challenges requiring cooperation, even amid strategic competition. Without it, the space commons may suffer from the same neglect that once plagued environmental and maritime governance.

3. Coastal Shipping Bill, 2024

Context:

The Lok Sabha has passed the Coastal Shipping Bill, 2024, aimed at strengthening India’s maritime sector by establishing a dedicated legal framework for coastal trade. This move is expected to support more efficient, sustainable, and cost-effective transportation.

Key Highlights:

• The Bill provides a legal structure specifically for coastal shipping, recognizing it as a distinct mode of transport.
• It is designed to help decongest road and rail networks by promoting short-sea and inland waterway movement of goods.
• The legislation is part of a broader effort to enhance multimodal connectivity and lower logistical costs.
• According to Union Minister Sarbananda Sonowal, the Bill will help unlock the potential of India’s 7,500+ km coastline, supporting domestic trade and economic development.

Impact:

• Expected to reduce carbon emissions and improve sustainability in freight movement.
• Aims to make cargo shipping more competitive and streamlined, attracting investment in port infrastructure and services.
• Supports the ‘Sagarmala’ initiative, enhancing port-led development across India.

TH

4. Waqf (Amendment) Bill, 2025

Context:

• A Waqf is a permanent endowment made by a Muslim for religious, charitable, or public welfare purposes.
• Once designated as Waqf, the property becomes inalienable it cannot be sold, gifted, inherited, or mortgaged.
• The property is considered to be vested in God, and thus, perpetual in nature.

Key Problems Addressed by the Bill

The Waqf (Amendment) Bill, 2025 seeks to resolve critical governance issues including:

• Lack of transparency in Waqf property management
• Incomplete land surveys and mutation records
• Insufficient legal provisions for women’s inheritance rights
• Surge in pending litigations (from 10,381 in 2013 to 21,618 in 2024)
• Arbitrary powers of Waqf Boards to declare land as Waqf
• Multiple disputes involving government and private land declared as Waqf
• Poor auditing, weak administration, and limited stakeholder representation

Modernizing Waqf Governance

The Bill proposes updates for clarity, fairness, and efficiency in Waqf administration:

• Renaming and redefining key terms to eliminate ambiguity
• Digitization of Waqf records for better transparency and accessibility
• Protection of individual property rights, especially in contested land claims

Case Studies of Disputed Waqf Property Claims

Several contentious Waqf property claims have led to social unrest and legal action:

• Tamil Nadu: Farmer unable to sell land due to Waqf claim over entire village
• Bihar: 7 families in Govindpur facing legal battle in Patna HC
• Kerala: 600 Christian families in Ernakulam contest ancestral land claim
• Karnataka: Protests in Vijayapura and other districts over 15,000 acres declared Waqf land
• Delhi: MoHUA reported 361 government/public properties under litigation due to Waqf claims

Empowering Muslim Women and Legal Heirs

The Bill promotes women’s welfare and inheritance rights through:

• Digitized Waqf management to reduce corruption
• Legal aid centers for resolving family and property disputes
• Support for SHGs, vocational training, and financial independence programs

Key Benefits for Women:

• Scholarships for girls
• Maternity welfare and healthcare support
• Microfinance for women entrepreneurs
• Legal support in cases of domestic violence and inheritance claims
• Pension schemes for widows

Welfare of the Poor and Underprivileged

The Bill enhances Waqf’s role in uplifting marginalized communities by:

• Preventing misuse and encroachment of Waqf assets
• Digitized tracking of Waqf properties through a centralized portal
• Auditing and accounting mechanisms for revenue utilization in:
  • Education
  • Healthcare
  • Livelihood generation
  • Affordable housing

Addressing Administrative Challenges

To streamline Waqf operations and coordination, the Bill focuses on:

• Improved transparency and accountability
• Better coordination between Waqf Boards and local authorities
• Regular audits and inspections
• Legal safeguards for stakeholder rights

Inclusive and Representative Governance

The Bill ensures equitable representation of diverse Muslim sects and other stakeholders:

• Mandatory representation from Bohra, Aghakhani, and Backward Class Muslims
• Inclusion of elected local representatives from Panchayats or Municipalities
• Provision for two non-Muslim members on each Waqf Board (excluding ex-officio members)

The Waqf (Amendment) Bill, 2025 aims to establish a secular, transparent, and accountable framework for managing Waqf properties in India. While preserving the spiritual and charitable essence of Waqf, the Bill redefines its regulatory role through:

• Legal clarity
• Stakeholder inclusion
• Digitization and modern governance principles

By addressing longstanding issues and introducing inclusive reforms, the Bill strengthens public trust, community welfare, and efficient administration of Waqf assets across the nation.

Source: PIB

5. Kumbakonam Betel Leaf and Thovalai Maanikka Maalai Receive GI Tags

Context:

Two culturally significant products from Tamil Nadu Kumbakonam Vetrilai (Betel Leaf) and Thovalai Maanikka Maalai (Garland) have been awarded the Geographical Indication (GI) tag, recognizing their regional uniqueness and cultural heritage.

