Daily Current Affairs (DCA) 5 December, 2025

Daily Current Affairs Quiz
5 December, 2025

National Affairs

1. DHRUVA (Digital Hub for Reference and Unique Virtual Address)

Source: TH

Context:

The Department of Posts has released a draft amendment in 2025 proposing DHRUVA (Digital Hub for Reference and Unique Virtual Address), a UPI-like digital addressing system. This system aims to digitise, standardise, and virtualise physical addresses across India, allowing users to share secure, consent-based address “labels” such as name@entity.

Key Features of DHRUVA

UPI-Like Address Labels

• Each user can obtain a virtual address label, e.g., name@entity, which acts as a proxy for their physical address.
• Reduces the need to repeatedly fill address forms in government and private services.

Consent-Based Access

• Users control who can access their geocoded or textual addresses.
• Access is time-bound and consent-driven, ensuring strong privacy protections.

DIGIPIN Backbone

• DIGIPIN is a 10-character alphanumeric geocode representing latitude–longitude coordinates.
• Maps every 14 sq m patch of India (~228 billion unique pins).
• Open-sourced, precise, and particularly useful for rural and hard-to-map areas.

Address-as-a-Service (AaaS) Framework

• Secure APIs enable integration of address data across:
  • Government agencies
  • Logistics companies
  • E-commerce platforms
  • Fintech and other private-sector services

Aim of DHRUVA

• Create a unified, secure, and user-controlled digital address ecosystem.
• Treat address data as core public infrastructure, similar to Aadhaar, UPI, and DigiLocker.
• Enable Address-as-a-Service (AaaS) for seamless integration across public and private services.

2. Shift in Stubble-Burning Timing in Punjab and Haryana: ISRO

Source: IE

Context:

A new ISRO study has revealed that peak stubble-burning activity in Punjab and Haryana has shifted from early afternoon to early evening between 2020 and 2024, resulting in possible underestimation of farm-fire incidents by government data that rely mainly on polar-orbiting satellites.

Key Findings from the ISRO Study

• Satellites Used:
  • Geostationary: Meteosat Second Generation (MSG) satellites with SEVIRI instrument.
  • Polar-Orbiting (for comparison): NOAA’s Suomi NPP, NASA’s Terra MODIS, Aqua MODIS.
• Significance of Geostationary Satellites:
  • Orbit at ~36,000 km above equator, constantly monitoring the same region.
  • Can detect fire events every half-hour, capturing altered burning times.
• Shift in Burning Practices:
  • Peak burning moved from early afternoon to late afternoon/early evening (3:30–6 pm) since 2022.
  • Shift likely aimed at avoiding detection by polar-orbiting satellites, which monitor fields only at fixed times.
• Implications:
  • Possible undercounting of fire incidents in official records.
  • Affects air quality assessments, emission inventories, and mitigation strategies.
• Publication: “Evidence of shift in stubble burning timing over northwest India from geostationary satellite observations,” Current Science, November 25, 2025.

Government Monitoring and Enforcement

• CAQM Actions:
  • Communicated to Punjab and Haryana for effective elimination of stubble-burning.
  • Requested reports on undetected fire locations, stocktaking methods, and punitive measures.
• State-Level Measures:
  • Punjab deployed 10,500 personnel for round-the-clock monitoring.
  • Supplemented by flying squads from CPCB and CAQM.
  • Created a 1,700-member Parali Protection Force to identify fires escaping satellite detection.
  • Late-evening patrols to catch farmers burning stubble at night.
• Penalties for Violations (CAQM 2025):
  • Small landholders (≤2 acres): ₹5,000 per incident
  • Medium landholders (2–5 acres): ₹10,000 per incident
  • Large landholders (>5 acres): ₹30,000 per incident
• FIRs and Compensation:
  • 1,963 FIRs registered under Section 223 of Bharatiya Nyaya Sanhita, 2023.
  • Environmental compensation imposed: ₹1.26 crore.

