Daily Current Affairs (DCA) May 10&11, 2026

Daily Current Affairs Quiz
10&11 May, 2026

National Affairs

1. India Hosts ISO International Subcommittee Meetings on ‘Space Systems and Operations’ for the First Time

Source: PIB

Context of the News:

The Bureau of Indian Standards (BIS) — India’s National Standards Body and a founding member of the International Organisation for Standardisation (ISO) hosted the 35th Plenary and Working Groups meetings of ISO/TC 20/SC 14, the ISO subcommittee on Space Systems and Operations, in New Delhi.

Key Highlights

• Event: 35th Plenary and Working Groups meetings of ISO/TC 20/SC 14 — the ISO subcommittee on Space Systems and Operations.
• Host: Bureau of Indian Standards (BIS) — India’s National Standards Body.
• Venue: New Delhi.
• Participation: 131 delegates from 13 countries, including representatives from ISRO, global space agencies, industry, and academia.
• Key themes: Space sustainability, debris mitigation, and mission safety.
• About ISO:
  • Independent, non-governmental international organisation.
  • Established 23 February 1947.
  • Headquartered in Geneva, Switzerland.
  • Develops voluntary, consensus-based international standards.
  • One member body per country — BIS for India.

About the News

What event did BIS host recently?

The 35th Plenary and Working Groups meetings of ISO/TC 20/SC 14, the ISO subcommittee on Space Systems and Operations, in New Delhi.

What is ISO/TC 20/SC 14?

It is a specialised ISO subcommittee responsible for developing international standards covering the entire lifecycle of space systems — from design and production to launch, operations, and space-based services.

What were the key themes of the 2026 meeting in Delhi?

The focus was on space sustainability, debris mitigation, and mission safety — issues central to the long-term viability of the orbital environment around Earth.

How many countries and delegates participated?

131 delegates from 13 countries, including experts from major space agencies like ISRO, industry leaders, and academic institutions.

Why is India hosting this meeting significant?

It reflects India’s growing global stature in the space sector. India is the world’s fifth-largest space economy, hosts a vibrant private space-tech ecosystem, and is increasingly seen as a credible voice in shaping global space norms — particularly under the Indian Space Policy 2023 and through bodies like IN-SPACe.

Why has space sustainability become a global priority?

Because Earth’s orbital regions — especially Low Earth Orbit (LEO) — are increasingly crowded with active satellites, defunct objects, rocket bodies, and over 1 million debris fragments larger than 1 cm. Collisions can damage operational satellites, and uncontrolled debris growth could trigger the Kessler Syndrome — a chain reaction that could render certain orbits unusable.

Why is the ISO involved in space standards?

Because spaceflight increasingly involves multinational collaboration, private companies, and reusable systems. ISO standards ensure that satellites, launch vehicles, ground systems, and services from different countries are safe, interoperable, and follow shared best practices.

Background Concepts (Q&A)

What is the International Organisation for Standardisation (ISO)?

ISO is an independent, non-governmental international organisation that develops and publishes voluntary, consensus-based international standards. It coordinates national standards bodies across countries to harmonise technical specifications globally.

When and where was ISO established?

ISO was established on 23 February 1947, with headquarters in Geneva, Switzerland. It now has member bodies from over 170 countries.

What is the structure of ISO?

ISO is composed of national standards bodies — one per country (e.g., BIS for India, ANSI for the US, BSI for the UK, DIN for Germany). Standards are developed through technical committees (TCs) and subcommittees (SCs) of experts from member bodies.

Are ISO standards mandatory?

No. ISO standards are voluntary, but they are widely adopted by governments, industries, and businesses worldwide, and often referenced in national laws, contracts, and trade agreements — giving them de facto regulatory force.

What is the Bureau of Indian Standards (BIS)?

BIS is India’s National Standards Body, established under the BIS Act, 2016 (which replaced the BIS Act, 1986). It functions under the Ministry of Consumer Affairs, Food and Public Distribution, and is responsible for standardisation, certification (ISI mark), and quality assurance in India.

What is the “One Nation One Standard” Mission?

A BIS initiative under which BIS standards are positioned as the single, unified national standard across sectors, replacing parallel standards from various government departments — making compliance simpler and trade easier.

What are some well-known ISO standards?

ISO 9000/9001 — Quality Management Systems. ISO 14000 — Environmental Management Systems. ISO 27000/27001 — Information Security Management. ISO 22000 — Food Safety Management. ISO 45001 — Occupational Health and Safety.

What is space debris?

Space debris (or “orbital debris”) refers to defunct human-made objects in space — including spent rocket stages, dead satellites, fragments from collisions, and lost equipment — that pose collision risks to active satellites and crewed missions.

What is the Kessler Syndrome?

A scenario proposed by NASA scientist Donald Kessler in 1978, in which the density of objects in Low Earth Orbit becomes high enough that collisions between objects could cause a cascade of further collisions — exponentially increasing debris and potentially rendering certain orbits unusable for generations.

What international frameworks govern space activities?

The cornerstone is the Outer Space Treaty, 1967, supplemented by the Rescue Agreement (1968), Liability Convention (1972), Registration Convention (1975), and Moon Agreement (1979). Recent additions include UN COPUOS guidelines on Long-Term Sustainability of Outer Space Activities and Space Debris Mitigation Guidelines.

What is ISRO?

The Indian Space Research Organisation, established in 1969, is India’s national space agency under the Department of Space. It conducts satellite launches, space exploration (Chandrayaan, Mangalyaan, Aditya-L1), and develops launch vehicles (PSLV, GSLV, LVM-3).

What is IN-SPACe?

The Indian National Space Promotion and Authorisation Centre, established in 2020 under the Department of Space, is the single-window agency for authorising and regulating private-sector participation in India’s space activities, under the Indian Space Policy 2023.

Practice MCQs

Q1. With reference to the recent meeting hosted by BIS, consider the following statements:

1. It was the 35th Plenary of ISO/TC 20/SC 14, the subcommittee on Space Systems and Operations.
2. It was held in Bengaluru, India.
3. The meeting focused on space sustainability, debris mitigation, and mission safety.
4. 131 delegates from 13 countries participated.

How many of the above statements are correct? (a) Only one (b) Only two (c) Only three (d) All four (e) None

Q2. Consider the following statements about the International Organisation for Standardisation (ISO):

1. It was established on 23 February 1947.
2. It is headquartered in Geneva, Switzerland.
3. It is an inter-governmental organisation under the United Nations.
4. ISO standards are voluntary and consensus-based.

Which of the above are correct? (a) 1, 2 and 4 only (b) 1, 2 and 3 only (c) 2 and 4 only (d) 1 and 4 only (e) All four

Q3. Consider the following statements about the Bureau of Indian Standards (BIS):

1. It is India’s National Standards Body and a member of the ISO.
2. It is established under the BIS Act, 2016.
3. It functions under the Ministry of Consumer Affairs, Food and Public Distribution.
4. It certifies products under the ISI mark scheme.

Which of the above are correct? (a) 1, 2 and 4 only (b) 1, 3 and 4 only (c) 2 and 3 only (d) 1 and 4 only (e) All four

Q4. Consider the following statements about space-related international frameworks and concepts:

1. The Outer Space Treaty, 1967 is the cornerstone of international space law.
2. The Kessler Syndrome refers to a chain reaction of debris collisions that could render certain orbits unusable.
3. IN-SPACe is the single-window agency for private-sector space participation in India.
4. ISRO was established in 1947 along with the founding of ISO.

Which of the above are correct? (a) 1, 2 and 3 only (b) 1, 3 and 4 only (c) 2 and 4 only (d) 1 and 4 only (e) All four

Answer Key

1. (c) — Statements 1, 3, 4 are correct. Statement 2 is wrong; the meeting was held in New Delhi, not Bengaluru.
2. (a) — Statements 1, 2, 4 are correct. Statement 3 is wrong; ISO is an independent, non-governmental international organisation — it is not a UN body, though it cooperates with UN agencies.
3. (e) — All four statements are correct.
4. (a) — Statements 1, 2, 3 are correct. Statement 4 is wrong; ISRO was established in 1969, not 1947.

Exam Relevance

Exam	Relevance
UPSC Prelims	GS Paper I — International Organisations (ISO, BIS), Science & Technology (Space)
UPSC Mains	GS Paper II — Important International Institutions, India and global standards
UPSC Mains	GS Paper III — Science & Technology (Space, Satellites, Debris), Indigenous Standards
BPSC / State PCS	International Affairs, Science & Technology, Current Affairs
Banking (RBI Gr B, NABARD)	Current Affairs — Standards and Trade
SSC / Insurance / Railway	Static GK on ISO, BIS, ISRO, Outer Space Treaty

2. Hanamkonda’s Kakatiya-era Dance Pavilion Rises Again  

Source: TH

Context:

The Archaeological Survey of India (ASI) has completed the 42-year-long restoration of the 12th-century dance pavilion (Kalyana Mandapam) at the iconic Thousand Pillar Temple in Hanamkonda, part of Warangal city in Telangana. The pavilion had collapsed centuries ago — ransacked during the conquest of Ulugh Khan in 1323–24 and weakened by foundational failure that caused parts of the structure to sink into the ground.

Key Highlights

• Restored monument: The dance pavilion (Kalyana Mandapam) of the Thousand Pillar Temple, Hanamkonda, Warangal, Telangana.
• Restoration agency: Archaeological Survey of India (ASI).
• Duration: 42 years of restoration work.
• Technique used: Indigenous Kakatiya-era sandbox technology — a cushion-based ancient foundation system.
• Temple type: A Trikutalaya, dedicated to Lord Shiva, Vishnu, and Surya Deva.
• Built by: King Rudra Deva of the Kakatiya dynasty in 1163 AD.
• Style: Chalukya style of architecture, with a distinctive star-shaped (stellate) plan.
• Highlight features: Monolithic Nandi made of black basalt; richly carved pillars whose vertical carvings give the impression of “thousand pillars.”
• Historical event: Originally damaged during the conquest of Ulugh Khan (later Sultan Muhammad bin Tughlaq) in 1323–24.
• Sandbox technology is also used in other Kakatiya sites including the UNESCO-listed Ramappa Temple.

About the News

What did the ASI recently complete?

The 42-year-long restoration of the Kalyana Mandapam (dance pavilion) of the 12th-century Thousand Pillar Temple in Hanamkonda, Warangal city, Telangana.

Why was the restoration so challenging?

Because the pavilion had not just been ransacked centuries ago but had also sunk into the ground due to foundational failure, requiring its complete dismantling and reconstruction — stone by stone — using the same ancient techniques originally employed by Kakatiya engineers.

What technique was used in the restoration?

The original Kakatiya-era sandbox technology — an indigenous geotechnical method where the foundation is a sand-filled pit (mixed with lime, jaggery, and karakkaya/black myrobalan) on which the heavy stone structure rests.

Who built the Thousand Pillar Temple and when?

The temple was constructed in 1163 AD by the Kakatiya ruler Rudra Deva.

Why is it called a “Trikutalaya”?

Because it has three shrines under a single roof, dedicated to a triad of deities — Lord Shiva, Vishnu, and Surya Deva (the Sun God).

What is unique about the temple’s design?

It is built in the Chalukya style of architecture with a striking star-shaped (stellate) plan, richly carved pillars, and a monolithic Nandi sculpture made of a single block of black basalt — recently restored with its complete tail and folded leg.

Why is the temple called the “Thousand Pillar” Temple?

Not because there are literally a thousand pillars, but because many of the columns have vertical carvings and grooves that create the visual impression of multiple smaller pillars within each.

What happened to the temple historically?

The dance pavilion was damaged during the conquest of Ulugh Khan (later Muhammad bin Tughlaq) in 1323–24, when the Kakatiya kingdom fell to the Delhi Sultanate. The pavilion lay in ruins for centuries.