Kumbakonam Vetrilai (Betel Leaf)

Geographic Origin

• Found in Cauvery Delta region:
  • Thiruvaiyaru, Papanasam, Thiruvidaimarudhur
  • Kumbakonam and Valaigaman blocks (Thanjavur and Tiruvarur districts)

Historical & Agricultural Significance

• Has a centuries-old legacy in traditional betel cultivation
• Grown alongside paddy and sugarcane on wetland farms
• Known for its distinct aroma, glossy texture, and longevity

Cultural Importance

• Commonly used in rituals, religious offerings, and traditional ceremonies
• Holds symbolic value in Tamil weddings and festivals

Thovalai Maanikka Maalai (Gem-like Garland)

GI Application Details

• Filed by: Thovalai Maanikkamaalai Kaivinai Kalaingargal Nalasangam
• Facilitated by:
  • Tamil Nadu Handicrafts Development Corporation
  • Intellectual Property Facilitation Centre, Chennai
  • MSME-Technology Development Centre, Chennai

Geographic Origin

• Exclusively made in Thovalai village, Kanyakumari district

Craft and Technique

• Known for its gem-like appearance and intricate floral folding
• Flowers used: Oleander, rose, and other multi-colored local flowers
• Artisans follow ancient techniques passed through generations
• Ability to distinguish garlands by quality, pattern, and craftsmanship

Cultural Importance

• Widely used in temples, festivals, weddings, and traditional processions
• Represents a unique identity of Tamil floral art heritage

Significance of the GI Tag

• Legal protection under the GI Act for traditional artisans and farmers
• Boosts local economy by promoting authentic regional products
• Encourages preservation of indigenous knowledge and cultural practices
• Enhances marketability and global recognition of Tamil Nadu’s traditional products

TH

Banking/Finance

1. Bankers Urge RBI to Shift to SORR as Benchmark

Key Requests Made by Bankers

1. Shift from WACR to SORR as Overnight Benchmark:
   • Bankers have recommended the Secured Overnight Rupee Rate (SORR) as a more suitable benchmark than the current Weighted Average Call Rate (WACR).
   • This proposal stems from RBI’s ongoing review of domestic rupee interest rate benchmarks, including MIBOR.
   • A special RBI committee had earlier suggested the shift to benchmarks based on secured markets like basket repo and TREP.
2. Cut in Cash Reserve Ratio (CRR):
   • Banks are pushing for a CRR cut from 4%, citing seasonal liquidity pressures due to GST and advance tax outflows.
   • A reduction is seen as essential for smoother monetary transmission and system liquidity.
   • The RBI had already reduced CRR from 4.5% to 4% in two phases in December 2024.

Monetary Policy Review Details

• The Monetary Policy Committee (MPC) will meet between April 7 and 9, with decisions announced on the final day.
• Another 25 basis point repo rate cut (after the February cut to 6.25%) is widely expected.

Bankers’ Liquidity Concerns

• Despite the current surplus of ₹1.93 trillion, bankers forecast outflows of ₹1.8 trillion around April 20, which could neutralize surplus.
• Banks are requesting clarity on RBI’s liquidity comfort level relative to Net Demand and Time Liabilities (NDTL).
• The RBI skipped its 14-day main operation for April 4–17, indicating temporary comfort with surplus.

RBI’s Liquidity Tools in Use

• Dollar-rupee buy/sell swap auctions
• Open Market Operations (OMOs)
• Variable Rate Repo (VRR) auctions
• Expectations are rising that RBI will now use Variable Rate Reverse Repo (VRRR) auctions to absorb surplus liquidity.

Deposit Rates See Cuts; SBI Withdraws ‘Amrit Kalash’ FD Scheme

• SBI has ended its special 400-day fixed deposit (Amrit Kalash) offering 7.10%, effective April 1.
• Other banks are also trimming deposit rates:
  • HDFC Bank: Reduced FDs by 35 bps (35-month) and 40 bps (55-month).
  • Yes Bank: Cut FD rates by 25 bps on select tenures.
• Banks are still cautious in reducing deposit rates due to tight deposit mobilization, even after the RBI’s repo rate cuts.

Liquidity Snapshot

Date	RBI Net Liquidity (₹ crore)
Dec 2, 2024	-89,451 (deficit)
Apr 2, 2025	+1,93,088.61 (surplus)

BS

2. Sebi Grants Open Offer Exemption to Government in Vodafone Idea Stake Hike

Context:

The Securities and Exchange Board of India (Sebi) has exempted the Government of India (GoI) from making a mandatory open offer in Vodafone Idea (Vi), following the decision to convert spectrum dues into equity.

Shareholding Impact

• Current GoI Stake: 22.6%
• Post-Conversion Stake: 48.99%
• Additional Acquisition: 34.1%

Regulatory Background

Under Sebi Takeover Regulations, any acquisition that takes an entity’s holding above 25% mandates an open offer to public shareholders.
The government’s conversion would normally trigger this obligation.