Impact on Farm-Fire Incidence

• Punjab (Sep 15–Nov 30):
  • 2020: 83,002 incidents → 2025: 5,114 incidents
• Haryana (Sep 15–Nov 30):
  • 2021: 6,987 incidents → 2025: 662 incidents
• Government Statement: Union Environment Minister Bhupender Yadav reported ~90% reduction in fire incidences in Punjab and Haryana compared to 2022.

3. BNHS to Release Critically Endangered Vultures in Assam

Source: TH

Context:

The Bombay Natural History Society (BNHS) will release six critically endangered vultures—slender-billed (Gyps tenuirostris) and white-rumped (Gyps bengalensis)—into the wild in Assam in January 2026. This is part of India’s ongoing vulture recovery programme, aimed at conserving these species that have faced severe population declines over the past two decades.

Slender-billed Vulture (Gyps tenuirostris)

• Status: Critically Endangered (IUCN) with fewer than ~870 mature individuals.
• Habitat: Gangetic plains, Assam, northern Bangladesh, southern Nepal, Myanmar, and Cambodia. Nests on tall trees near human settlements, slaughterhouses, and riverine areas.
• Key Characteristics:
  • Dark head, slender narrow bill, long bare neck
  • Grey plumage with pale rump; juveniles have white neck down

White-rumped Vulture (Gyps bengalensis)

• Status: Critically Endangered; population declined rapidly due to diclofenac poisoning in livestock carcasses.
• Habitat: Cities, villages, plains, and open fields; nests on large trees or cliffs; often roosts near human habitation.
• Key Characteristics:
  • Dark plumage with white neck ruff and distinct white rump patch
  • White underwing coverts visible in flight

4. New Flight Duty Time Limitations (FDTL) Rules

Source: TOI

Context:

The Indian aviation sector is witnessing large-scale flight cancellations and delays, particularly at IndiGo, following the implementation of Flight Duty Time Limitations (FDTL) rules. The new norms, aimed at reducing pilot fatigue, have led to crew shortages and stricter compliance requirements for airlines.

What Are Flight Duty Time Limitations (FDTL)?

• Definition: Regulatory limits on pilot duty hours, flight hours, night operations, and mandatory rest periods to prevent fatigue.
• Issuing Authority: Directorate General of Civil Aviation (DGCA) under the revised framework notified in January 2024.
• Objective: Align Indian aviation with global safety standards, reduce fatigue-related risks, and ensure safer flight operations.

Key Features of FDTL Rules

• Weekly Rest:
  • 48 hours of continuous rest to allow pilots adequate recovery and reduce cumulative fatigue.
• Night Operations:
  • Night period extended to 00:00–06:00, covering high-fatigue biological windows for early-morning and late-night flights.
  • Limit of two-night landings and two consecutive night duties to prevent performance decline during critical flight phases.
• Roster & Fatigue Management:
  • Airlines must redesign schedules to comply with FDTL.
  • Pilots can formally report fatigue, enhancing transparency and safety.
• Phased Implementation:
  • Fully enforced by November 1, 2025, requiring airlines to expand crew capacity and overhaul existing scheduling practices.

5. Exercise Garuda and Exercise Garuda Shakti

Context:

Two major military exercises were recently in focus:

1. Exercise Garuda 25 between India and France concluded in France.
2. Exercise Garuda Shakti 2025 between India and Indonesia commenced in Himachal Pradesh.

These exercises aim to strengthen bilateral defence cooperation, enhance interoperability, and expose forces to advanced operational tactics.

Exercise Garuda 25

• Host: Air Base 118, Mont-de-Marsan, France
• Participating Nations: India (Indian Air Force – IAF) and France (French Air & Space Force – FASF)
• Key Features:
  • Deployment of Su-30MKI, IL-78 air-to-air refuellers, and C-17 Globemaster III by IAF.
  • Complex missions including strike, escort, air refuelling, and coordinated operations.
  • Joint mission planning, tactical execution, and familiarisation with each other’s standard operating procedures (SOPs).
  • High aircraft serviceability ensured through IAF maintenance teams.