Why is this restoration significant?

It is both a major heritage conservation milestone and an important demonstration that medieval Indian engineering techniques — like sandbox technology — remain functional, durable, and worth preserving as living engineering traditions.

Background Concepts

What is the Archaeological Survey of India (ASI)?

The ASI is the principal organisation for archaeological research and conservation of cultural heritage in India. Established in 1861 by Sir Alexander Cunningham, it functions under the Ministry of Culture and is responsible for protecting monuments, conducting excavations, and maintaining sites of national importance under the Ancient Monuments and Archaeological Sites and Remains Act, 1958.

Who were the Kakatiyas?

The Kakatiya dynasty ruled large parts of present-day Telangana and Andhra Pradesh from the 12th to 14th centuries, with their capital at Warangal (Orugallu). They are known for promoting Telugu language and culture, vibrant temple architecture, irrigation infrastructure (tanks), and the use of advanced engineering techniques. Notable rulers include Rudra Deva, Ganapati Deva, Rani Rudrama Devi, and Prataparudra II.

What is the Chalukya style of architecture?

The Chalukyas (and later Hoysala, Kakatiya) developed the Vesara style of temple architecture — a hybrid between the Nagara (North Indian) and Dravidian (South Indian) styles. Features include intricately carved pillars, star-shaped (stellate) plans, ornate ceiling work, and elaborate sculptural detailing.

What is a Trikutalaya?

A Trikutalaya is a temple with three shrines (“kuta” = peak/shrine; “alaya” = temple), typically dedicated to three deities. The Thousand Pillar Temple’s Trikutalaya enshrines Shiva, Vishnu, and Surya — symbolising the harmony of three principal Hindu traditions.

What is Kakatiya sandbox technology?

An ancient geotechnical engineering technique where a stone temple is built on a sand-filled pit instead of a hard-rock foundation. The pit is filled with a mixture of sand, lime, jaggery, and karakkaya (black myrobalan fruit) — acting as a natural shock-absorbing cushion. It provides earthquake resistance, durability, and is cost-effective.

Why is sandbox technology earthquake-resistant?

Because vibrations lose their intensity as they pass through the sand cushion before reaching the building. Lab experiments show this can reduce the impact force of vibrations by nearly 60%. Unlike modern rubber-based seismic isolators that wear out within 40 years, sand weathers extremely slowly, helping monuments last centuries.

Which other monument uses sandbox technology?

The Ramappa Temple (also called Rudreswara Temple) in Palampet, Telangana, built by the Kakatiyas in 1213 AD, also uses sandbox technology and was inscribed as a UNESCO World Heritage Site in 2021.

Who was Ulugh Khan?

Ulugh Khan was a general (and later Sultan Muhammad bin Tughlaq) of the Delhi Sultanate under Alauddin Khalji and Ghiyasuddin Tughlaq. He led the 1323–24 campaign that defeated the Kakatiya king Prataparudra II, ending the dynasty and bringing Warangal under Delhi Sultanate control.

What are the major architectural styles of Hindu temples in India?

Nagara (North Indian) — beehive-shaped shikhara. Dravidian (South Indian) — pyramidal vimana, large gopurams. Vesara (Hybrid; Karnataka–Deccan) — combination of Nagara and Dravidian elements, used by Chalukyas, Hoysalas, and Kakatiyas.

What is the significance of Warangal in Indian history?

Warangal was the capital of the Kakatiya dynasty and a major centre of medieval Telugu culture, learning, and architecture. The Warangal Fort, the Kakatiya Toranas, and several temples in the region — including the Thousand Pillar Temple and Ramappa Temple — reflect the dynasty’s architectural and engineering excellence.

Practice MCQs

Q1. With reference to the recently restored Thousand Pillar Temple, consider the following statements:

1. It is located at Hanamkonda in Warangal, Telangana.
2. It was constructed in 1163 AD by Rudra Deva of the Kakatiya dynasty.
3. It is a Trikutalaya dedicated to Lord Shiva, Vishnu, and Surya Deva.
4. The Archaeological Survey of India used modern reinforced cement concrete for the restoration of the dance pavilion.

How many of the above statements are correct? (a) Only one (b) Only two (c) Only three (d) All four (e) None

Q2. With reference to Kakatiya-era sandbox technology, consider the following statements:

1. It is an ancient geotechnical foundation technique.
2. The foundation pit is filled with sand, lime, jaggery, and karakkaya (black myrobalan).
3. The technique provides earthquake resistance by absorbing vibrations.
4. It was developed during the Maurya dynasty.

Which of the above are correct? (a) 1, 2 and 3 only (b) 1, 2 and 4 only (c) 2 and 3 only (d) 1 and 4 only (e) All four

Q3. Consider the following statements about the Kakatiya dynasty:

1. They ruled parts of present-day Telangana and Andhra Pradesh from the 12th to 14th centuries.
2. Their capital was at Warangal (Orugallu).
3. Rani Rudrama Devi was one of the notable rulers of the Kakatiya dynasty.
4. The Kakatiya dynasty fell to the Cholas in the late 13th century.

Which of the above are correct? (a) 1, 2 and 3 only (b) 1, 3 and 4 only (c) 2 and 4 only (d) 1 and 4 only (e) All four

Q4. With reference to Indian temple architecture, consider the following statements:

1. The Nagara style is associated with North Indian temple architecture.
2. The Dravidian style features tall gopurams and pyramidal vimanas.
3. The Vesara style is a hybrid of Nagara and Dravidian styles.
4. The Ramappa Temple in Telangana, built by the Kakatiyas, is a UNESCO World Heritage Site.

Which of the above are correct? (a) 1, 2 and 3 only (b) 1, 3 and 4 only (c) 2 and 4 only (d) 1 and 4 only (e) All four

Answer Key

1. (c) — Statements 1, 2, 3 are correct. Statement 4 is wrong; the ASI used the original Kakatiya-era sandbox technology, not modern reinforced cement concrete.
2. (a) — Statements 1, 2, 3 are correct. Statement 4 is wrong; sandbox technology was developed during the Kakatiya dynasty (12th–14th century), not the Maurya dynasty.
3. (a) — Statements 1, 2, 3 are correct. Statement 4 is wrong; the Kakatiya dynasty fell to Ulugh Khan / Delhi Sultanate (under Muhammad bin Tughlaq) in 1323–24, not the Cholas.
4. (e) — All four statements are correct.

Exam Relevance

Exam	Relevance
UPSC Prelims	GS Paper I — Art & Culture, Ancient/Medieval History, ASI
UPSC Mains	GS Paper I — Indian Heritage and Culture, Temple architecture, Medieval India
UPSC Mains	GS Paper III — Science & Technology (Indigenous knowledge, Geotechnical engineering)
State PCS	Indian History, Art & Culture, Current Affairs
SSC / Insurance / Railway	Static GK on temples, dynasties, ASI

3. 3 Jan Suraksha Schemes: PMSBY, PMJJBY and APY  Completes 11 years 

Context:

On 9 May 2026, three flagship financial-inclusion schemes of the Government of India collectively called the “Jan Suraksha” package completed 11 years of operation. Launched by Prime Minister Narendra Modi on 9 May 2015 in Kolkata, West Bengal, the trio comprises the Pradhan Mantri Suraksha Bima Yojana (PMSBY) for accident insurance, the Pradhan Mantri Jeevan Jyoti Bima Yojana (PMJJBY) for life insurance, and the Atal Pension Yojana (APY) for old-age pension.

Key Highlights

• Schemes: Three “Jan Suraksha” schemes — PMSBY, PMJJBY, APY.
• Launched on: 9 May 2015 at Kolkata, West Bengal, by PM Narendra Modi.
• 11-year milestone: Completed on 9 May 2026.
• Cumulative enrolments (till April 2026):
  • PMJJBY: 27.43 crore.
  • PMSBY: 58.09 crore.
  • APY: 9.04 crore.
• Claims paid (April 29, 2026):
  • PMJJBY: ₹21,512.50 crore across 10,75,625 claims.
  • PMSBY: ₹3,667.52 crore across 1,84,662 claims.
• Scheme types:
  • PMJJBY: Life insurance — death due to any cause; ₹2 lakh cover; premium under ₹2/day.
  • PMSBY: Accident insurance — accidental death/disability; ₹2 lakh cover; premium under ₹2/month.
  • APY: Old-age pension — for unorganised sector workers, managed under the NPS architecture.
• Implementing authorities:
  • PMJJBY: Life Insurance Corporation (LIC) + participating banks/post offices with life insurers.
  • PMSBY: Ministry of Finance through Public Sector General Insurance Companies (PSGICs) and other GIs, in collaboration with banks and post offices.
  • APY: Pension Fund Regulatory and Development Authority (PFRDA) under the National Pension System (NPS).

About the News

What are the three Jan Suraksha schemes?

PMJJBY (Pradhan Mantri Jeevan Jyoti Bima Yojana — life insurance), PMSBY (Pradhan Mantri Suraksha Bima Yojana — accident insurance), and APY (Atal Pension Yojana — pension scheme).

When were these schemes launched?

All three were launched by Prime Minister Narendra Modi on 9 May 2015 in Kolkata, West Bengal.

What was the milestone marked on 9 May 2026?

The schemes completed 11 years of implementation since their launch in 2015.

What is the cumulative enrolment under the schemes?

As of April 2026: PMJJBY — 27.43 crore, PMSBY — 58.09 crore, and APY — 9.04 crore subscribers.

What does PMJJBY offer?

A one-year, renewable life insurance cover for death due to any reason, with a sum assured of ₹2 lakh and a premium of less than ₹2 per day. It is administered by LIC, with participating banks/post offices able to partner with any life insurance company.

What does PMSBY offer?

Accidental death and disability cover up to ₹2 lakh at a premium of less than ₹2 per month. It is administered by the Ministry of Finance and implemented through PSGICs and other general insurance companies in collaboration with banks and post offices.

What does APY offer?

A guaranteed monthly pension between ₹1,000 and ₹5,000 after the age of 60, depending on the subscriber’s contribution. It targets the poor, underprivileged, and unorganised-sector workers aged 18–40 and is managed by the PFRDA under the NPS architecture.

How much has been paid out so far?

As of 29 April 2026: ₹21,512.50 crore under PMJJBY for over 10.75 lakh claims; ₹3,667.52 crore under PMSBY for over 1.84 lakh claims.

What role did Jan Dhan Yojana play in these schemes?

The Pradhan Mantri Jan Dhan Yojana (PMJDY), launched in 2014, brought hundreds of millions of unbanked Indians into the formal banking system. These bank accounts became the delivery channel for the three Jan Suraksha schemes, enabling auto-debit of premiums and direct claim transfers.

Why are these schemes considered transformative?

Because they made life insurance, accident insurance, and pension coverage affordable and accessible to the bottom of the pyramid — bringing crores of informal workers into the social-security net for the first time in Indian history.

Background Concepts

What is PMJJBY?

The Pradhan Mantri Jeevan Jyoti Bima Yojana is a government-backed term life insurance scheme available to individuals aged 18–50 years holding a savings bank account. It provides a ₹2 lakh cover in case of death due to any reason, at an annual premium of about ₹436 (auto-debited from the bank account).

What is PMSBY?

The Pradhan Mantri Suraksha Bima Yojana provides accidental death and disability insurance to individuals aged 18–70 years with a savings bank account. It offers ₹2 lakh cover at an annual premium of about ₹20 — making it among the cheapest such products globally.

What is APY?

The Atal Pension Yojana is a pension scheme for unorganised-sector workers aged 18–40 years, providing a guaranteed monthly pension of ₹1,000 to ₹5,000 after age 60. Contributions vary based on the entry age and desired pension. It is managed under the NPS architecture by PFRDA.

What is PMJDY?

