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GS Paper: GS3

  • SC restricts ‘retrospective’ green clearances

    Why in the News?

    The Supreme Court on 29 July 2026 quashed, with prospective effect, the Centre’s 2021 Office Memorandum (OM) that allowed ex post facto environmental clearances for projects built without prior approval. It held that the government cannot alter the mandatory environmental clearance regime through a mere administrative instruction. The ruling closes a route that had let project proponents regularise unauthorised construction through a recurring “amnesty,” while leaving open a narrow exception issued through proper notification.

    What did the 2021 Office Memorandum allow, and why did the court strike it down?

    1. What the OM did: The 2021 OM created a standard operating procedure allowing perpetual, recurring ex post facto environmental clearance for projects undertaken without prior environmental clearance under the Environment (Protection) Act, 1986.
    2. Why it failed the legal test: The Bench, led by Chief Justice of India Surya Kant, held that the OM was “an administrative order” that “envisages a perpetual regime” and “supplants an earlier delegated legislation through an administrative instruction, which is impermissible in law.”
    3. No selection criteria: The OM applied indiscriminately to all permissible projects without laying down an intelligible differentia connecting selection to “supervening public interest,” making it disproportionate and violative of Articles 14 and 21 of the Constitution.
    4. Weakened deterrence: The decriminalisation of the offence of breaching the prior clearance regime through the Jan Vishwas (Amendment of Provisions) Act, 2023 compounded the problem, since violators earlier faced up to five years’ imprisonment or a fine, before the offence became a civil liability.

    What can the government still do to grant retrospective clearance?

    1. Narrow exception preserved: The Court held the Centre retains power under Section 3 of the Environment (Protection) Act, 1986 to issue an appropriate, narrowly tailored amnesty notification in supervening public interest, as an exception to the 2006 notification, but not through an administrative memorandum.
    2. Selection requirement: Any future amnesty scheme must make a distinct, reasoned selection of projects, tested against proportionality and public interest, rather than covering all non-compliant projects uniformly.
    3. Accountability demand: The Court ordered that future amnesty schemes must provide effective deterrent measures against individual public servants, including disciplinary action and personal liability, wherever the state or its own instrumentalities violate the prior clearance regime.

    What happens to projects that already received clearance under the quashed OM?

    1. Prospective effect only: The Court quashed the 2021 OM prospectively, to avoid disrupting ongoing projects including the AIIMS Medical College and Hospital building in Odisha, the Centre of Excellence for Cancer Diseases in Tamil Nadu, Vijayapura Airport in Karnataka, and various medical colleges, slum rehabilitation and irrigation projects.
    2. Existing clearances remain valid: Retrospective clearances already granted under the 2017 notification and the 2021 OM remain valid unless individually challenged in accordance with law.
    3. Litigation history: The ruling follows a back-and-forth: a May 2025 Division Bench judgment called such clearances a “gross illegality,” a November 2025 larger Bench recalled that ruling citing the “devastating effect” on public projects worth thousands of crores, and the present July 2026 judgment on review petitions restores the stricter position on the OM specifically.

    Does closing the OM route resolve the tension between environmental compliance and project continuity?

    1. Unresolved incentive: Because existing ex post facto clearances remain valid unless individually challenged, project proponents that already built without clearance retain the benefit of past regularisation, even as the route for future violators is closed.
    2. Enforcement gap remains: With the 2023 Jan Vishwas Act having decriminalised breaches of the prior clearance regime, the deterrent effect of closing the administrative amnesty route depends on how strictly future violations are now penalised as civil liabilities.

    Conclusion

    The Supreme Court has closed the administrative route for open-ended retrospective environmental clearance while preserving a narrow, notification-based exception for genuine public interest cases. Whether this actually curbs future violations depends on how strictly the Centre applies the “narrowly tailored” and “intelligible differentia” tests the Court has now set, and whether civil penalties under the Jan Vishwas Act carry enough deterrent weight.

    Back2Basics:

    Environment (Protection) Act, 1986

    1. Enactment: The Environment (Protection) Act, 1986 was enacted after the 1984 Bhopal gas tragedy, giving the Central government overarching powers to protect and improve the environment.
    2. EIA notification: The Environmental Impact Assessment (EIA) Notification, 2006, issued under Section 3 of this Act, mandates prior environmental clearance for specified categories of projects before construction begins.
    3. Jan Vishwas Act, 2023: This Act decriminalised minor offences across 42 laws, including converting the penalty for breaching the prior environmental clearance requirement from imprisonment to a civil liability.

    PYQ Relevance

    [UPSC 2020] How does the draft Environment Impact Assessment (EIA) Notification, 2020 differ from the existing EIA Notification, 2006?