Exercise Garuda Shakti 2025

• Host: Special Forces Training School, Bakloh, Himachal Pradesh
• Participating Nations: India (PARA SF) and Indonesia (Indonesian Special Forces)
• Key Features:
  • Training on counter-terrorism tactics, unarmed combat, combat shooting, sniping, and heliborne operations.
  • Focus on drone warfare, counter-UAS, and loiter-munition planning in semi-mountainous terrain.
  • Exchange of expertise on weapons, equipment, and operational procedures.
  • Culminates in a validation exercise simulating real-operation scenarios to test readiness.

Banking/Finance

1. RBI Cuts Repo Rate to 5.25%

Source: Mint

Context:

The Reserve Bank of India (RBI) reduced the repo rate by 25 basis points (bps) to 5.25%, citing a rare macroeconomic situation where growth is strong and inflation is exceptionally low. The move surprised sections of the market that expected the Monetary Policy Committee (MPC) to hold rates.

Why the Repo Rate Was Cut

1. Benign and Rapidly Falling Inflation

• Average CPI inflation for July–September fell to 1.7%, dipping below the 2% lower tolerance band for the first time since India adopted the inflation-targeting framework.
• October CPI was at 0.3%, signalling sharp disinflation.
• RBI revised FY26 inflation forecast downward to 2% (earlier 2.6%).

2. Robust GDP Growth

• GDP grew 8.2% in Q2 FY26 — the fastest in six quarters.
• RBI raised FY26 GDP forecast to 7.3% from 6.8%.
• Growth is resilient though some indicators like PMI and IIP show early moderation.

3. Policy Space + Low Inflation = Opportunity

Governor Sanjay Malhotra termed this a “rare goldilocks period” where inflation is low and growth is stable, enabling policy action to support momentum.

Impact of the Repo Rate Cut

1. Impact on Banks

• NIM Compression:
  • 63% of floating loans are linked to repo/external benchmarks.
  • Loan rates fall immediately, but deposit rates reprice slowly → NIM squeezes.
• Weak deposit growth means banks may need to raise deposits, not cut rates.
• Bond portfolios gain as yields fall.

2. Impact on Borrowers

• Cheaper EMIs on:
  • Home loans
  • Auto loans
  • Personal loans
• Corporates benefit from lower working capital and long-term borrowing costs.

3. Impact on Economy

• Lower borrowing costs boost consumption and investment.
• Liquidity infusion supports credit flow, especially MSMEs and housing.
• Helps revive sectors showing early signs of slowdown (PMI, IIP softening).

4. Impact on Inflation

• Minimal near-term risk because inflation is already at multi-year lows.
• Some demand-led price pressure may emerge by mid-FY27.

What is Repo Rate?

Repo Rate is the rate at which the RBI lends short-term money to commercial banks against government securities.

Why Repo Rate Matters

• It is the key monetary policy rate.
• Determines borrowing costs for banks → influences loan rates (home, auto, personal loans).
• Used to control inflation:
  • High repo = expensive loans = lower inflation
  • Low repo = cheaper loans = support growth

What is Reverse Repo Rate?

Reverse Repo Rate is the rate at which commercial banks park their surplus funds with RBI.

Why It Matters

• Helps RBI absorb excess liquidity from the banking system.
• Used during high liquidity periods to stabilise money markets.
• A higher reverse repo encourages banks to deposit more with RBI rather than lend in the market.

2. LIC Launches New Insurance Plans: Protection Plus and Bima Kavach

Source: TNIE

Context:

The Life Insurance Corporation of India (LIC) has launched two new life insurance plans aimed at providing savings and risk coverage to individuals and their families.