The Pradhan Mantri Jan Dhan Yojana, launched in August 2014, is India’s flagship financial inclusion programme aimed at providing universal access to banking. Account-holders get a basic savings account, RuPay debit card, accident insurance, and overdraft facility — and these accounts are the foundation for delivering Jan Suraksha and DBT-based welfare.

What is the JAM trinity?

The combination of Jan Dhan accounts, Aadhaar identity, and Mobile connectivity — used as a unified platform for delivering subsidies, social-security benefits, and financial services directly to beneficiaries with minimal leakage.

Who is PFRDA?

The Pension Fund Regulatory and Development Authority is a statutory body established under the PFRDA Act, 2013, to regulate and promote pension funds in India, including the National Pension System (NPS) and APY.

What is the National Pension System (NPS)?

The NPS is a defined-contribution pension scheme open to all Indian citizens (including private and informal sector workers). Contributions are invested in pension funds, and at retirement, subscribers receive a portion as lump sum and the rest as annuity. APY is a sub-scheme within the NPS framework targeting low-income workers.

Who is LIC?

The Life Insurance Corporation of India is India’s largest life insurer, established in 1956 through nationalisation of life insurance. It is the administrator of PMJJBY and partners with banks/post offices for enrolment and claim settlement.

Why is social security important in India?

Because over 80% of India’s workforce is in the informal/unorganised sector, lacking traditional employer-based pension, health, and life-cover benefits. Schemes like Jan Suraksha provide a basic social-protection floor for this large vulnerable population.

What are PSGICs?

Public Sector General Insurance Companies — the four state-owned non-life insurers (New India Assurance, National Insurance, Oriental Insurance, United India Insurance) that implement PMSBY along with private general insurers.

Practice MCQs

Q1. With reference to the Jan Suraksha schemes, consider the following statements:

1. PMSBY, PMJJBY, and APY were launched by PM Modi on 9 May 2015 in Kolkata.
2. PMJJBY provides life insurance cover for death due to any reason.
3. APY is managed by the Insurance Regulatory and Development Authority of India (IRDAI).
4. PMSBY offers accidental death and disability cover of up to ₹2 lakh.

How many of the above statements are correct? (a) Only one (b) Only two (c) Only three (d) All four (e) None

Q2. With reference to the Pradhan Mantri Jeevan Jyoti Bima Yojana (PMJJBY), consider the following statements:

1. It provides a sum assured of ₹2 lakh.
2. The eligible age is 18–50 years.
3. It is administered by the Life Insurance Corporation of India (LIC).
4. The premium under the scheme is less than ₹2 per month.

Which of the above are correct? (a) 1, 2 and 3 only (b) 1, 2 and 4 only (c) 2 and 4 only (d) 1 and 4 only (e) All four

Q3. With reference to the Atal Pension Yojana (APY), consider the following statements:

1. It is managed by the Pension Fund Regulatory and Development Authority (PFRDA).
2. It operates under the National Pension System (NPS) architecture.
3. It is open to subscribers aged 18 to 40 years.
4. It offers a guaranteed monthly pension between ₹1,000 and ₹5,000 after age 60.

Which of the above are correct? (a) 1, 2 and 4 only (b) 1, 3 and 4 only (c) 2 and 3 only (d) 1 and 4 only (e) All four

Q4. Consider the following statements about financial inclusion initiatives in India:

1. PMJDY was launched in 2014 to provide universal access to banking.
2. The JAM trinity refers to Jan Dhan, Aadhaar, and Mobile.
3. PSGICs are the four public-sector general insurance companies that implement PMSBY.
4. LIC was established in 1956 through the nationalisation of life insurance.

Which of the above are correct? (a) 1, 2 and 3 only (b) 1, 3 and 4 only (c) 2 and 4 only (d) 1 and 4 only (e) All four

Answer Key

1. (c) — Statements 1, 2, 4 are correct. Statement 3 is wrong; APY is managed by PFRDA, not IRDAI. IRDAI regulates the insurance sector but not pensions.
2. (a) — Statements 1, 2, 3 are correct. Statement 4 is wrong; the PMJJBY premium is less than ₹2 per day (₹436 per year), not per month. PMSBY is the one with the under-₹2-per-month premium.
3. (e) — All four statements are correct.
4. (e) — All four statements are correct.

Exam Relevance

Exam	Relevance
UPSC Prelims	GS Paper I — Indian Economy (Government schemes, Financial inclusion, Social security)
UPSC Mains	GS Paper II — Welfare schemes, Issues relating to development and management of Social Sector
BPSC / State PCS	Indian Economy, Social Sector schemes, Current Affairs
Banking (RBI Gr B, SBI PO, IBPS, NABARD)	Financial Awareness, Banking Schemes — high importance
Insurance / LIC AAO / IRDAI	Core area — Jan Suraksha, PMJJBY, PMSBY, APY
SEBI / PFRDA Officers	Pension & financial inclusion architecture
SSC / Railway / CAPF	Static GK on schemes, launch dates, eligibility

4. India Aircraft Leasing and Financing Summit (IALFS 2.0)

Source: PIB

Context:

In May 2026, Gujarat Chief Minister Bhupendra Patel inaugurated the 2nd edition of the India Aircraft Leasing and Financing Summit (IALFS 2.0) at the Gujarat International Finance Tec-City (GIFT City) in Gandhinagar. The summit, organised by the Ministry of Civil Aviation (MoCA) in partnership with the International Financial Services Centres Authority (IFSCA) and the Federation of Indian Chambers of Commerce & Industry (FICCI), is part of a strategic push to position GIFT City as a global hub for aircraft leasing and financing an industry historically dominated by Ireland and Singapore.

Key Highlights

• Event: India Aircraft Leasing and Financing Summit (IALFS 2.0).
• Inaugurated by: Bhupendra Patel, Chief Minister of Gujarat.
• Venue: GIFT City, Gandhinagar, Gujarat.
• Presided by: Union Civil Aviation Minister Ram Mohan Naidu Kinjarapu.
• Organised by: Ministry of Civil Aviation (MoCA), in partnership with IFSCA and FICCI.
• Key projection: India to become the world’s 3rd-largest civil aviation market by 2035, with a fleet of nearly 2,250 aircraft.
• New announcement: Seaplane operations to soon commence in the Union Territory of Lakshadweep.
• Report released: “Advancing the aircraft leasing ecosystem in India — From reforms to powering future growth” by KPMG in partnership with MoCA and FICCI.
• MoUs signed among: IFSCA, FICCI, Air India, IndiGo, Star Air, Bank of India (BoI), and Akasa Air.

About the News

What is the IALFS 2.0?

The India Aircraft Leasing and Financing Summit, 2nd edition — a high-level industry conclave aimed at promoting India, and specifically GIFT City, as a global hub for aircraft leasing and aviation financing.

Who inaugurated the summit, and where?

It was inaugurated by Bhupendra Patel, Chief Minister of Gujarat, at GIFT City, Gandhinagar.

Who organised the summit?

The Ministry of Civil Aviation (MoCA), in partnership with the International Financial Services Centres Authority (IFSCA) and the Federation of Indian Chambers of Commerce & Industry (FICCI).

Who presided over the summit?

Union Civil Aviation Minister Ram Mohan Naidu Kinjarapu, who heads the Ministry of Civil Aviation.

What is India’s projected position in global aviation by 2035?

India is expected to become the world’s third-largest civil aviation market by 2035, with a projected fleet size of around 2,250 aircraft.

What announcement was made regarding Lakshadweep?

The Minister announced that seaplane operations will soon commence in the Union Territory of Lakshadweep, boosting connectivity and tourism in the islands.

What report was released?

A report titled “Advancing the aircraft leasing ecosystem in India — From reforms to powering future growth,” prepared by KPMG in partnership with MoCA and FICCI.

Which agreements were signed at the summit?

Multiple Memorandums of Understanding (MoUs) were signed among IFSCA, FICCI, Air India, IndiGo, Star Air, Bank of India, and Akasa Air, aimed at deepening cooperation in aircraft leasing, financing, and airline development.

Why is aircraft leasing important?

Most airlines globally lease, rather than own, the majority of their fleet, since aircraft are extremely capital-intensive and have long economic lives. Aircraft leasing companies provide access to fleet capacity, optimise capital efficiency, and manage residual-value risk for airlines.

Why is India pushing to build an aircraft leasing hub in GIFT City?

To reduce reliance on Ireland (Dublin) and Singapore — the dominant global hubs — and bring revenue, jobs, and financial expertise onshore. GIFT City’s IFSC offers tax incentives, regulatory clarity (under IFSCA), and a dollar-denominated transaction environment, making it competitive with global hubs.

Background Concepts

What is GIFT City?

The Gujarat International Finance Tec-City in Gandhinagar is India’s first International Financial Services Centre (IFSC). It is designed to host international financial services (banking, insurance, capital markets, aircraft and ship leasing) within Indian territory under a separate, globally aligned regulatory regime.

What is IFSCA?

The International Financial Services Centres Authority is a unified statutory regulator for financial products and services in IFSCs, established in 2020 under the IFSCA Act, 2019. It subsumes the regulatory powers of RBI, SEBI, IRDAI, and PFRDA within IFSCs like GIFT City.

What is aircraft leasing?

Aircraft leasing is an arrangement in which a lessor (typically a leasing company) gives an aircraft to a lessee (airline) for use over a defined period in exchange for periodic payments. It includes operating leases (short to medium term; lessor retains ownership and residual value) and finance leases (long-term; lessee assumes most risks and benefits of ownership).

What is “Project Rupee Raftaar”?

A government initiative aimed at developing the aircraft leasing and financing ecosystem in India, particularly through GIFT City — by addressing taxation, regulatory, and operational barriers that previously pushed Indian airlines to lease from offshore hubs.

What is the role of the Ministry of Civil Aviation (MoCA)?

MoCA is responsible for formulation and implementation of policies for aviation in India, including airport infrastructure, air-traffic services, airlines regulation, and international air transport. Its attached/subordinate bodies include the DGCA, AAI, BCAS, and DGCA-recognised training institutes.

What is the DGCA?

The Directorate General of Civil Aviation is the regulatory body under MoCA, responsible for civil aviation safety, licensing of pilots and engineers, registration of aircraft, and enforcement of air safety standards in India.

What is the UDAN scheme?

Ude Desh ka Aam Naagrik is the regional connectivity scheme launched in 2017 by MoCA to make air travel affordable and widespread, especially in tier-2 and tier-3 cities. It has connected dozens of unserved and underserved airports with capped fares for select seats.

Who are the major airlines in India?

The major airlines include IndiGo (market leader), Air India (now under the Tata Group, with Vistara and AirAsia India merged into it), SpiceJet, Akasa Air (launched 2022), and regional carriers like Star Air.

What is a seaplane operation?

A seaplane is an aircraft capable of taking off from and landing on water. Seaplane operations expand connectivity to remote, island, or water-bordered destinations — useful for tourism in places like Lakshadweep, Andaman & Nicobar Islands, and Kerala backwaters.

Why are Ireland and Singapore dominant aircraft leasing hubs?

Because of their favourable tax treaties, regulatory clarity, legal certainty, financial-services ecosystem, and skilled talent pools. Ireland (Dublin) is home to many of the world’s largest aircraft lessors and accounts for a huge share of global aircraft leasing.

Practice MCQs

Q1. With reference to the India Aircraft Leasing and Financing Summit 2.0 (IALFS 2.0), consider the following statements:

1. It was inaugurated by Gujarat CM Bhupendra Patel.
2. It was held at GIFT City, Gandhinagar.
3. It was organised by the Ministry of Civil Aviation in partnership with IFSCA and FICCI.
4. Union Civil Aviation Minister Ram Mohan Naidu Kinjarapu presided over the summit.