    Linkage: The PYQ examines India’s Environmental Impact Assessment (EIA) framework and the legal requirements governing environmental clearances. The article builds on the PYQ by analysing the Supreme Court’s decision to invalidate open-ended ex post facto environmental clearances, reinforcing prior approval as the cornerstone of the EIA regime.

  • The IACS and the making of modern Indian science

    Why in the News?

    The Indian Association for the Cultivation of Science (IACS) marked its 150th anniversary this year. It was established on 29 July 1876 as India’s first national institution dedicated to scientific research by Indians.

    What is the Indian Association for the Cultivation of Science (IACS)?

    1. Founding: The IACS was established on 29 July 1876 in Calcutta by Mahendralal Sircar, as the country’s first institution dedicated to scientific research led by Indians.
    2. Founding vision: Sircar proposed the IACS in an 1869 article in the Calcutta Journal of Medicine, arguing that scientific education was indispensable for India’s intellectual and societal progress.
    3. Colonial context: Sircar’s founding was a direct response to what he described in 1872 as the colonial government’s failure to “afford any opportunity” or “encouragement to the pursuit of science by the native of this country.”

    How did the IACS produce Raman’s discovery of the Raman effect?

    1. Raman’s introduction to IACS: After joining the Accountant General’s Office in Calcutta in 1907, C V Raman discovered the IACS and was given open access to its laboratories by Amrit Lal Sircar, the founder’s son.
    2. Dual life as scientist and officer: For nearly a decade, Raman worked at the IACS laboratory in the early mornings and evenings while serving as a government officer during the day, continuing even after he became Palit Professor of Physics at Calcutta University in 1917.
    3. The discovery: Raman made his most celebrated discovery, the Raman effect, in the IACS laboratories, announcing it to the world on 28 February 1928.
    4. Nobel recognition: The discovery earned Raman the Nobel Prize in Physics in 1930, making him the first Asian scientist to win a Nobel Prize in the sciences.

    What does IACS’s history reveal about colonial-era Indian science?

    1. Institutional gap Sircar identified: Sircar’s founding case rested on the argument that Indians needed their own institution because the colonial state had not created one, showing that India’s earliest scientific self-reliance was born out of exclusion rather than official support.
    2. Vision fulfilled: Raman’s Nobel Prize, won through work conducted at an institution founded and funded by Indians, is presented as the fulfilment of Sircar’s original claim that such an institution could produce discoveries of international significance without depending on colonial institutional support.

    Conclusion

    The IACS’s 150-year history runs from Mahendralal Sircar’s 1876 founding, born of colonial neglect of Indian scientific talent, to C V Raman’s 1930 Nobel Prize, won through research conducted entirely within that institution. The anniversary is presented as a reminder that India’s earliest scientific self-reliance predates independence by seven decades.

    Back2Basics:

    1. National Science Day: India observes National Science Day on 28 February each year to mark the anniversary of the announcement of the Raman effect.
    2. Present role: IACS continues to function as an autonomous research institute under the Department of Science and Technology, focused on basic sciences.

  • On antibiotics, problem isn’t just overprescribing

    Why in the News?

    A new global study in The Lancet Public Health has again found that India consumes too many broad-spectrum “watch” antibiotics and too few first-line “access” antibiotics, with total antibiotic consumption above the optimal target. The deeper problem is not physician irrationality but the systemic conditions that push doctors toward broader antibiotics in the first place.

    What does the Lancet study find about India’s antibiotic use?

    1. Consumption above target: India’s antibiotic consumption is higher than the optimal target identified in the study.
    2. Skewed drug mix: India’s antibiotic mix is skewed toward “watch” category broad-spectrum drugs that should ideally be reserved for more serious infections, rather than first-line “access” antibiotics.
    3. Documented pattern: This overuse of broad-spectrum antibiotics has been repeatedly documented over the past two decades through surveillance studies, hospital audits and national AMR programmes.

    Why do doctors keep prescribing broad-spectrum antibiotics despite knowing the risk?

    1. Late presentation: Doctors often prescribe antibiotics before a definitive diagnosis is available because patients present late in their illness.
    2. Diagnostic unreliability: Limited or unreliable diagnostic facilities mean treatment decisions cannot always wait for confirmatory tests.
    3. Healthcare-associated infection risk: Inadequate infection prevention and control in healthcare facilities increases the likelihood of healthcare-associated infections, pushing clinicians toward broader-spectrum agents from the outset.
    4. The reframing: In the article’s own terms, antibiotics are often used to compensate for systemic weaknesses in diagnosis and infection control, not administered out of irrational prescribing habits.