Key Features:

• LIC Protection Plus (Plan 886)
  • A linked savings plan that combines life cover with investment options.
  • Policyholders can pick from investment funds, adjust the sum assured, make top-up payments, and avail partial withdrawals after five years.
  • Entry age: 18 to 65 years; policy term up to 25 years.
  • Type: Non-par, linked, life, individual savings plan
• Bima Kavach
  • A pure risk, non-linked plan offering fixed death benefits.
  • Offers either a level or increasing sum assured, depending on preference.
  • Premium payment options: single, limited, or regular — with coverage potentially lasting up to 100 years.
  • Type: Non-par, non-linked, life, individual, pure risk plan
  • Special Features: Offers lower premium rates for women and non-smokers.

3. Fino Payments Bank Receives RBI Nod to Convert into Small Finance Bank (SFB)

Source: BS

Context:

Fino Payments Bank Ltd. has received ‘in-principle’ approval from the Reserve Bank of India (RBI) to convert into a Small Finance Bank (SFB).

First Payments Bank to Secure SFB Conversion Nod

• Fino becomes the first-ever payments bank eligible for SFB transformation.
• Eligibility achieved after completing five years of operations, as mandated by RBI.
• Fino launched its payments bank services in 2017.

What Conversion to SFB Enables

After full authorization, Fino will be able to:

• Accept higher-value deposits without payments bank limits.
• Start lending activities to individuals, MSMEs, and small businesses.
• Offer loans such as microcredit, agri-loans, business loans, and retail loans.
• Expand branch network—25% must be in unbanked rural centres.
• Operate like mainstream commercial banks but with a focus on underserved segments.

Eligibility to Become a Small Finance Bank (SFB)

As per RBI’s “on-tap” licensing guidelines, the following criteria must be met:

1. Existing Entity Requirements

• Eligible applicants include:
  • Existing Payments Banks,
  • NBFCs,
  • Microfinance Institutions (MFIs),
  • Local area banks,
  • And other resident-owned entities.
• The applicant must be promoted by residents (Indian citizens/companies).
• Foreign shareholding allowed up to 49% automatically, higher requires approval.

2. Operations & Compliance Track Record

• Payments banks must complete minimum 5 years of operations.
• Must show sound financials, profitability path, and clean compliance history.

3. Capital Requirements

• Minimum paid-up capital: ₹200 crore.
• Promoter must contribute at least 40% of the paid-up capital (to be diluted to 26% in 12 years).
• Minimum CRAR of 15% is required post-conversion.

4. Priority Sector & Financial Inclusion Focus

• At least 75% of Adjusted Net Bank Credit (ANBC) must be towards priority sectors.
• At least 50% of loans must be up to ₹25 lakh ticket size.

5. Branch Expansion Rules

• At least 25% of branches must be in unbanked rural centres.

4. Bank Net Interest Margins (NIMs)

Source: BS

Context:

Following the RBI’s repo rate cut of 25 bps in December 2025, scheduled commercial banks are expected to experience further compression in Net Interest Margins (NIMs). This comes amid a high credit-deposit (CD) ratio and slower adjustment of deposit rates compared to lending rates.

Net Interest Margins (NIMs)

Net Interest Margin (NIM) is a key financial metric used in banking that measures how profitable a bank is in terms of generating income from its lending activities relative to the interest it pays on deposits and borrowings.

It tells how effectively a bank is earning from its core business — lending and investing, compared to what it pays out as interest to depositors and lenders.

Formula

NIM = (Interest Earned – Interest Expended) ÷ Average Interest-Earning Assets × 100

• Interest Earned: Income from loans, advances, government securities, investments, etc.
• Interest Expended: Interest paid on deposits, borrowings, and other funding sources.
• Interest-Earning Assets: Loans + advances + investments that generate interest.

Why NIMs Matter

1. Indicator of Bank Profitability

Higher NIM means the bank earns more margin from lending versus what it pays on deposits.

2. Reflects Efficiency of Banking Operations

Shows how well a bank manages its interest rate risk, asset–liability mix, and pricing strategy.

3. Impacts Overall Net Profit

A bank with stronger NIMs usually reports better Net Interest Income (NII) and stronger bottom-line growth.