How many of the above statements are correct? (a) Only one (b) Only two (c) Only three (d) All four (e) None

Q2. With reference to GIFT City and the IFSCA, consider the following statements:

1. GIFT City is India’s first International Financial Services Centre (IFSC).
2. IFSCA was established in 2020 as a unified statutory regulator for IFSCs.
3. IFSCA subsumes the powers of RBI, SEBI, IRDAI, and PFRDA within IFSCs.
4. GIFT City is located in Mumbai, Maharashtra.

Which of the above are correct? (a) 1, 2 and 3 only (b) 1, 2 and 4 only (c) 2 and 3 only (d) 1 and 4 only (e) All four

Q3. Consider the following statements about India’s civil aviation sector:

1. India is projected to become the world’s third-largest civil aviation market by 2035.
2. IndiGo is the largest domestic airline by market share.
3. Akasa Air was launched in 2022.
4. The Directorate General of Civil Aviation (DGCA) functions under the Ministry of Finance.

Which of the above are correct? (a) 1, 2 and 3 only (b) 1, 3 and 4 only (c) 2 and 4 only (d) 1 and 4 only (e) All four

Q4. With reference to aircraft leasing, consider the following statements:

1. Ireland and Singapore are major global aircraft leasing hubs.
2. Project Rupee Raftaar aims to develop India’s aircraft leasing ecosystem.
3. Operating leases and finance leases are the two major types of aircraft lease arrangements.
4. Aircraft leasing is fully restricted in India’s IFSCs.

Which of the above are correct? (a) 1, 2 and 3 only (b) 1, 2 and 4 only (c) 2 and 4 only (d) 1 and 4 only (e) All four

Answer Key

1. (d) — All four statements are correct.
2. (a) — Statements 1, 2, 3 are correct. Statement 4 is wrong; GIFT City is located in Gandhinagar, Gujarat, not Mumbai.
3. (a) — Statements 1, 2, 3 are correct. Statement 4 is wrong; DGCA functions under the Ministry of Civil Aviation, not the Ministry of Finance.
4. (a) — Statements 1, 2, 3 are correct. Statement 4 is wrong; aircraft leasing has been permitted and actively promoted in IFSCs (notably GIFT City) under the IFSCA framework — not restricted.

Exam Relevance

Exam	Relevance
UPSC Prelims	GS Paper I — Indian Economy (Aviation, GIFT City, IFSCA, Government schemes)
UPSC Mains	GS Paper III — Infrastructure (Airports, Aviation), Mobilisation of resources, Financial markets
Banking (RBI Gr B, SBI PO, IBPS, NABARD)	Financial Awareness — Aviation Finance, IFSC
SEBI / IFSCA Grade A	Core area — IFSC, aircraft leasing, financial regulation
CA / CFA / CS	Aircraft leasing structures, IFSC tax regime
SSC / Insurance / Railway	Static GK on GIFT City, IFSCA, aviation regulators, airlines

5. Agni-6 Missile

Source: TOI

Context:

The Defence Research and Development Organisation (DRDO) successfully conducted a flight trial of an advanced Agni series missile from A.P.J. Abdul Kalam Island, Odisha. This is the second major successful demonstration of Multiple Independently Targeted Re-entry Vehicle (MIRV) technology by India (following the ‘Mission Divyastra’ in 2024), solidifying India’s position in a select group of nations—including the US, Russia, China, France, and the UK—that possess this strategic capability.

Key Highlights of the Trial

• MIRV Technology: The missile successfully deployed multiple payloads (warheads) to separate, spatially distributed targets in the Indian Ocean Region.
• Precision Tracking: The entire trajectory was monitored by ground and ship-based telemetry stations from lift-off to the impact of all individual payloads.
• Strategic Reach: The trial confirmed that India can now neutralize multiple strategic targets across a large geographical area using a single launch vehicle.
• Indigenous Success: The project involved collaboration between DRDO, the Indian Army, and domestic industry partners, furthering the “Aatmanirbhar Bharat” initiative in defense.

About the News

Q1: From where was the advanced Agni missile test-fired?

A: The test was conducted from the A.P.J. Abdul Kalam Island (formerly Wheeler Island) off the coast of Odisha.

Q2: What is the primary purpose of the MIRV system confirmed in this trial?

A: The MIRV system allows a single missile to carry several warheads, each capable of being directed to a different target at different locations simultaneously, rather than a single warhead hitting a single target.

Q3: How was the mission’s success verified by the Defence Ministry?

A: Success was verified via flight data from multiple ground and ship-based tracking stations that monitored the trajectory until the impact of all payloads, confirming that all mission objectives were met.

Background Concept

Q1: What is a Multiple Independently Targeted Re-entry Vehicle (MIRV)?

A: MIRV is a missile payload containing several warheads. Once the main missile reaches the edge of space, it releases a “bus” (post-boost vehicle) that maneuvers and releases individual warheads at different times and angles to hit multiple, widely separated targets.

Q2: Why is MIRV technology considered a “force multiplier”?

A: It is a force multiplier because it makes missile defense systems (like interceptors) much less effective. An enemy would need multiple interceptors to stop just one MIRV-equipped missile, as each warhead must be tracked and destroyed separately.

Q3: What are the different variants of the Agni missile family?

A: The Agni family ranges from Agni-I (700-900 km range) to Agni-V (intercontinental range of over 5,000 km). They are solid-fuel, surface-to-surface ballistic missiles that form the backbone of India’s nuclear triad.

Multiple Choice Questions (MCQs)

1. The “Mission Divyastra” and the recent May 2026 Agni trial are associated with which specific technology?

A) Stealth Propulsion

B) Hypersonic Glide Vehicles

C) Multiple Independently Targeted Re-entry Vehicle (MIRV)

D) Satellite Anti-Jamming

E) Submarine-Launched Ballistic Missile (SLBM)

2. Which organization is primarily responsible for the design and development of the Agni missile series?

A) ISRO

B) HAL

C) DRDO

D) BDL

E) Ordnance Factory Board

3. In the context of the recent test, where were the targets for the multiple payloads located?

A) Bay of Bengal

B) Arabian Sea

C) Indian Ocean Region

D) Thar Desert

E) South China Sea

4. How many countries (including India) are currently recognized to possess functional MIRV technology?

A) 3

B) 6

C) 10

D) 15

E) 4

Answers

1. C (MIRV)
2. C (DRDO)
3. C (Indian Ocean Region)
4. B (6 — USA, Russia, China, UK, France, and India)

Exam Relevance

Exam Body	Relevance & Application
UPSC (CSE)	GS Paper III: Science & Technology—Developments and their applications and effects in everyday life; Indigenization of technology; Internal Security.
RBI Grade B	General Awareness: Static and current facts about India’s defense breakthroughs and strategic assets.
NABARD Grade A	General Awareness: National news, specifically focusing on self-reliance in critical technology sectors.
SSC (CGL/CHSL)	General Awareness: Facts about Agni missiles, MIRV full form, testing locations (Odisha), and DRDO leadership.
Defence Exams (CDS/AFCAT)	Specialized Knowledge: Technical specifications of Agni missiles and strategic implications of MIRV for the Indian Armed Forces.

6. Survey Records 143 Odonata Species Across Western Ghats

Source: TH

Context:

A major two-year scientific survey of Odonata (dragonflies and damselflies) across the Western Ghats has revealed an alarming gap in biodiversity — researchers documented only about 65% of the historically known species, pointing to a potential 35% shortfall in this ecologically critical group. Conducted by a team led by Dr. Pankaj Koparde of MIT-World Peace University, Pune, the study spanned 144 sites across five states (Maharashtra, Kerala, Karnataka, Goa, and Gujarat) between February 2021 and March 2023.

Key Highlights

• Study: Two-year survey of Odonata (dragonflies and damselflies) across the Western Ghats.
• Duration: February 2021 to March 2023.
• Sites covered: 144 sites across 5 states — Maharashtra, Kerala, Karnataka, Goa, Gujarat.
• Lead researcher: Dr. Pankaj Koparde, Assistant Professor, MIT-World Peace University, Pune.
• Key finding: Only 65% of historically known Odonata species could be recovered — suggesting a ~35% shortfall in current diversity.
• Species recorded: 143 species — 76 dragonflies + 67 damselflies.
• Endemic species: 40 endemic to the Western Ghats.
• State-wise breakdown:
  • Maharashtra: 105 sites, 100 species, 12 endemics.
  • Kerala: 14 sites, 33 endemics (highest concentration).
  • Karnataka: 17 sites, 64 species, 6 endemics.
  • Goa: 3 sites, 35 species, 4 endemics.
  • Gujarat: 5 sites, 18 species, 0 endemics.
• IUCN Red List status of 143 species:
  • Least Concern: 100; Data Deficient: 22; Not Evaluated: 16.
  • Near Threatened (2): Phylloneura westermanni, Heliogomphus promela.
  • Vulnerable (3): Elattoneura souteri, Protosticta sanguinostigma, Cyclogomphus ypsilon.
• Endemism pattern: Greater in the Southern Western Ghats (especially Kerala, south of Coorg) due to perennial streams and richer microhabitats.
• Identified threats: Linear infrastructure, hydropower, pollution, land-use change, unregulated tourism, forest fires, and climate change.

About the News

What is the central finding of the survey?

That researchers could document only about 65% of the historically known Odonata species in the Western Ghats — implying a 35% shortfall in current diversity, likely due to species loss and habitat degradation.

Who conducted the study and where?

The study was led by Dr. Pankaj Koparde, Assistant Professor at MIT-World Peace University, Pune, and covered 144 sites across five states in the Western Ghats — Maharashtra, Kerala, Karnataka, Goa, and Gujarat.

Over what period was the survey carried out?

Between February 2021 and March 2023 — a two-year-plus field campaign.

How many Odonata species were recorded?

A total of 143 species — 76 dragonflies and 67 damselflies — of which 40 are endemic to the Western Ghats.

Which state showed the highest endemic diversity?

Kerala — with 33 endemic species across 14 sites, indicating its disproportionate importance for Western Ghats Odonata conservation.

What does the IUCN status breakdown look like?

Of 143 species: 100 are Least Concern, 22 Data Deficient, 16 Not Evaluated, 2 Near Threatened (Phylloneura westermanni, Heliogomphus promela), and 3 Vulnerable (Elattoneura souteri, Protosticta sanguinostigma, Cyclogomphus ypsilon).

Why is the high count of “Data Deficient” species important?

Because 22 species lack enough scientific data to even assess their conservation status — pointing to large gaps in research and the urgent need for more surveys before populations decline irreversibly.

Why are Odonata called “indicator taxa”?

Because they depend on healthy freshwater ecosystems for breeding and are highly sensitive to changes in water quality, temperature, and habitat structure. Their absence often signals deeper ecological stress — pollution, fragmentation, or climate disruption.

What are the main threats identified?

The study lists linear infrastructure development (roads, transmission lines), hydropower projects, severe pollution, large-scale land-use changes, unregulated tourism, recurring forest fires, and climate change as compounding pressures fragmenting and degrading Western Ghats ecosystems.

Why is endemism higher in the southern Western Ghats?

Because of the availability of suitable microhabitats and perennial streams, particularly south of Coorg (Karnataka) and in Kerala — providing year-round freshwater habitats critical for Odonata breeding.

What does the study recommend?

That more intensive, systematic surveys be conducted in unexplored and undersampled parts of the Western Ghats to fill knowledge gaps and accurately assess the status and distribution of Odonata species.

Background Concepts

What are Odonata?

Odonata is an order of carnivorous insects that includes dragonflies (suborder Anisoptera) and damselflies (suborder Zygoptera). They have an aquatic larval stage and adult flight stage, and depend on freshwater habitats throughout their life cycle.

What is the difference between dragonflies and damselflies?

Dragonflies are larger, with broad bodies and wings held flat or open while resting; flight is fast and direct. Damselflies are slender, smaller, and hold their wings folded along their bodies at rest; flight is fluttery.