    What structural reforms does the article call for?

    1. Infection prevention first: Better water, sanitation and hygiene, wider vaccine coverage, and sustained investment in infection prevention and control programmes in hospitals would reduce the burden of infections that require antibiotics at all.
    2. Diagnostic capacity: India has begun building this through the National Health Mission, the Free Diagnostics Service Initiative and the National Essential Diagnostics List, but laboratory quality, accreditation and turnaround time still need improvement.
    3. Stewardship training: Clinicians need training in antimicrobial stewardship and evidence-based prescribing, alongside community education that antibiotics do not treat viral infections.

    Has India actually made no progress, as the “overprescribing” framing implies?

    1. Reforms already underway: India has established a National Action Plan on AMR, expanded surveillance through the National Centre for Disease Control and the Indian Council of Medical Research (ICMR), introduced antimicrobial stewardship initiatives, and regulated fixed-dose combinations.
    2. Scale argument: A country with nearly one-fifth of the world’s population and one of its largest public health systems cannot transform antibiotic use overnight, and progress should be judged by the direction of ongoing reforms, not only current consumption levels.

    Conclusion

    India’s antibiotic overuse is a systemic problem rooted in late diagnosis, weak infection control and unreliable laboratories, not a simple failure of physician judgment that fewer prescriptions alone would fix. What must change is investment in diagnostics and infection prevention capacity, since asking doctors to prescribe less without fixing those underlying gaps risks costing lives rather than curbing resistance.

    Back2Basics:

    Antimicrobial Resistance (AMR)

    1. Definition: AMR occurs when bacteria, viruses, fungi and parasites evolve to resist the drugs designed to kill them, making infections harder to treat.
    2. India’s National Action Plan: India’s National Action Plan on AMR, coordinated by the Ministry of Health and Family Welfare, covers surveillance, infection prevention, stewardship, research and international collaboration.
    3. Surveillance network: The National Centre for Disease Control and the Indian Council of Medical Research (ICMR) run India’s national AMR surveillance network across sentinel hospital sites.
    4. WHO classification: The WHO’s AWaRe classification divides antibiotics into Access (first-line, low resistance risk), Watch (broader-spectrum, higher resistance risk) and Reserve (last-resort) categories.

    PYQ Relevance

    [UPSC 2014] Can overuse and the availability of antibiotics without doctor’s prescription be the contributors to the emergence of drug resistant diseases in India? What are the available mechanisms for monitoring and control? Critically discuss the various issues involved.

    Linkage: The PYQ examines antimicrobial resistance caused by antibiotic misuse and the mechanisms needed for its monitoring and control. The article extends the PYQ by explaining that irrational antibiotic use is driven by systemic gaps in diagnostics, infection control and stewardship, and highlights ongoing AMR reforms in India.

  • ‘Virtual magnet’ claims reveal why EVs need their rare-earths

    Why in the News?

    A Bengaluru startup, Vimag Labs, has claimed to replace rare-earth permanent magnets in electric motors with software-controlled “virtual” magnets built from copper coils and electromagnets. The claim describes a decades-old electromagnet design rather than a genuine breakthrough, and that it does not resolve the efficiency, cost and rare-earth dependency problems facing India’s electric vehicle (EV) motor supply chain.

    What is the startup actually claiming to have built?

    1. The claim: Vimag Labs says it removes permanent magnets from a motor, replaces them with copper coils, and uses software to generate magnetic fields inside the motor.
    2. What this technically is: Passing current through copper coils wound around a ferromagnet to temporarily create a magnetic field is an electromagnet, a design used in large hydroelectric, thermal and nuclear power plant generators for more than 135 years.
    3. No novelty in the mechanism: The software in this design does not create magnetism; it only regulates how much current flows through the electromagnets, controlling the strength and direction of the existing magnetic field.

    Why do permanent magnets remain more efficient than electromagnets in EV motors?

    1. One-step versus multi-step process: A permanent magnet establishes a magnetic field in a single step with no additional electrical energy, while an electromagnet requires the field to be established and continuously modulated by software, consuming energy at every step.
    2. Energy losses compound: Electromagnet-based motors face core losses in the ferromagnetic core, resistance losses in copper conductors, and switching and conduction losses in electronic switches, making them unlikely to match a permanent magnet motor’s efficiency.
    3. Efficiency drives EV range: Every 0.1% increase in motor drive efficiency improves range for a given battery size, since the battery pack is the costliest and heaviest component of an EV, which is why permanent magnet synchronous motors dominate the EV market today.