5. RBI Tightens Rules for Foreign Banks to Reduce Concentration Risk

Source: Mint

Context:

The Reserve Bank of India (RBI) has introduced stricter norms for foreign banks operating in India by tightening exposure rules under the Large Exposures Framework (LEF). The amendments aim to curb concentration risk, ensure greater transparency, and strengthen the risk management practices of foreign lenders.

Key Changes:

No More Exemptions for Overseas Branch Exposures

• Indian branches of foreign banks can no longer exclude exposures to their head office, overseas branches, or subsidiaries under earlier exemption interpretations.
• These exposures must now be treated as regular counterparty exposures and brought fully under LEF limits.

Stricter Intragroup Exposure Rules

• Foreign banks must comply with tighter intragroup exposure limits, preventing excessive reliance on the parent entity or overseas network.
• This ensures that Indian branches maintain independent risk buffers and avoid concentrated exposures.

Gross Basis Calculation for All Transactions

• All transactions between Indian branches of foreign banks and their overseas affiliates must be calculated on a gross basis, regardless of central clearing.
• No netting will be allowed, making risk assessment more conservative and transparent.
• This change reduces the possibility of understating counterparty risk.

Effective Date and Early Adoption

• The revised norms will come into effect on 1 April 2026.
• RBI has allowed foreign banks to voluntarily adopt the framework earlier if they wish.

Why RBI Tightened the Rules

• To curb concentration risk arising from heavy dependence on head-office funding.
• To align with global best practices in cross-border banking risk management.
• To ensure foreign institutions maintain strong local buffers and risk discipline within Indian operations.

6. Large Exposures Framework (LEF)

Large Exposures Framework (LEF) is an RBI regulation designed to limit the concentration of credit risk in the banking system. It ensures that banks do not take excessively large exposures to a single borrower or a group of connected borrowers.

It aligns India with the Basel Committee on Banking Supervision (BCBS) global standards on large exposures.

Objectives of LEF

• Reduce systemic risk from large borrower defaults
• Prevent excessive concentration of lending
• Ensure banks diversify their credit portfolios
• Strengthen overall financial stability

Key Definitions

Exposure

Includes funded, non-funded credit limits, derivatives exposure, off-balance-sheet items, and investments in securities.

Connected Counterparties

Two or more borrowers treated as a single counterparty if they are interconnected through:

• Control (ownership, voting rights, management)
• Economic interdependence (common sources of funds, guarantees, group dependence)

Exposure Limits under LEF

1. Single Counterparty Exposure Limit

• 20% of a bank’s Tier-1 capital
• RBI may allow up to 25% for certain banks in specific conditions.

2. Group of Connected Counterparties

• 25% of a bank’s Tier-1 capital
• Can be raised to 30% by RBI in exceptional cases.

3. Exposure to NBFCs

• Banks may have exposure up to 25% of Tier-1 capital (Prudential norms announced earlier).

4. Exceptions

Certain exposures are exempt from LEF, such as:

• Exposure to Government of India
• Exposure backed by equivalent cash margins or government guarantees
• Intraday interbank exposures

Recent Update: Withdrawal of 2016 Large Borrower Framework

In December 2025, RBI scrapped the old 2016 guidelines that required large borrowers to raise a portion of their borrowings through the corporate bond market.

• Industry feared bond market volumes would fall.
• RBI clarified volumes are strong due to broader reforms; old rules added costs.

This affects how banks manage exposures under LEF but does not dilute LEF limits, which remain fully in force.

LEF Applicability to Foreign Banks

Foreign banks operating in India (branches of overseas banks) must also comply with LEF based on their India operations only.

1. Exposure Limit Calculation

For foreign banks, the limit is calculated using:

• Tier-1 capital / net owned funds in India, not the global balance sheet.

2. Group-Level Limits

Even if the global parent finances the same borrower elsewhere, only India books count towards LEF.