What are the Western Ghats?

The Western Ghats are a 1,600-km long mountain chain running parallel to India’s western coast through Gujarat, Maharashtra, Goa, Karnataka, Kerala, and Tamil Nadu. They are one of the world’s eight “hottest” biodiversity hotspots, a UNESCO World Heritage Site (since 2012), and home to thousands of plant and animal species, many of them endemic.

Why are the Western Ghats considered a biodiversity hotspot?

Because they (a) contain a significant percentage of the world’s species found nowhere else (high endemism), and (b) have lost a substantial portion of their original habitat to deforestation and development — the two defining criteria of a “hotspot” as proposed by Norman Myers.

What is an “indicator species”?

An indicator species is one whose presence, absence, or population size reflects the ecological health of an ecosystem. Odonata, lichens, frogs, and certain fish are widely used as ecological indicators.

What are the IUCN Red List categories?

From most to least threatened: Extinct (EX), Extinct in the Wild (EW), Critically Endangered (CR), Endangered (EN), Vulnerable (VU), Near Threatened (NT), Least Concern (LC), Data Deficient (DD), Not Evaluated (NE).

What is endemism?

A species is endemic to a region when it is found only in that region and nowhere else in the world. High endemism makes regions like the Western Ghats globally irreplaceable.

Why do freshwater ecosystems matter for Odonata?

Because dragonflies and damselflies lay eggs in or near water, and their larvae (called nymphs) live underwater for months to years — feeding on aquatic prey before metamorphosing into adults. Loss or pollution of streams, ponds, and wetlands devastates their populations.

What is the “Western Ghats UNESCO World Heritage Site”?

In 2012, UNESCO inscribed 39 serial sites across the Western Ghats — spanning Kerala, Tamil Nadu, Karnataka, and Maharashtra — as a natural World Heritage Site, recognising its outstanding universal value as a biodiversity hotspot.

What is the Gadgil Committee and the Kasturirangan Committee?

The Gadgil Committee (2011) and Kasturirangan Committee (2013) were set up to study and recommend protection measures for the Western Ghats. Gadgil proposed protecting about 64% of the Ghats as ecologically sensitive; Kasturirangan reduced this to about 37% ecologically sensitive areas, which became the basis for government policy.

Practice MCQs

Q1. With reference to the recent Odonata survey in the Western Ghats, consider the following statements:

1. The survey recorded 143 species, including 76 dragonflies and 67 damselflies.
2. About 40 of the recorded species are endemic to the Western Ghats.
3. Only 65% of historically known Odonata species could be documented.
4. The study was conducted exclusively in Maharashtra.

How many of the above statements are correct? (a) Only one (b) Only two (c) Only three (d) All four (e) None

Q2. Consider the following statements about Odonata:

1. Odonata includes dragonflies and damselflies.
2. Their larvae are aquatic and depend on freshwater ecosystems.
3. They are considered “indicator taxa” of ecological health.
4. Dragonflies and damselflies are categorised under the same suborder.

Which of the above are correct? (a) 1, 2 and 3 only (b) 1, 2 and 4 only (c) 2 and 4 only (d) 1 and 4 only (e) All four

Q3. With reference to the Western Ghats, consider the following statements:

1. They run parallel to India’s western coast through six states.
2. They are listed as a UNESCO World Heritage Site since 2012.
3. They are recognised as one of the world’s biodiversity hotspots.
4. The Kasturirangan Committee recommended protecting nearly 64% of the Western Ghats as ecologically sensitive.

Which of the above are correct? (a) 1, 2 and 3 only (b) 1, 3 and 4 only (c) 2 and 4 only (d) 1 and 4 only (e) All four

Q4. With reference to the IUCN Red List, consider the following statements:

1. “Vulnerable” is a higher threat category than “Endangered.”
2. “Data Deficient” indicates that insufficient information exists to assess a species’ status.
3. “Least Concern” indicates that a species faces no significant threat of extinction.
4. The Red List is maintained by the International Union for Conservation of Nature.

Which of the above are correct? (a) 2, 3 and 4 only (b) 1, 2 and 4 only (c) 1 and 4 only (d) 1, 3 and 4 only (e) All four

Answer Key

1. (c) — Statements 1, 2, 3 are correct. Statement 4 is wrong; the study covered five states — Maharashtra, Kerala, Karnataka, Goa, and Gujarat — not just Maharashtra.
2. (a) — Statements 1, 2, 3 are correct. Statement 4 is wrong; dragonflies (Anisoptera) and damselflies (Zygoptera) belong to different suborders within the order Odonata.
3. (a) — Statements 1, 2, 3 are correct. Statement 4 is wrong; the Gadgil Committee recommended protecting ~64% of the Ghats. The Kasturirangan Committee reduced this to ~37%.
4. (a) — Statements 2, 3, 4 are correct. Statement 1 is wrong; “Endangered” is a higher threat category than “Vulnerable” — the order from most to least threatened is Critically Endangered → Endangered → Vulnerable → Near Threatened → Least Concern.

Exam Relevance

Exam	Relevance
UPSC Prelims	GS Paper III — Environment, Biodiversity, Conservation, IUCN, Western Ghats
UPSC Mains	GS Paper III — Biodiversity, Conservation, Environmental Degradation, Climate Change
UPSC Mains	GS Paper I — Indian Geography (Western Ghats)
BPSC / State PCS	Environment, Geography, Current Affairs
Banking (RBI Gr B, NABARD)	ESI / Environment & Sustainability
Forest Services (IFoS)	Core area — species, conservation status, ecological indicators
Geography / Zoology / Environment Optional	Biogeography, conservation biology, taxonomy

Banking/Finance

1. RBI Imposes Penalties on YES Bank, Hinduja Housing Finance

Source: ET

Context:

In May 2026, the Reserve Bank of India (RBI) imposed a total monetary penalty of ₹33.60 lakh on two regulated entities YES Bank Limited and Hinduja Housing Finance Limited for lapses in regulatory compliance. YES Bank was fined ₹31.80 lakh for non-compliance with Know Your Customer (KYC) norms, specifically for failing to use KYC identifiers from the Central KYC Records Registry (CKYCRR) while opening customer accounts. Hinduja Housing Finance was fined ₹1.80 lakh under Section 52A of the National Housing Bank Act, 1987 for non-compliance with RBI directions on governance.

Key Highlights

• Action by: Reserve Bank of India (RBI).
• Total penalty imposed: ₹33.60 lakh.
• YES Bank Limited:
  • Penalty: ₹31.80 lakh.
  • Reason: Non-compliance with KYC norms — failed to use KYC identifiers assigned by the Central KYC Records Registry (CKYCRR) for establishing account-based relationships with customers.
• Hinduja Housing Finance Limited:
  • Penalty: ₹1.80 lakh.
  • Reason: Non-compliance with RBI directions related to governance.
  • Legal basis: Section 52A of the National Housing Bank (NHB) Act, 1987.
• Underlying theme: RBI’s continuous supervisory action to enforce KYC, AML/CFT discipline, and governance norms across banks and HFCs.

About the News (Q&A)

What action did the RBI take?

The RBI imposed a combined monetary penalty of ₹33.60 lakh on two entities — YES Bank Limited (₹31.80 lakh) and Hinduja Housing Finance Limited (₹1.80 lakh) — for regulatory compliance lapses.

Why was YES Bank penalised?

For failing to comply with certain provisions of the RBI’s Know Your Customer (KYC) Directions — specifically for not implementing a system of using KYC identifiers assigned by the Central KYC Records Registry (CKYCRR) when establishing account-based relationships with customers.

Why was Hinduja Housing Finance penalised?

For failing to comply with certain RBI directions relating to governance, under Section 52A of the National Housing Bank Act, 1987.

What is the Central KYC Records Registry (CKYCRR)?

The CKYCRR is a centralised repository of KYC records of customers in the financial sector. Once a customer’s KYC is verified by any regulated entity, the records are stored centrally — so other regulated entities can use the same KYC information without duplicating the process, using a unique KYC Identifier.

Why is using CKYC identifiers important?

It avoids duplication of KYC efforts, ensures uniformity and accuracy of customer information, and supports AML/CFT compliance. Failure to use CKYC identifiers undermines the integrity of the centralised KYC architecture.

What is Section 52A of the NHB Act, 1987?

It empowers the RBI (which took over HFC regulation from the National Housing Bank in 2019) to impose monetary penalties on housing finance companies that fail to comply with directions or provisions of the Act.

Is RBI’s action unusual?

No — the RBI routinely conducts statutory inspections of regulated entities and imposes penalties for procedural lapses. Such actions are typically not based on customer transactions but on systemic compliance gaps identified during supervisory inspections.

What is the broader message of these penalties?

That the RBI maintains a strong enforcement posture on KYC, AML/CFT, and governance norms — applicable to all regulated entities, regardless of size or sector — to safeguard the integrity of India’s financial system.

Background Concepts

What is KYC (Know Your Customer)?

KYC is a process by which financial institutions verify the identity and address of their customers before opening accounts or conducting transactions. It is a key tool to prevent money laundering, tax evasion, fraud, and terrorist financing.

What is the legal basis for KYC in India?

KYC norms are derived from the Prevention of Money Laundering Act (PMLA), 2002 and the PML (Maintenance of Records) Rules, 2005, operationalised through RBI’s Master Direction on KYC, 2016 (amended periodically).

What is the Central KYC Records Registry (CKYCRR)?

The CKYCRR is operated by the Central Registry of Securitisation Asset Reconstruction and Security Interest of India (CERSAI) — a government-owned entity under the Ministry of Finance. It stores KYC records of customers across the financial sector and assigns each customer a unique 14-digit KYC Identifier (KIN).

What is the role of CERSAI?

CERSAI was established under the SARFAESI Act, 2002 to maintain registries of asset securitisation, asset reconstruction, and security interests. In 2016, it was designated as the operator of the CKYCRR.

What is the National Housing Bank (NHB)?

NHB was established in 1988 under the NHB Act, 1987 to regulate and supervise housing finance companies (HFCs) and promote housing finance institutions. It was wholly owned by the RBI until 2019, when ownership was transferred to the Government of India.

Who regulates Housing Finance Companies (HFCs) now?

Following amendments in the Finance (No. 2) Act, 2019, regulatory powers over HFCs were transferred from NHB to RBI in 2019. NHB continues to play a supervisory and developmental role, but RBI is now the primary regulator.

What is YES Bank?

YES Bank is a private-sector scheduled commercial bank in India, founded in 2004. It was reconstructed in 2020 following a financial crisis, with State Bank of India (SBI) leading a consortium of banks to revive it.

What is Hinduja Housing Finance?

Hinduja Housing Finance Limited is a housing finance company (HFC) and subsidiary of Hinduja Leyland Finance, part of the Hinduja Group. It provides housing loans, particularly in semi-urban and rural areas.

What are AML and CFT?

AML — Anti-Money Laundering: Measures to prevent the conversion of illegally obtained money into legitimate funds. CFT — Combating the Financing of Terrorism: Measures to detect and prevent the use of financial systems for financing terrorism. Both are core compliance priorities under the global Financial Action Task Force (FATF) framework.

What are RBI’s enforcement powers?

The RBI is empowered under the Banking Regulation Act, 1949, the RBI Act, 1934, and sector-specific laws (like the NHB Act, 1987) to inspect, supervise, and impose penalties on regulated entities for non-compliance with statutory provisions and directions.

Practice MCQs

Q1. With reference to the recent RBI penalties on YES Bank and Hinduja Housing Finance, consider the following statements:

1. YES Bank was penalised for non-compliance with KYC norms.
2. Hinduja Housing Finance was penalised under the NHB Act, 1987.
3. The penalty on YES Bank related to failure to use KYC identifiers from the Central KYC Records Registry.
4. The penalties were imposed for fraudulent customer transactions.