Government’s Rationale for Exemption

• Avoid further equity acquisition that could raise its stake above 50%, implying “control”—which is not the government’s intent
• Prevent cash outflows, aligning with the public interest and the company’s revival strategy
• Government’s stake will be treated as public shareholding, not promoter holding
• An open offer could defeat the purpose of the equity conversion aimed at relieving Vi’s debt burden

Sebi’s Justification

The regulator approved the exemption citing:

• Public interest
• The move’s role in easing Vi’s liquidity crisis
• Protection of banks and financial institutions with exposure to the telecom sector

Broader Implication

This exemption enables Vodafone Idea to move forward with its debt-to-equity conversion plan without triggering a change in control or additional financial burden on the government, thus aiding the telecom sector’s financial stability.

BS

3. Sebi Launches Verification System and Issues Warning to NSDL

Document Number Verification System (SebiDNVS)

• Launch Date: Thursday (April 3, 2025)
• Purpose: To enhance transparency and verifiability of official documents such as notices, orders, and summons issued by Sebi.
• Functionality: Recipients can verify the authenticity of documents using a unique document number.

Sebi’s Administrative Warning to NSDL

• Sebi has issued a formal warning to National Securities Depository Limited (NSDL).
• The warning follows an inspection of the centralised database for corporate bonds and debentures.
• NSDL has been instructed to:
  • Rectify issues found during inspection
  • Complete synchronisation of the database in collaboration with Central Depository Services (CDSL)
  • Deadline: June 30, 2025

BS

4. Poonam Gupta: New RBI Deputy Governor’s Views on Inflation and Monetary Policy

Background and Appointment

Poonam Gupta has been appointed as the new Deputy Governor of the Reserve Bank of India (RBI). She replaces Michael Patra, a noted hawk on the Monetary Policy Committee (MPC). Her first major assignment: the MPC meeting scheduled to begin Monday, April 7, 2025.

Strong Supporter of Flexible Inflation Targeting (FIT)

• Gupta supports India’s current inflation targeting (IT) framework. She believes the 4% inflation target with a ±2% tolerance band has served India well, but calls for a review.
• Key Proposal (Economic Times, Sep 2023):
  • New target: Raise target to 4.5%, within a narrower band of 3.5–5.5%.

• Rationale:
  • India has missed the 4% target in 6 of the past 8 years.
  • Core inflation has consistently exceeded 4%.
  • A moderate inflation rate of 4.8% is not necessarily harmful to economic growth.

Defense of Core Monetary Mandate (NCAER Paper, Aug 2024)

Co-authored with Barry Eichgreen, this paper supports keeping price stability as the RBI’s primary mandate.

Arguments Against Broadening Mandate:

• Expanding responsibilities may dilute focus on inflation.
• Complexity could undermine accountability and destabilize inflation expectations.
• Radical changes like targeting core inflation or adopting discretionary regimes would be risky.

Market Expectations

With Gupta stepping in for Patra, market observers are closely watching how her more nuanced and balanced stance will shape RBI’s future rate actions. Unlike Patra’s hawkish tone, Gupta’s writings hint at a data-driven, flexible approach.

Mint

5. RBI’s First OMO of FY26 Gets Bids for 4x Value

Context:

The Reserve Bank of India’s first open market operation (OMO) purchase for FY26 drew strong demand, with bids totaling ₹80,820 crore, four times the notified amount of ₹20,000 crore. The RBI has also decided to skip the 14-day main variable rate repo (VRR) operation for April 4–17, citing improved liquidity.

Key Highlights

• Total Bids Received: ₹80,820 crore
• Notified Amount: ₹20,000 crore
• Highest Acceptance: ₹6,660 crore for the 8.24% GS 2033 bond
• Market Trend: Bonds were offered at closer-to-market prices, unlike earlier discounted OMOs
• Expert Insight: Institutions bid aggressively; dealers likely to book profits

Liquidity and Repo Operations

• Liquidity Shift: Banking liquidity moved into a mild surplus from March 29
• 14-day VRR: Cancelled due to improved conditions
• February VRRs: ₹1.25 lakh crore infused earlier will mature Friday, creating liquidity demand
• Economist View: Sustainable transmission needs ₹1–2 lakh crore in surplus liquidity

Upcoming Plans

• RBI has announced three more OMO purchases of ₹20,000 crore each
• The first government securities auction of FY26 is scheduled for Friday with ₹30,000 crore in 10-year G-secs

Bond Market Movement

• 10-year G-sec yield: Closed at 6.50%, down 2 basis points
• Market participants expect future OMO prices to align with current market levels rather than at a discount

TET

6. Bankers Seek Return to Daily Overnight Window

Context:

Lenders have urged the Reserve Bank of India (RBI) to revert to the daily overnight borrowing window as the main liquidity tool. They argue this shift would improve systemic liquidity predictability and enable faster transmission of policy rate cuts.