3. No Exemptions for Foreign Banks

Foreign banks must follow the same exposure caps as domestic banks, except for:

• Foreign sovereign exposures (e.g., home-country government bonds) are exempt outside India but not relevant for India books.
• Branch-level exposures in India cannot exceed LEF limits even if the parent guarantees it.

4. Exposure Aggregation

All Indian branches of a foreign bank are treated as a single entity.
Example:
If a foreign bank has 3 branches in India, their combined exposure to Reliance Group must stay within the 25% group exposure limit.

5. Special Case: Interbank Exposures

Foreign banks with large corporate treasuries often rely on:

• Interbank exposure
• Nostro/Vostro balances
• Forex derivatives

Intraday exposures are exempt, but end-of-day exposures are counted.

Agriculture

1. World Soil Day 2025

Source: TH

Context:

World Soil Day, observed annually on December 5, highlights the importance of soil—a critical yet often overlooked foundation of life and human civilisation. The 2025 theme, “Healthy Soils for Healthy Cities”, shifts focus from rural agriculture to urban environments, underlining the essential role of soil in building resilient cities.

Why Urban Soil Matters:

With over 56% of the global population living in cities, urban soils provide indispensable ecosystem services:

1. Climate Regulation: Soils under vegetation reduce heat in urban “heat islands,” sequester carbon, and mitigate climate change.
2. Flood Management: Healthy soils absorb rainwater, prevent flooding, and recharge groundwater, unlike impervious surfaces.
3. Urban Food Systems & Biodiversity: Fertile soils support rooftop gardens, parks, and community farms while sustaining microbes, pollinators, and earthworms.
4. Mental & Physical Health: Exposure to soil-rich green spaces reduces stress and promotes physical activity.

Challenges:

Urban soils are among the most degraded natural resources. They face:

• Contamination from industrial waste
• Compaction from construction
• Loss of organic matter
• Sealing by concrete and asphalt

These issues threaten food safety, urban ecosystems, and city livability.

Blueprint for Action:

The 2025 campaign emphasizes community and institutional engagement to restore and protect urban soils:

• Soil Restoration: Rehabilitate degraded lands with compost, organic amendments, and soil testing; limit further soil sealing.
• Green Infrastructure: Integrate soils in parks, rain gardens, and tree belts to combat flooding and heat stress.
• Urban Agriculture: Encourage community, backyard, and container gardening.
• Responsible Soil Management: Minimise chemical inputs, plant native species, and protect topsoil with mulching.
• Soil Literacy & Composting: Schools and households can conduct soil workshops and compost organic waste to enrich urban soil.

Facts To Remember

1. Ex-Mizoram Governor Swaraj Kaushal dies

Swaraj Kaushal, former Governor of Mizoram and and a senior advocate, passed away on Thursday afternoon. He was 73.

2. India in Talks with Eight More Countries to Expand UPI Acceptability

India is expanding the global footprint of its Unified Payments Interface (UPI). Currently, UPI is accepted in eight countries: Bhutan, Singapore, Qatar, Mauritius, Nepal, UAE, Sri Lanka, and France.

3. India to Host 20th UNESCO Intangible Cultural Heritage Committee Session at Red Fort

India will host the 20th session of the Inter-governmental Committee for the Safeguarding of the Intangible Cultural Heritage-ICH from 8th till 13th of this month at Red Fort in New Delhi. 

4. Indian Army Hosts Inno-Yoddha 2025 to Promote Soldier-Led Innovation

The Indian Army today conducted its annual Idea and Innovation Competition and Seminar, Inno-Yoddha 2025 in New Delhi. 

5. Lok Sabha Passes Health & National Security Cess Bill

The Lok Sabha has passed the Health Security se National Security Cess Bill, 2025. 

6. 14th round of India-Oman Strategic Consultative Group meeting takes place in Muscat, Oman

The 14th round of the India-Oman Strategic Consultative Group meeting was held on December 4, 2025, in Muscat, Oman.