How many of the above statements are correct? (a) Only one (b) Only two (c) Only three (d) All four (e) None

Q2. Consider the following statements about the Central KYC Records Registry (CKYCRR):

1. It is operated by CERSAI under the Ministry of Finance.
2. It maintains KYC records of customers across the financial sector.
3. It assigns a unique 14-digit KYC Identifier (KIN) to each customer.
4. It was established under the SARFAESI Act, 2002.

Which of the above are correct? (a) 1, 2 and 3 only (b) 1, 2 and 4 only (c) 2 and 4 only (d) 1 and 3 only (e) All four

Q3. With reference to the regulation of Housing Finance Companies (HFCs) in India, consider the following statements:

1. HFCs are currently regulated primarily by the Reserve Bank of India.
2. The National Housing Bank (NHB) was the sole regulator of HFCs until 2019.
3. Regulatory powers over HFCs were transferred to the RBI through the Finance (No. 2) Act, 2019.
4. The NHB Act, 1987 governs the National Housing Bank.

Which of the above are correct? (a) 1, 2 and 4 only (b) 1 and 3 only (c) 2 and 4 only (d) 1 and 4 only (e) All four

Q4. Consider the following statements about KYC and related frameworks:

1. KYC norms in India are derived from the Prevention of Money Laundering Act (PMLA), 2002.
2. The Financial Action Task Force (FATF) is the global body that sets AML/CFT standards.
3. The RBI’s KYC Master Direction is the operational guidance for banks and financial institutions.
4. The Central KYC Records Registry is operated by the Reserve Bank of India.

Which of the above are correct? (a) 1, 2 and 3 only (b) 1, 3 and 4 only (c) 2 and 4 only (d) 1 and 4 only (e) All four

Answer Key

1. (c) — Statements 1, 2, 3 are correct. Statement 4 is wrong; the penalties were imposed for regulatory compliance lapses identified during supervisory inspections, not for fraudulent customer transactions.
2. (e) — All four statements are correct.
3. (e) — All four statements are correct.
4. (a) — Statements 1, 2, 3 are correct. Statement 4 is wrong; the CKYCRR is operated by CERSAI, not the RBI.

Exam Relevance

Exam	Relevance
UPSC Prelims	GS Paper I — Indian Economy (RBI, Banking Regulation, KYC, AML)
Banking (RBI Gr B, SBI PO, IBPS, NABARD)	Banking Awareness, AML/KYC compliance — high importance
SEBI Grade A	Adjacent area — financial regulation

2. FPI Ownership of Indian Equities Hits 14-year Low as Selling Streak Continues

Source: BL

Context:

Foreign Portfolio Investors (FPIs) have continued to pull money out of Indian equities, withdrawing ₹14,231 crore so far in May 2026, taking the total FPI outflow in 2026 past ₹2 lakh crore — already higher than the ₹1.66 lakh crore pulled out during the entire 2025. As per data from the National Securities Depository Limited (NSDL), FPIs have been net sellers in every month of 2026 except February, when they briefly turned net buyers.

Key Highlights

• FPI outflow in May 2026 (so far): ₹14,231 crore from Indian equities.
• Total 2026 outflow: Over ₹2 lakh crore — already exceeding the ₹1.66 lakh crore pulled out in all of 2025.
• Source: Data from the National Securities Depository Limited (NSDL).
• Drivers of selling:
  • Persistent global macroeconomic uncertainty.
  • Concerns over inflation and interest rates.
  • Geopolitical risks in West Asia and high crude oil prices.
  • Rupee depreciation (near ₹94–95 to USD).
  • Earnings-growth concerns in India.
• Diverting destinations: Strong earnings growth in South Korea and Taiwan, driven by the AI boom.
• Selective FPI buying in India: Power, construction, capital goods; mid- and small-cap stocks with strong fundamentals.

About the News

How much have FPIs withdrawn from Indian equities so far in May 2026?

A total of ₹14,231 crore, taking 2026’s cumulative outflow past ₹2 lakh crore.

How does this compare to 2025?

It is already higher than the ₹1.66 lakh crore pulled out during the entire calendar year 2025, despite 2026 being only about four months in.

Was every month in 2026 a net outflow?

No. February 2026 was the only exception, with a net inflow of ₹22,615 crore — the highest monthly inflow in 17 months. All other months — January, March, April, and May (so far) — have seen net outflows.

Which was the worst month for FPI outflows in 2026?

March 2026, with a record outflow of ₹1.17 lakh crore from Indian equities.

What are the main reasons for these outflows?

Persistent global macroeconomic uncertainty — including concerns over inflation, central bank interest rates, geopolitical tensions (especially West Asia), high crude oil prices, rupee depreciation, and concerns over India’s corporate earnings growth.

Why are South Korea and Taiwan attracting FPI flows?

Because of stronger earnings growth in these markets — driven by the AI boom and demand for semiconductors, components, and high-end electronics that South Korean and Taiwanese companies dominate.

Are FPIs avoiding all Indian sectors?

No. Despite the overall selling, FPIs are selectively investing in sectors such as power, construction, and capital goods, and showing increasing preference for mid-cap and select small-cap stocks with strong fundamentals and growth potential.

What does this trend signal for the Indian rupee?

Sustained FPI outflows put downward pressure on the rupee, contributing to its depreciation to around ₹94–95 against the US dollar and forcing the RBI to dip into forex reserves to defend the currency.

What did experts say about the situation?

Himanshu Srivastava (Morningstar) said global macro concerns — inflation, interest rates, geopolitics — were weighing on emerging-market sentiment. V K Vijayakumar (Geojit) noted that currency depreciation and slowing earnings growth in India have pushed FPI flows to AI-driven markets, but selective buying continues in capex-related and quality mid-cap stocks.

Background Concepts

What are Foreign Portfolio Investors (FPIs)?

FPIs are non-resident investors who invest in Indian financial markets — primarily stocks, bonds, and derivatives — without seeking management control over the companies. They are regulated by SEBI under the SEBI (FPI) Regulations, 2019.

What is the difference between FPI and FDI?

FPI: Portfolio investments in listed securities; investors do not seek management control; investments are typically more liquid and can exit quickly. FDI: Long-term investments where the investor takes a stake (typically 10%+) in an unlisted/listed company and may seek a degree of management control; less volatile and more strategic.

What are the categories of FPIs?

Under SEBI’s FPI Regulations, 2019, FPIs are classified as: Category I FPIs: Government and government-related investors (e.g., sovereign wealth funds, central banks), regulated funds from FATF-member countries, multilateral agencies. Category II FPIs: All other FPIs — including individuals, family offices, and corporate bodies — subject to standard KYC and compliance requirements.

Who regulates FPIs in India?

SEBI is the primary regulator; the RBI oversees the foreign-exchange dimension under FEMA, 1999. The NSDL and CDSL maintain custody and reporting infrastructure.

What is NSDL?

The National Securities Depository Limited, established in 1996, is one of India’s two central securities depositories (along with CDSL). It holds securities in electronic form, enables settlement, and is the primary source of data on FPI flows in India.

Why are FPIs called “hot money”?

Because their flows are highly mobile and respond quickly to global cues like interest rate changes, currency movements, and risk sentiment. Sudden withdrawals can cause sharp market and currency volatility — making emerging markets vulnerable to global shocks.

Why do US interest rates affect FPI flows to India?

Higher US interest rates make US dollar-denominated assets more attractive to global investors, pulling capital back to the US from emerging markets like India. Conversely, when the Fed cuts rates, “carry trade” capital often flows back to higher-yielding emerging markets.

What is the “carry trade”?

A strategy where investors borrow in a low-interest-rate currency (e.g., yen or USD when rates are low) and invest in higher-yielding assets in another country to earn the interest-rate differential.

How do FPI outflows affect the rupee?

When FPIs sell Indian equities/bonds, they convert rupees back into dollars to repatriate funds — increasing demand for dollars and putting downward pressure on the rupee. This often forces the RBI to sell dollars from its forex reserves to limit volatility.

What is the “Impossible Trinity” in this context?

The economic principle that a country can pursue only two of three policy goals at the same time: (1) a fixed exchange rate, (2) free capital flows, and (3) independent monetary policy. India has chosen a managed-float regime that gives it limited freedom on all three.

What are emerging markets (EMs)?

Emerging markets are countries with developing economies that are integrating with the global economy — characterised by rapid growth, evolving institutions, and higher volatility than developed markets. India, China, Brazil, South Africa, Indonesia, and others fall into this category.

Practice MCQs

Q1. With reference to the recent FPI activity in Indian equities, consider the following statements:

1. FPIs have withdrawn ₹14,231 crore from Indian equities in May 2026 (so far).
2. Total FPI outflows in 2026 have crossed ₹2 lakh crore.
3. February 2026 was the only month of 2026 to see net FPI inflows.
4. The data is sourced from the Reserve Bank of India.

How many of the above statements are correct? (a) Only one (b) Only two (c) Only three (d) All four (e) None

Q2. Consider the following statements about FPIs in India:

1. They are regulated by SEBI under the SEBI (FPI) Regulations, 2019.
2. They are classified as Category I and Category II under the current framework.
3. They are typically considered “hot money” because of their mobility.
4. FPIs and FDI investors must always seek management control of investee companies.

Which of the above are correct? (a) 1, 2 and 3 only (b) 1, 2 and 4 only (c) 2 and 3 only (d) 1 and 4 only (e) All four

Q3. With reference to the reasons behind the FPI outflows from India in 2026, consider the following statements:

1. Persistent global macroeconomic uncertainty is one of the key drivers.
2. The AI-led growth boom in South Korea and Taiwan is attracting FPI flows away from India.
3. High crude oil prices and rupee depreciation have weakened FPI sentiment.
4. FPIs have completely exited from Indian power, construction, and capital goods sectors.

Which of the above are correct? (a) 1, 2 and 3 only (b) 1, 3 and 4 only (c) 2 and 4 only (d) 1 and 4 only (e) All four

Q4. Consider the following statements about NSDL and capital flows in India:

1. NSDL is one of India’s central securities depositories.
2. It holds securities in electronic form and enables their settlement.
3. CDSL is the other major depository in India.
4. NSDL was established in 1996.

Which of the above are correct? (a) 1, 2 and 3 only (b) 1, 3 and 4 only (c) 2 and 4 only (d) 1 and 4 only (e) All four

Answer Key

1. (c) — Statements 1, 2, 3 are correct. Statement 4 is wrong; the data is sourced from the National Securities Depository Limited (NSDL), not the RBI.
2. (a) — Statements 1, 2, 3 are correct. Statement 4 is wrong; FPIs do not seek management control (unlike FDI investors). Management control is typically associated with FDI, not FPI.
3. (a) — Statements 1, 2, 3 are correct. Statement 4 is wrong; FPIs have continued to selectively invest in power, construction, and capital goods sectors despite overall selling.
4. (e) — All four statements are correct.

Exam Relevance

Exam	Relevance
UPSC Prelims	GS Paper I — Indian Economy (FPI/FDI, SEBI, Capital Markets)
UPSC Mains	GS Paper III — External Sector, Financial Markets, Mobilisation of Resources
BPSC / State PCS	Indian Economy, Current Affairs
Banking (RBI Gr B, SBI PO, IBPS, NABARD)	Financial Awareness, External Sector — high importance
SEBI Grade A	Core area — FPI regulations, capital flows

3.  Sebi about to nudge the door open for agri-commodities

Context of the News

A working group set up by the Securities and Exchange Board of India (SEBI) has recommended allowing cash settlements up to fixed thresholds in select agricultural commodity derivatives — a potential turning point for India’s long-stagnant farm derivatives market. Currently, physical delivery is mandatory for all farm derivatives, meaning contracts must settle via actual exchange of goods on expiry. While this protects against excessive speculation and keeps prices aligned with real-world supply, it has also kept the segment shallow, especially compared to metals and energy derivatives — which have flourished on policy certainty.