Key Discussion Points

• Meeting Held: Thursday between RBI officials and top bank representatives
• Request Made: Shift from the current 14-day Variable Rate Repo (VRR) to daily, on-tap borrowing
• Reasoning:
  • Difficulty in forecasting fortnightly liquidity needs due to 24×7 payment systems
  • Need for predictable, readily accessible liquidity support
  • Daily auctions are already being conducted; formal framework change sought

Liquidity Framework

• Current Model (Feb 2020 onwards):
  • 14-day VRR as the main tool
  • Auctions from overnight to 13-day tenors for fine-tuning
• January 2025 Update: RBI began daily VRR auctions on working days, improving liquidity

Banking System & Market Impact

• Systemic Liquidity: Shifted from deficit to mild surplus in March
• Deposit Rates: Reduced by 25–40 basis points in anticipation of liquidity surplus
• Impact on Lending: Lower deposit rates will help reduce MCLR (Marginal Cost of Fund-based Lending Rate)

TET

7. NCLAT Approves Bharti Telecom’s Capital Reduction Scheme

Context:

The National Company Law Appellate Tribunal (NCLAT) has approved Bharti Telecom’s 2018 capital reduction scheme, rejecting minority shareholders’ objections that the scheme was unfair and non-compliant with legal standards.

Key Points

• Scheme Nature: Capital reduction involves the company buying back shares from shareholders, thereby reducing its share capital.
• Approval: NCLAT found the scheme legally compliant and procedurally sound.
• Majority Support: 99.90% of shareholders voted in favor of the scheme.

Minority Shareholder Objections

• Allegation: Claimed Bharti Telecom undervalued the shares by applying a 25% discount, calling it unfair and unlawful.
• Representation: Minority shareholders constitute just 1.09% of Bharti Telecom’s total share capital.

Legal and Procedural Compliance

• Bharti Telecom maintained that the scheme followed all relevant legal and regulatory procedures.
• The Tribunal upheld the argument that overwhelming shareholder support confirmed corporate governance norms were respected.

TET

8. BlackSoil-Caspian Debt Merger Gets RBI Nod; NCLT Approval is Next

Context:

BlackSoil Capital and Caspian Debt have secured approval from the Reserve Bank of India (RBI) for their merger. The deal now awaits clearance from the National Company Law Tribunal (NCLT), expected within six to nine months.

Key Details

• Entities Involved:
  • BlackSoil Capital: An alternative credit platform.
  • Caspian Debt: An impact investment lender.
• Regulatory Progress:
  • RBI Approval: Received.
  • NCLT Approval: Pending, expected within 6–9 months.

Strategic Impact

• Enhanced Lending Capacity: The merger strengthens lending to startups, MSMEs, and impact-oriented businesses with smaller credit needs.
• Geographic Expansion:
  • Extended presence in key metros: Mumbai, Hyderabad, Delhi, and Bengaluru.

9. EPFO Simplifies Online Claims and Bank Account Seeding Process

Removal of Cheque Leaf / Attested Bank Passbook Upload Requirement

What’s Changed:

• EPFO has permanently removed the need to upload a scanned image of a cheque leaf or attested bank passbook for filing online claims.

Background & Pilot Success:

• The change was piloted from May 28, 2024, for KYC-updated members. Over 1.7 crore EPF members benefited during the pilot phase.

Why It Matters:

• As the bank account is already verified during UAN-linked bank account seeding, additional documents became redundant.
• Ensures faster processing and fewer claim rejections due to unreadable uploads. Will immediately benefit around 6 crore EPF members.

Elimination of Employer Approval for Bank Account Seeding with UAN

What’s Changed:

• Employer approval is no longer required for seeding or updating bank account details with the Universal Account Number (UAN).

Current Process & Bottlenecks:

• Bank verification takes ~3 days, but employer approval takes ~13 days, delaying the overall process.
• Over 14.95 lakh bank account seeding requests were pending at the employer level.

Impact of the Reform:

• Immediate benefit to 14.95 lakh members awaiting employer approval. Simplifies seeding and updating bank details—now directly authenticated via Aadhaar OTP.
• Improves Ease of Doing Business for employers and Ease of Living for employees.

Benefits of the New EPFO Process Simplification

• Faster Claims Processing: No document upload, no employer delays
• Reduced Grievances: Fewer rejections due to poor document quality
• Efficient Workload Management: Employers relieved from redundant approval steps
• Member Empowerment: Easy bank account update via Aadhaar OTP authentication
• Digital Transformation: Aligned with EPFO’s vision for a simplified, tech-driven service ecosystem

PIB

10. SBI Research Report: 10 Years of Pradhan Mantri Mudra Yojana (PMMY)

Key Highlights from SBI Report

Rising Share in Financially Underserved States:

• The State Bank of India report highlights a significant geographical shift in PMMY loan disbursement over the past decade, with increasing focus on states with historically lower financial inclusion.