Key Highlights

• Proposal: Cash settlement up to a fixed threshold in select agri commodity derivatives; beyond the threshold, delivery-based settlement continues.
• Recommendation by: A SEBI working group; backed by SEBI’s Commodity Derivatives Advisory Committee.
• Next step: SEBI expected to issue a consultation paper for public feedback.
• Target commodities: “Narrow” agri items like pepper, turmeric, guar, and dhaniya (coriander) — traded on NCDEX.
• Current rule: Physical delivery is mandatory for all farm derivatives, limiting market depth.
• Three categories of agri commodity derivatives:
  • Sensitive — subject to govt. interventions, import-export restrictions, or repeated price manipulation.
  • Broad — not sensitive, with avg deliverable supply ≥ 1 million tonnes and market value ≥ ₹5,000 crore over last 5 years.
  • Narrow — all other agri commodities.
• History: India lifted its four-decade ban on commodity derivatives trading in 2003; NCDEX and MCX both opened that year.

About the News

What has the SEBI working group proposed?

That cash settlement be allowed in select agricultural commodity derivatives up to a fixed threshold; beyond that threshold, contracts would convert to delivery-based settlement.

Why is this significant?

Because farm derivatives currently require mandatory physical delivery, which limits participation and keeps the segment shallow. Permitting cash settlement up to a threshold would attract more traders, deepen liquidity, and improve price discovery.

Which commodities are likely to be covered first?

So-called “narrow” agri commodities such as pepper, turmeric, guar, and dhaniya (coriander) — items traded on NCDEX that are politically less sensitive than essential food staples.

Which body backed the proposal?

SEBI’s Commodity Derivatives Advisory Committee endorsed the working group’s recommendations.

What is the next step?

SEBI is expected to issue a consultation paper for public and stakeholder feedback before finalising any framework.

Why has the segment been struggling?

Farm derivatives have faced repeated bans, suspensions, and policy reversals (notably during inflation spikes), undermining investor confidence. Several contracts in commodities like wheat, paddy, and chana were suspended in earlier years to curb price speculation.

Why have metals and energy derivatives boomed?

Because they are less politically sensitive, more removed from the common consumer, and have benefited from policy certainty — making them attractive to both speculators and hedgers.

How does this proposal balance benefits with risks?

By capping cash settlement at a fixed threshold, the proposal ensures that speculation does not dominate; once the threshold is breached, contracts must be delivery-settled — preserving the alignment between derivative prices and actual physical supply.

What is SEBI Chairman Tuhin Kanta Pandey’s stated approach?

In December, he indicated that the working group was examining whether margins, position limits, and settlement mechanisms could be optimised without compromising market integrity.

What is the broader objective?

To rebuild confidence in India’s commodity derivatives ecosystem and deepen the farm derivatives segment — bringing it closer in scale and sophistication to the metals and energy segment.

Background Concepts

What are commodity derivatives?

Commodity derivatives are financial contracts (such as futures, options, and forwards) whose value is derived from an underlying commodity — like agricultural goods, metals, or energy. They are used for hedging price risk and for speculation.

What is the difference between physical delivery and cash settlement?

In physical delivery, contracts settle by the actual exchange of the underlying commodity between buyer and seller on expiry. In cash settlement, contracts settle through a net cash payment based on the difference between the contract price and the final settlement price — no physical goods change hands.

What is a futures contract?

A standardised exchange-traded contract obligating the buyer to buy (and seller to sell) a specified quantity of an asset at a pre-agreed price on a future date.

What is an options contract?

A contract giving the buyer the right (but not the obligation) to buy (call option) or sell (put option) an underlying asset at a specified price before or on a specified date.

What are the three categories of agri commodity derivatives?

Sensitive: Commodities subject to frequent government interventions (stock limits, import-export restrictions) or repeated price manipulation over the past five years. Broad: Non-sensitive commodities with an average deliverable supply of at least 1 million tonnes and a market value of at least ₹5,000 crore over the last five years. Narrow: All other commodities (smaller volumes; not currently sensitive).

What is the role of SEBI in commodity derivatives?

SEBI took over the regulation of commodity derivatives in September 2015 after the Forward Markets Commission (FMC), the earlier regulator, was merged with SEBI. SEBI now regulates the entire securities and commodity derivatives ecosystem.

What is NCDEX?

The National Commodity & Derivatives Exchange Ltd is India’s leading exchange for agricultural commodity derivatives. It started operations in 2003.

What is MCX?

The Multi Commodity Exchange of India Ltd is India’s largest commodity derivatives exchange, focused mainly on metals and energy (gold, silver, copper, crude oil, natural gas). It also started in 2003.

Why was the four-decade ban on commodity derivatives lifted in 2003?

The original ban was imposed in the 1960s due to concerns over speculation and price manipulation. It was lifted in 2003 as part of broader market liberalisation, with the establishment of national exchanges like NCDEX and MCX.

Who participates in commodity derivatives markets?

Hedgers (farmers, traders, producers seeking to lock in prices), speculators (investors seeking profit from price movements), arbitrageurs (exploiting price differences), and commercial users (manufacturers managing input-cost risk).

Why are agri derivatives more politically sensitive?

Because food prices directly affect inflation, household budgets, and farm incomes. Excessive speculation can lead to volatility that hurts farmers and consumers, prompting frequent regulatory interventions.

What are “position limits” and “margins” in derivatives?

Position limits cap the maximum number of contracts a single trader can hold to prevent market manipulation. Margins are deposits required as collateral to enter futures positions, ensuring traders can meet their obligations.

Practice MCQs

Q1. With reference to the SEBI working group’s proposal on agri derivatives, consider the following statements:

1. The proposal recommends cash settlements up to fixed thresholds for select agri commodities.
2. The proposal applies primarily to “narrow” agricultural commodities.
3. The proposal has been endorsed by SEBI’s Commodity Derivatives Advisory Committee.
4. The proposal mandates cash settlement for all agricultural derivatives.

How many of the above statements are correct? (a) Only one (b) Only two (c) Only three (d) All four (e) None

Q2. Consider the following statements about the classification of agricultural commodity derivatives in India:

1. Sensitive commodities face frequent government interventions and import-export restrictions.
2. Broad commodities have an average deliverable supply of at least one million tonnes.
3. Narrow commodities include items like pepper, turmeric, guar, and dhaniya.
4. All agricultural commodities currently fall under the “broad” category.

Which of the above are correct? (a) 1, 2 and 3 only (b) 1, 2 and 4 only (c) 2 and 4 only (d) 1 and 4 only (e) All four

Q3. Consider the following statements about commodity derivatives regulation in India:

1. SEBI regulates commodity derivatives in India since 2015.
2. The Forward Markets Commission (FMC) was merged with SEBI in 2015.
3. NCDEX primarily focuses on metals and energy derivatives.
4. MCX is India’s largest commodity derivatives exchange.

Which of the above are correct? (a) 1, 2 and 4 only (b) 1, 3 and 4 only (c) 2 and 3 only (d) 1 and 4 only (e) All four

Q4. Consider the following statements about commodity derivatives:

1. Futures contracts obligate buyers and sellers to transact at a pre-agreed price on a future date.
2. Options contracts give the right but not the obligation to buy or sell.
3. Cash settlement involves physical exchange of the underlying commodity.
4. Position limits and margins are tools used to prevent excessive speculation.

Which of the above are correct? (a) 1, 2 and 4 only (b) 1, 2 and 3 only (c) 2, 3 and 4 only (d) 1 and 4 only (e) All four

Answer Key

1. (c) — Statements 1, 2, 3 are correct. Statement 4 is wrong; the proposal does not mandate cash settlement for all agri derivatives — it allows cash settlement only up to a threshold, beyond which delivery-based settlement continues.
2. (a) — Statements 1, 2, 3 are correct. Statement 4 is wrong; agri commodity derivatives are classified into three categories — sensitive, broad, and narrow — not all under broad.
3. (a) — Statements 1, 2, 4 are correct. Statement 3 is wrong; NCDEX focuses on agricultural commodities, while MCX focuses on metals and energy.
4. (a) — Statements 1, 2, 4 are correct. Statement 3 is wrong; cash settlement involves a net cash payment based on price difference — not physical exchange. Physical exchange occurs in delivery-based settlement.

Exam Relevance

Exam	Relevance
UPSC Prelims	GS Paper I — Indian Economy (SEBI, Commodity Markets, Derivatives)
UPSC Mains	GS Paper III — Financial Markets, Mobilisation of Resources, Agricultural Marketing
Banking (RBI Gr B, SBI PO, IBPS, NABARD)	Financial Awareness, Capital Markets — high importance
SEBI Grade A	Core area — SEBI regulations, commodity derivatives, NCDEX, MCX
SSC / Insurance / Railway	Static GK on regulators, exchanges, FMC-SEBI merger
Agricultural / Forest Services exams	Agri marketing, price discovery, hedging mechanisms

4. RBI, European Central Bank sign revised agreement on information exchange, central banking ties

Source: ET

Context of the News

On 10 May 2026, on the sidelines of the Bank for International Settlements (BIS) meetings in Basel, Reserve Bank of India (RBI) Governor Sanjay Malhotra and European Central Bank (ECB) President Christine Lagarde signed a revised Memorandum of Understanding (MoU) on cooperation in the field of central banking. The new agreement updates the previous MoU signed in 2015 and provides a structured framework for information exchange, policy dialogue, and technical cooperation between the two institutions in areas of mutual interest.

Key Highlights

• Event: Signing of revised RBI-ECB MoU on cooperation in central banking.
• Date & Venue: 10 May 2026, on the sidelines of the Bank for International Settlements (BIS) meetings in Basel, Switzerland.
• Scope of cooperation:
  • Regular exchange of information.
  • Policy dialogue between the two central banks.
  • Technical cooperation through joint seminars and workshops on areas of mutual interest.
• Wider context: Comes alongside RBI’s release of the Foreign Exchange Management (Authorised Persons) Regulations, 2026, signalling India’s deeper integration with global financial governance frameworks.

About the News

What did the RBI and ECB sign?

A revised Memorandum of Understanding (MoU) on cooperation in the field of central banking, updating the earlier MoU signed in 2015.

Who signed the agreement and where?

It was signed by Sanjay Malhotra, Governor of the RBI, and Christine Lagarde, President of the ECB, on the sidelines of the Bank for International Settlements (BIS) meetings in Basel, Switzerland, on 10 May 2026.

What does the MoU cover?

It establishes a framework for three pillars of cooperation — regular information exchange, policy dialogue, and technical cooperation (joint seminars and workshops in areas of mutual interest).

What does the MoU replace?

It replaces and updates the 2015 RBI-ECB MoU on central banking cooperation.

What did Lagarde say at the signing?

She underlined the importance of sustaining global cooperation between central banks, saying it was “important that we sustain global cooperation” as a sign of continued dialogue with the RBI.

Why is this MoU significant for India?

It deepens institutional ties with one of the world’s most influential central banks (the ECB manages the euro for the 20-member Eurozone). It signals India’s growing weight in global financial governance, especially as it negotiates trade and strategic partnerships with the EU.

Why is this MoU significant for the ECB?

India is a major emerging market with growing global financial linkages. Cooperation helps the ECB better assess spillover risks, FX dynamics, and emerging-market financial-stability issues that affect the Eurozone.

Where does the BIS fit in?

The MoU was signed on the sidelines of the BIS meetings, where major central bank governors gather periodically. The BIS — often called the “central bank for central banks” — serves as a hub for international monetary and financial cooperation.

Is this related to any other recent RBI announcement?

Yes — separately, the RBI issued the Foreign Exchange Management (Authorised Persons) Regulations, 2026, rationalising the framework for authorised persons in forex transactions.

What broader trend does this reflect?

A growing pattern of bilateral central bank cooperation MoUs as financial systems become more interconnected, capital flows more volatile, and central bank policy spillovers (US Fed, ECB) increasingly affect emerging markets.

Background Concepts

What is the European Central Bank (ECB)?

The European Central Bank, headquartered in Frankfurt, Germany, is the central bank for the Eurozone — the 20 EU member states that have adopted the euro as their currency. Established in 1998 under the Maastricht Treaty, it is responsible for monetary policy in the Eurozone, with its primary mandate being price stability.

What is the Reserve Bank of India?

Established on 1 April 1935 under the RBI Act, 1934, the RBI is India’s central bank. Its functions include issuing currency, conducting monetary policy, regulating banks, managing forex reserves, and acting as banker to the Government. It is headquartered in Mumbai.

What is the Bank for International Settlements (BIS)?

The BIS, headquartered in Basel, Switzerland, was established in 1930 and is often described as the “central bank for central banks.” It hosts regular meetings of central bank governors, sets global standards (e.g., Basel III on capital adequacy), and facilitates monetary and financial cooperation across major economies.

What is an MoU between central banks typically used for?

An MoU is a non-binding framework agreement that allows institutions to cooperate on issues like information exchange, joint research, regulatory dialogue, financial stability, training, and technical assistance — without creating legally enforceable obligations.

What is the Eurozone?

The Eurozone is the monetary union of 20 EU member states that have adopted the euro (€) as their common currency. Monetary policy for the Eurozone is decided by the ECB. Some EU members (such as Denmark, Sweden, Poland) are not part of the Eurozone.

How significant is India-EU economic engagement?

The European Union is one of India’s largest trading partners, accounting for a major share of bilateral goods trade, investment, and technology cooperation. India and the EU are negotiating a free trade agreement (FTA), strategic partnership on connectivity, digital, and green technologies.

Why is central bank cooperation important globally?

In an interconnected financial world, monetary policy decisions in one major economy (US Fed, ECB) can trigger massive capital movements affecting others. Coordination helps central banks share data on cross-border flows, financial stability risks, FX market trends, and prevents miscommunication during periods of stress.

What was the previous 2015 RBI-ECB MoU about?

The 2015 MoU also set up a framework for cooperation, information sharing, and policy dialogue. The 2026 update reflects evolving priorities — including digital payments, cross-border financial supervision, climate-related financial risks, and recent global shocks.

Practice MCQs

Q1. With reference to the recent RBI-ECB Memorandum of Understanding, consider the following statements:

1. It was signed by RBI Governor Sanjay Malhotra and ECB President Christine Lagarde.
2. It was signed on the sidelines of the Bank for International Settlements meetings in Basel.
3. It updates the previous MoU signed in 2015.
4. It is a legally binding treaty between India and the European Union.

How many of the above statements are correct? (a) Only one (b) Only two (c) Only three (d) All four (e) None

Q2. Consider the following statements about the European Central Bank (ECB):

1. It is headquartered in Frankfurt, Germany.
2. It is the central bank for all 27 European Union member states.
3. Its primary mandate is price stability in the Eurozone.
4. Christine Lagarde is its current President.

Which of the above are correct? (a) 1, 3 and 4 only (b) 1, 2 and 3 only (c) 2 and 4 only (d) 1 and 4 only (e) All four

Q3. With reference to the Bank for International Settlements (BIS), consider the following statements:

1. It is headquartered in Basel, Switzerland.
2. It was established in 1930.
3. It is often described as the “central bank for central banks.”
4. It is a specialised agency of the United Nations.

Which of the above are correct? (a) 1, 2 and 3 only (b) 1, 3 and 4 only (c) 2 and 4 only (d) 1 and 4 only (e) All four

Q4. Consider the following statements about the Reserve Bank of India:

1. The RBI was established on 1 April 1935 under the RBI Act, 1934.
2. Sanjay Malhotra is the current Governor of the RBI.
3. The RBI is headquartered in Delhi.
4. The RBI is responsible for issuing currency and managing forex reserves.

Which of the above are correct? (a) 1, 2 and 4 only (b) 1, 3 and 4 only (c) 2 and 3 only (d) 1 and 4 only (e) All four

Answer Key

1. (c) — Statements 1, 2, 3 are correct. Statement 4 is wrong; an MoU is a non-binding framework for cooperation, not a legally binding treaty.
2. (a) — Statements 1, 3, 4 are correct. Statement 2 is wrong; the ECB is the central bank for the 20 Eurozone countries, not all 27 EU members. Some EU members (like Denmark, Sweden, Poland) have not adopted the euro.
3. (a) — Statements 1, 2, 3 are correct. Statement 4 is wrong; the BIS is not a UN specialised agency. It is an independent international financial institution.
4. (a) — Statements 1, 2, 4 are correct. Statement 3 is wrong; the RBI is headquartered in Mumbai, not Delhi.

Exam Relevance

Exam	Relevance
UPSC Prelims	GS Paper I — International Organisations (BIS, ECB), Indian Economy (RBI)
UPSC Mains	GS Paper II — India and bilateral/multilateral institutions, India-EU relations
Banking (RBI Gr B, SBI PO, IBPS, NABARD)	Banking & Economy — high importance
SEBI Grade A	Global Financial Regulation, Cross-border supervision

Facts To Remember

1. Vijay sworn in as CM, vows clean governance

“As I said before, I will not touch even a single paisa of public money. I do not need it. 

2. Lieutenant General NS Raja Subramani (Retd) appointed as Chief of Defence Staff↗

The Government of India has appointed Lieutenant General NS Raja Subramani as the new Chief of Defence Staff (CDS). He will succeed General Anil Chauhan after the latter completes his tenure on 30 May 2026.

3. Gujarat CM Inaugurates India Aircraft Leasing and Financing Summit 2.0

Gujarat Chief Minister Bhupendra Patel inaugurated the second edition of the India Aircraft Leasing and Financing Summit (IALFS 2.0) at GIFT City, Gandhinagar. The summit was organised by the Ministry of Civil Aviation in collaboration with IFSCA and FICCI. Union Civil Aviation Minister Ram Mohan Naidu stated that India is expected to become the world’s third-largest civil aviation market by 2035 with nearly 2,250 aircraft. Several MoUs were signed among aviation companies, financial institutions, and regulatory bodies during the summit.

4. MoHFW Launches JANANI Digital Healthcare Platform

The Ministry of Health and Family Welfare launched the JANANI platform during the National Summit on Innovation and Inclusivity in Chandigarh. The platform is an upgraded version of the Reproductive and Child Health portal and aims to create a longitudinal digital record system for maternal and child healthcare. It supports antenatal care, institutional deliveries, postnatal care, and newborn healthcare services. The system also integrates with U-WIN, POSHAN, and Ayushman Bharat Health Account platforms.

5. Union Government Launches Nationwide Annual Health Check-up Initiative

Union Minister Dr. Mansukh Mandaviya launched a nationwide annual health check-up initiative at ESIC Medical College and Hospital in New Delhi. The programme offers free annual health screening for workers above 40 years of age through ESIC hospitals across India. The initiative focuses on preventive healthcare, early disease detection, and timely medical treatment under the framework of the new labour codes. Treatment and medicines will also be provided through ESIC facilities.

6. CSIR-CRRI and BPCL Develop India’s First Plastic Waste Geocell

CSIR-Central Road Research Institute, in collaboration with Bharat Petroleum Corporation Limited, developed India’s first geocell made entirely from mixed plastic waste named “Phoenix Geocell.” The innovation is designed to improve road durability, soil stabilisation, and slope protection using recycled plastic waste. The project received recognition from the India Book of Records and Asia Book of Records. A pilot project was conducted on the DND–Faridabad–KMP Expressway.

7. IndiaAI and ICMR Sign MoU for AI in Healthcare

IndiaAI under the Ministry of Electronics and Information Technology and the Indian Council of Medical Research signed an MoU to promote responsible use of Artificial Intelligence in healthcare. The collaboration aims to build a unified AI ecosystem for healthcare innovation and public health research. IndiaAI will provide computing infrastructure while ICMR will contribute biomedical expertise and health datasets. The initiative will also support the AIKosh platform for sharing anonymised healthcare datasets.

8. CSIR-NIScPR and RIS Sign MoU for STI Policy Research

CSIR-National Institute of Science Communication and Policy Research signed an MoU with the Research and Information System for Developing Countries to strengthen cooperation in Science, Technology, and Innovation policy research and science diplomacy. The partnership will focus on policy dialogues, joint publications, training programmes, and international cooperation, especially for Global South countries. It also aims to strengthen India’s role in global science governance.

9. Ministry of Finance Empowers GSTAT Principal Bench as NAAAR

The Ministry of Finance empowered the Principal Bench of the Goods and Services Tax Appellate Tribunal in New Delhi to function as the National Appellate Authority for Advance Rulings from April 1, 2026. The authority will resolve disputes involving conflicting GST advance rulings across different states and Union Territories. The move aims to improve consistency and clarity in GST implementation across India.

10. BIS Hosts Global Space Systems Standards Meeting in New Delhi

The Bureau of Indian Standards organised the 35th plenary and working group meetings of ISO Technical Committee 20/Subcommittee 14 on Space Systems and Operations for the first time in India. The event was held at Bharat Mandapam in New Delhi with participation from delegates of 13 countries. Discussions focused on international standards for space system design, launch operations, safety, and sustainability. The event highlighted India’s growing role in the global space sector.

11. RBI Imposes Penalties on YES Bank and Hinduja Housing Finance

The Reserve Bank of India imposed monetary penalties on YES Bank and Hinduja Housing Finance for regulatory compliance lapses. YES Bank was fined Rs 31.80 lakh for deficiencies related to Know Your Customer norms, while Hinduja Housing Finance was penalised Rs 1.80 lakh for governance-related non-compliance. The action was taken under provisions of the Banking Regulation Act and National Housing Bank Act.

12. Government Appoints New CDS and Chief of Naval Staff

The Government of India appointed Lieutenant General NS Raja Subramani as the third Chief of Defence Staff and Secretary of the Department of Military Affairs with effect from May 30, 2026. Vice Admiral Krishna Swaminathan was appointed as the 27th Chief of Naval Staff and will assume office on May 31, 2026. Both appointments are aimed at strengthening India’s military leadership and defence preparedness.

13. Bulgaria Elects Rumen Radev as Prime Minister

The Parliament of Bulgaria elected former President Rumen Radev as the new Prime Minister with majority support in the National Assembly. The development followed the collapse of the previous government in December 2025. Rumen Radev previously served as President of Bulgaria and was also a Major General in the Bulgarian Air Force. His appointment marks a major political transition in the country.

14. Laura Fernández Delgado Sworn in as President of Costa Rica

Laura Virginia Fernández Delgado was sworn in as the 50th President of Costa Rica for the term 2026–2030. She became the second woman in the country’s history to hold the office. Her Sovereign People’s Party secured a majority in the legislature during the 2026 elections. Earlier, she served as Minister of National Planning and Economic Policy.

15. World Thalassaemia Day Observed on May 8, 2026

World Thalassaemia Day was observed globally on May 8 to raise awareness about thalassaemia, a hereditary blood disorder affecting haemoglobin production. The 2026 theme was “Hidden No More: Finding the Undiagnosed. Supporting the Unseen.” The observance is led by the Thalassaemia International Federation and promotes early diagnosis, treatment access, and patient support.

16. Time of Remembrance and Reconciliation Observed on May 8–9

The United Nations observed the Time of Remembrance and Reconciliation for Those Who Lost Their Lives during the Second World War on May 8 and 9, 2026. The observance commemorates victims of World War II and promotes peace, reconciliation, and international cooperation. The year 2026 marked the 81st anniversary of the end of the Second World War.