State-wise Growth in Loan Share

• Bihar: Share increased from 5.67% in FY16 to 10.97% in FY25
• Uttar Pradesh: Share rose from 9.27% to 11.30%
• Odisha: Marginal increase from 4.24% to 4.51%
• North-East India: Witnessed steady growth in PMMY loans, reversing historic credit shortfalls

Reasons Behind the Shift

• Targeted policy interventions for under-served regions
• Increased ease of access to micro-credit for small businesses
• Focused efforts to reduce regional financial disparities

Loan Disbursement Trends and Growth Metrics

• Overall Sanctioning:
  • Over ₹33 lakh crore sanctioned under PMMY in the last 10 years
• Average Loan Size:
• Increased from ₹38,000 in FY16 to ₹1.02 lakh in FY25
• Indicates scaling and maturity of micro and small businesses supported under the scheme
• Continued Presence in Industrial States:
  • Maharashtra, Tamil Nadu, and Karnataka continue to dominate in absolute loan volumes
  • However, a clear policy shift is visible toward more equitable distribution
• Role of Digital Platforms in Bridging Credit Gaps
  • Platforms like ‘PSB Loans in 59 Minutes’ and ‘UdyamiMitra’ have expanded credit accessibility
  • Launch of the Unified Lending Interface (ULI) is expected to further improve formal credit availability in low-penetration states

Remaining Challenges and Way Forward

• Identified Bottlenecks:
  • Infrastructure gaps
  • Low levels of financial literacy
  • Lack of skill development and entrepreneurial training
• Recommendations:
  • Sustained capacity building and financial education
  • Creation of stronger market linkages to ensure long-term growth
  • Integration of credit access with entrepreneurial support systems

The SBI report confirms that the PMMY has matured into a more inclusive scheme, now actively bridging regional disparities in credit distribution. While financial access has improved, the next phase must focus on enhancing usage, business sustainability, and economic empowerment at the grassroots level.

11. Citi-SBI Social Loan Facility: Boosting Credit for India’s Small Farmers

Context:

Citi and the State Bank of India (SBI) have launched a $295 million social loan facility aimed at improving financial access for small and marginal farmers. The credit will be routed through SBI’s Kisan Credit Card (KCC) loan portfolio, ensuring that rural farmers receive the funds necessary to enhance productivity and income.

Objectives and Scope

• Provide essential credit to farmers with small landholdings
• Empower rural agricultural communities through accessible financial support
• Align with the Government of India’s vision of financial inclusion and rural development
• Encourage investment in improved farming practices and equipment

Key Features of the Collaboration

• Loan structured and facilitated by Citi’s Trade & Working Capital Solutions
• Funds channelled via SBI’s Kisan Credit Card portfolio
• Supports sustainable agricultural practices and economic empowerment
• Focuses on underserved communities that face difficulty in securing formal credit

SBI Share Performance Snapshot (as of April 04, 2025 – 10:10 AM)

• Current trading price: ₹774.75
• Day’s change: Down by 0.57%
• One-month performance: Gained 8.20%

The Citi-SBI social loan facility stands as a transformative step toward democratizing credit in India’s agricultural sector. By combining Citi’s financial innovation with SBI’s expansive rural network, the initiative not only fosters rural economic resilience but also underlines the shared commitment to inclusive and sustainable growth.

12. Bank of Maharashtra Partners with Customer Capital to Launch Exclusive Travel and Loyalty Platform

Context:

Bank of Maharashtra has partnered with Customer Capital, a specialist in captive commerce loyalty solutions, to launch an exclusive travel platform and loyalty rewards program for its cardholders. The collaboration is designed to enhance the user experience and promote greater customer engagement through a branded travel booking service accessible via the Bank of Maharashtra’s card website and app.

Key Highlights of the Partnership

• Launch of a white-label travel platform called Tripstacc tailored for Bank of Maharashtra customers
• Platform will allow users to book hotels and tickets directly, offering a seamless, rewarding experience
• Provides the bank with insight into Travel and Expense (T&E) spend patterns not possible through traditional promotions
• Aims to increase engagement, improve value offerings, and deepen market penetration in travel-related spending

Strategic Implications for the Loyalty Market

• India’s loyalty program market is projected to grow to USD 7.92 billion by 2028
• This collaboration taps into the potential of technology-driven, AI-powered loyalty platforms
• Positions Bank of Maharashtra to become a preferred partner by offering curated value to its cardholders

About Customer Capital

• Founded in 2022, Customer Capital is redefining loyalty through captive commerce and AI-powered solutions
• Operates a suite of white-label platforms (Staccs) for industries like travel and e-commerce
• Provides strategic consulting, technology accelerators, and AI-driven engines to make loyalty programs profitable and consumer-loved

This partnership marks a significant move by Bank of Maharashtra to strengthen its digital offerings and loyalty capabilities. By adopting Customer Capital’s Tripstacc platform, the bank is set to offer a highly personalized, data-informed travel booking experience, solidifying its role in the evolving landscape of customer-centric financial services.

BS

13. IDFC FIRST Bank Authorised by CPAO for Pension Disbursement

Context:

IDFC FIRST Bank has been authorised by the Central Pension Accounting Office (CPAO) to disburse pensions to central government pensioners, including:

• All India Service Officers
• Former Members of Parliament
• Retired Judges of High Courts and the Supreme Court
• Former Presidents and Vice Presidents of India
• Officials of Civil Ministries and Departments (excluding Railways, Posts, Telecom, and Defence)

Integration and Technical Readiness

• The integration between CPAO and IDFC FIRST Bank is complete, enabling seamless pension disbursements directly into pensioners’ IDFC FIRST Bank savings accounts.

Joint Account Facility for Family Pension

• Pensioners have the option to open a savings account jointly with their spouse. In the event of the primary pensioner’s demise, the spouse can continue receiving the family pension in the same account.

Financial Snapshot of IDFC FIRST Bank

• Deposit Base: ₹2,27,316 crore
• Loans and Advances: ₹2,31,074 crore

This authorisation positions IDFC FIRST Bank to enhance its services by facilitating pension disbursements for central government pensioners, reflecting its commitment to expanding public sector banking services.

TET

14. Axis Bank Partners with Fortune 500 Company for B2B Collections via Bharat Connect

Context:

Axis Bank has partnered with a Fortune 500 company to launch a B2B collections solution through NBBL’s Bharat Connect (formerly BBPS), becoming the first bank in India to go live with this initiative. The solution leverages Axis Bank’s robust API banking stack and offers a seamless, scalable and customizable platform for B2B payments.

Business-to-Business (B2B)

B2B, short for business-to-business, refers to commercial transactions and interactions between two or more businesses, rather than transactions with individual consumers. It involves the exchange of products, services, or information between companies, where one acts as a supplier or provider to another. 

• Definition:B2B describes commerce where businesses sell products or services to other businesses, not directly to end-users. 
• Examples:
  • A manufacturer selling raw materials to a factory. 
  • A software company selling software to another company. 
  • A wholesaler selling goods to a retailer. 
  • A marketing agency providing services to a business. 

Key Features of the B2B Collections Solution

• Seamless Integration: Integrates with various ordering apps across FMCG, Pharma, Automotive, and Healthcare sectors
• Direct Payments: Enables retailers to initiate invoice payments directly from their ordering application
• Biller Operating Unit: Axis Bank functions as the Biller Operating Unit providing this service
• API-Powered Platform: Built using Axis Bank’s agile, scalable corporate API infrastructure

About Axis Bank

• Branches: 5,706 domestic branches (including extension counters)
• ATMs: 14,476 across India
• Reach: Present in 3,122 centres nationwide
• Group Entities: Includes Axis Mutual Fund, Axis Securities, Axis Finance, Axis Trustee, Axis Capital, A.TReDS, Freecharge, Axis Pension Fund, and Axis Bank Foundation

This partnership marks a significant milestone in India’s digital payment evolution by introducing a first-of-its-kind B2B invoice payment and financing platform, enhancing the efficiency of collections for corporates and their distributors.

BS

Economy

1. India, Tariffs, and Trump

Context

U.S. President Donald Trump’s imposition of reciprocal tariffs on various countries including India has triggered economic unease globally. In response, India has engaged in tariff cuts and bilateral negotiations. But should India go further and reduce tariffs more broadly, even unilaterally? Economists Ajay Shah and Laveesh Bhandari weigh in during a discussion moderated by Prashanth Perumal J.

Do Tariffs Hurt Economic Growth?

Key Takeaway:
There is a strong consensus that lower tariffs promote economic efficiency and consumer welfare.

• Laveesh Bhandari (LB): Tariffs distort economic incentives and hurt consumers. Lowering tariffs enhances efficiency and global competitiveness.
• Ajay Shah (AS): Heterogeneous tariffs cause greater distortions. Even when tariffs are necessary, fewer and more uniform rates are better for efficiency.

Should Tariff Policy Prioritize Consumers?

AS’s Argument:
High tariffs increase consumer prices and shield uncompetitive domestic producers.

• Example: A 20% car duty inflates a ₹5 lakh car to ₹6 lakh, burdening consumers and rewarding inefficiency.
• Core idea: India should focus on sectors where it holds global competitiveness, importing the rest.

Trump’s Tariffs: Strategic Tool or Economic Weapon?

LB: Trump’s approach, though aggressive, was perhaps the only viable tool with WTO’s ineffectiveness.
AS: The end goal of Trump’s tariffs remains ambiguous. Targeting all countries, including allies like India, may have long-term disruptive effects without a clear resolution strategy.

Are Reciprocal Tariffs Effective in Changing Global Behavior?

LB:

• WTO is ineffective; Trump’s aggressive strategy was perhaps the only practical alternative.
• Expected to soften after early gains materialize.

AS:

• Blames China’s systemic distortions for undermining the global trade order.
• Trump’s wide-target approach lacks clarity and predictability, risking global production efficiency.

The Hidden Challenge: Non-Tariff Barriers

LB:

• Non-tariff barriers (NTBs) are rampant and opaque, existing across nearly all sectors.
• These include quality standards, regulatory benchmarks, and administrative delays.

AS:

• NTBs are harder to quantify and often masquerade as quality or safety requirements.
• Example: EU’s strict sanitary standards for grape imports — formally equal but practically burdensome.

How Should India Respond Strategically?

LB:

• India should reduce tariffs gradually, with clear long-term timelines to allow industry adaptation.

AS:

• Cites Yashwant Sinha’s phased tariff liberalization as a model.
• Predictable, gradual tariff reductions can boost investment and confidence.
• Advocates for comprehensive FTAs with the U.S., EU, U.K., and Japan to unlock competitive pressure and global access.

A Path Forward for India’s Trade Policy

India must balance domestic competitiveness, consumer welfare, and strategic autonomy in its tariff decisions. The U.S. approach under Trump may lack long-term clarity, but it has catalyzed long-overdue questions around India’s own protectionist tendencies. Moving toward uniform, lower tariffs, supported by bilateral agreements and transparent non-tariff practices, could unleash a new era of efficiency and global integration for India.

BS

2. Micro, Small, and Medium Enterprises: New Definitions and Their Impact

Context:

The Union government, through a notification dated 21 March, has amended the definitions of micro, small, and medium enterprises (MSMEs). The updated definitions raise the thresholds for investment in plant and machinery and turnover, effective from this financial year.

Implications of the Changes

• Reclassification Benefits: Many medium-sized enterprises will now fall under the ‘small enterprise’ category.
• Access to Government Benefits: This reclassification grants broader access to:
  • The Government e-Marketplace (GeM) for procurement.
  • Dispute resolution services for delayed payments.

Legal Context Under the Micro, Small, and Medium Enterprises Development (MSMED) Act of 2006, only micro and small enterprises previously qualified for benefits like dispute resolution through the Micro and Small Enterprises Facilitation Councils (MSEFCs). Medium enterprises were excluded.

Addressing Delayed Payments

• Chronic Issue: Delayed payments have been a persistent issue, especially for micro and small firms dealing with larger corporations.
• Expanded Access to Redressal: With the new definitions, more firms can now seek arbitration, conciliation, and mediation via MSEFCs.
• Current Status: Out of ₹28,398 crore in pending dues from 92,794 cases, MSEFCs have resolved 50,507 cases amounting to ₹8,740 crore (as of 12 March), according to the Samadhaan portal.

Boost in Market Access

• Under the Public Procurement Policy, all ministries and PSUs must source at least 25% of their needs from micro and small enterprises.
• With redefined categories, more MSMEs can participate in government procurement via GeM.

Government’s Broader Vision Finance Minister Nirmala Sitharaman, in the Union Budget 2025–26, emphasized that expanding MSME definitions would:

• Enhance scale efficiencies
• Support technological upgrades
• Improve access to capital

Mint

Agriculture

1. India’s Agro and Seafood Exports Face Mixed Impact from U.S. Tariffs

Context:

India’s agricultural exports, particularly seafood, may face short-term setbacks due to the U.S. administration’s newly imposed 27% reciprocal tariffs. However, experts believe India’s relatively lower tariff rate compared to its competitors could provide resilience and even opportunity in the long run.

Impact on Seafood Exports

• India exported approximately $1.9 billion worth of seafood to the U.S. in FY24, with Vannamei shrimp making up a significant portion.
• Previously, shrimp exports to the U.S. attracted around 8% in duties; the new rate may raise this to 45%, including countervailing duties.
• Major Indian competitors in seafood like Thailand, Vietnam, and Indonesia now face even higher tariffs, potentially making Indian products more competitive.
• While seafood exporters initially reacted negatively, experts expect prices to adjust in U.S. markets once inventory dips.

Basmati Rice and Other Agricultural Exports

• The U.S. annually imports 300,000–350,000 tonnes of basmati rice from India.
• Other key exports like oilseeds, processed fruits, spices, and cashew may lose ground to countries like Brazil with lower tariffs.
• However, experts expect no lasting negative impact on basmati exports. Short-term volatility may last 2–3 months, after which normalcy is expected.

Agrochemicals Export Resilience

• India exported $5.5 billion worth of agrochemicals globally in FY24, with $1.1 billion sent to the U.S.
• The duty on Indian agrochemicals is 6%, while China now faces 24%, giving Indian exporters a comparative edge.
• Despite India’s higher production costs, the tariff gap is expected to offset pricing disadvantages.

Export Data Snapshot

• Total agri and marine exports in FY24:
  • Agriculture: $38.19 billion
  • Marine: $7.37 billion
  • Marine share in total exports: Approximately 16–19%

While high tariffs from the U.S. pose challenges for India’s seafood and agricultural exports, India’s relatively lower rates compared to competitors could offer a strategic advantage. Short-term disruptions are expected, but exporters remain cautiously optimistic about long-term outcomes.

BS

2. Government Initiatives for Agricultural Mechanization and Digital Transformation

1. Sub-Mission on Agricultural Mechanization (SMAM)

Implemented under Rashtriya Krishi Vikas Yojana (RKVY) by State Governments, SMAM provides financial assistance to farmers for:

• Purchase of agricultural machinery and post-harvest processing equipment on individual ownership basis
• Establishment of Custom Hiring Centres (CHCs) and Farm Machinery Banks (FMBs) for equipment rental
• Demonstration and procurement of Kisan drones for field applications and establishment of drone CHCs

2. Central Sector Scheme – NAMO DRONE DIDI

Aimed at empowering Women Self Help Groups (SHGs) with drone technology:

• Duration: 2023–24 to 2025–26
• Target: Distribution of 15,000 drones to SHGs
• Progress:
  • 1,094 drones distributed by Lead Fertilizer Companies (LFCs) in 2023–24
  • 500 of these distributed under the Namo Drone Didi scheme
  • Remaining 14,500 drones to be delivered by FY 2025–26
• Objective: Sustainable business and livelihood support for women

3. Digital Agriculture Mission (2024–25 to 2025–26)

Launched in September 2024 with an outlay of ₹2,817 crore to create a strong digital ecosystem:

• Key Components:
  • AgriStack: Centralized digital data stack
  • Krishi Decision Support System
  • Comprehensive Soil Fertility and Profile Mapping
  • IT initiatives by Central and State Governments
• AI Innovations:
  • Kisan e-Mitra: AI chatbot for farmer queries on PM-KISAN
  • Real-time AI-based abiotic stress identifier in crops

4. ICAR’s Precision Farming and Drone Research

ICAR institutes are developing advanced tools for smart farming and precision agriculture:

• Drone spraying systems with droplet efficiency studies
• Smart devices and robotic systems developed:
  • Smart sprayers and autonomous weeders
  • Robotic harvesters and variable-rate nitrogen applicators
  • AI-based disease identification devices for crops
  • Poultry feed dispensers and deep fertilizer applicators
  • Spectral and thermal imaging for water stress indices

5. Soil Health & Fertility Scheme (Since 2014–15)

Enhancing soil quality through scientific testing and awareness:

• Soil Health Cards (SHCs) issued: 24.90 crore (as of 31 March 2025)
• Parameters tested: pH, EC, Organic Carbon, N, P, K, S, and micro-nutrients (Zn, Cu, Fe, Mn, B)
• Infrastructure created:
  • 1,068 Static Soil Testing Labs
  • 163 Mobile Labs, 6,376 Mini Labs, 665 Village-level Labs
• Farmer Education:
  • 7 lakh demonstrations
  • 93,781 training programs
  • 7,425 farmer melas
  • 70,002 trained Krishi Sakhis for SHC awareness

Through targeted schemes like SMAM, NAMO DRONE DIDI, the Digital Agriculture Mission, and Soil Health initiatives, the Indian Government is fostering a future-ready farming ecosystem. These initiatives not only support technological integration and women empowerment but also ensure sustainable soil management and precision agriculture for improved productivity and rural livelihoods.

PIB

Facts To Remember

1. Digital lender Kissht prepares for $225 mn IPO

Kissht, an online lending platform, is preparing to tap the capital markets with an initial public offering (IPO) and has hired investment bankers for the process, two people aware of the development told Mint.

2. Respite for rupee as dollar dives

The rupee closed at 85.43 against the dollar, gaining seven paise from 85.50 on Wednesday. It had opened weaker at 86.75 after the US announced higher-than-expected tariffs on Indian imports.

3. Govt approves four Rail projects covering 15 Districts in Maharashtra, Odisha, and Chhattisgarh

The Union Cabinet today approved four projects of the Ministry of Railways with a total cost of 18 thousand 658 crore rupees.

4. India ranks 10th with $1.4 billion private investment in AI: UN

India has been ranked 10th in the world with significant private investments in Artificial Intelligence (AI) in 2023. According to the 2025 Technology and Innovation Report issued by UN Trade and Development (UNCTAD), India ranked 36th in 2024 on the Readiness for Frontier Technologies Index, improving its position from 48th in 2022. 

5. NITI Aayog convenes National Workshop on Mainstreaming Climate Adaptation into Local Development Planning

NITI Aayog convened a National Workshop on ‘Mainstreaming Climate Adaptation into Local Development Planning’ in New Delhi. Policymakers, climate experts, civil society organizations, and development practitioners attended the workshop to explore effective strategies for integrating climate resilience into Panchayat Development Plans.

6. PM Modi attends 6th BIMSTEC Summit; describes forum vital platform for promoting global good

Prime Minister Narendra Modi today underlined that BIMSTEC is an important forum to further global good and stressed the need to strengthen it and deepen engagement. In the 6th BIMSTEC Summit held in Bangkok, the Prime Minister proposed a 21-point Action Plan covering different aspects of cooperation.

7. Hitesh becomes 1st Indian boxer to reach Boxing World Cup 2025 final

Hitesh has become the first Indian boxer to reach the Boxing World Cup 2025 Finals in Foz do Iguaçu, Brazil, today.