    What is India’s underlying rare-earth dependency problem that this claim does not solve?

    1. No alternative has matched permanent magnets: BMW and Renault have tried electrically excited motors, and Tesla’s first Model S used an induction motor in 2012, but neither matched permanent magnet efficiency.
    2. Other alternatives face their own limits: The switched reluctance motor (SRM), which uses neither permanent magnets nor copper coils in its rotor, avoids rare-earth dependency but suffers from noisier, less efficient, spurt-like torque delivery, an approach Honda and Hitachi Astemo are still trying to refine.
    3. Conclusion of the constraint: Efficiency, starting torque capability and maximum achievable speed remain the constraints that have kept non-permanent-magnet motors out of mainstream EVs, meaning India’s EV motor supply chain still depends on rare-earth magnets regardless of this claim.

    Conclusion

    The Bengaluru startup’s “virtual magnet” is an established electromagnet design, not a new way to escape rare-earth dependency, since electromagnets remain less efficient than permanent magnets for the reasons physics has established for decades. India’s EV motor strategy must therefore continue to treat rare-earth and critical mineral access as a supply chain problem to be solved directly, rather than expect a software fix to remove the need for these magnets.

    Back2Basics:

    Rare Earth Elements (REEs)

    1. What they are: Rare Earth Elements are a set of 17 metallic elements used in permanent magnets, electronics, and clean energy technologies, valued for their magnetic and conductive properties.
    2. China’s dominance: China holds the largest share of global rare earth mining and processing capacity, giving it significant leverage over EV motor and electronics supply chains worldwide.
    3. India’s response: India launched the National Critical Mineral Mission (NCMM) in 2025 to build a framework for self-reliance in critical minerals, including rare earths, reducing import dependency for strategic sectors such as EVs and electronics.

    Back2Basics

    Role of Permanent magnets in Electric Vehicles:

    They are vital for electric vehicles because they provide high energy efficiency, maximum torque density, and compact motor sizing. They are primarily used in the main traction motor, power steering, and auxiliary systems.

    Core Functions in EV Motors

    1. Creating Constant Fields: They produce a strong, permanent magnetic field without needing extra electricity.
    2. Energy Conversion: They interact with electrical coils to turn electric energy into physical motion that spins the wheels.
    3. Regenerative Braking: They help capture energy back when the car slows down

    PYQ Relevance

    [UPSC 2026] Which of the following statements about Rare Earth Elements (REEs) and Critical Minerals is/are correct?

    1. Modern technological innovations including Artificial Intelligence, robotics and space exploration extensively utilise Rare Earth Elements (REEs).

    2. China has the highest share in mining of REEs followed by India.

    3. The Government of India launched the National Critical Mineral Mission (NCMM) in 2025 to establish a robust framework for self reliance in the critical mineral sector.

    4. Rare Earth Elements are a set of 13 metallic elements.

    (a) 1 and 3 only

    (b) 3 only

    (c) 1, 3 and 4

    (d) 1, 2 and 4″

    Answer: (a)

  • PLI schemes drive ₹96,000 crore investment

    Why in the News

    The production-linked incentive scheme for large-scale electronics manufacturing (PLI-LSEM) has catalysed Rs 96,000 crore of investment in India’s mobile manufacturing ecosystem, Parliament was informed on 29 July 2026. Electronics production crossed Rs 3.11 lakh crore in FY 2025-26, and the Semicon India Programme has moved from policy announcement to actual commercial output for the first time.

    What is the PLI Scheme for Large-Scale Electronics Manufacturing (PLI-LSEM)?

    1. Launch and purpose: PLI-LSEM was launched in 2020 to boost indigenous production of mobile phones and reduce import dependence.
    2. Mechanism: The scheme pays eligible manufacturers a percentage incentive on incremental sales of India-made goods over a base year, tied to investment and production commitments.
    3. Scope expansion: The government followed it with PLI Scheme 2.0 for IT Hardware in 2023, covering laptops, tablets and servers.
    4. Semicon India Programme: A separate scheme approves fabrication and packaging projects to build domestic semiconductor manufacturing capacity.

    What does the data show about electronics manufacturing growth?

    1. Investment catalysed: PLI-LSEM has catalysed approximately Rs 96,000 crore of investment in the mobile manufacturing ecosystem.
    2. Production growth: Electronics production rose from Rs 1.32 lakh crore in FY 2024-25 to Rs 3.11 lakh crore in FY 2025-26, a year-on-year growth of 15.8%.
    3. Domestic value addition: An external evaluation study found domestic value addition (DVA) under PLI-LSEM increased to 23% in FY 2023-24.
    4. Export ranking: Smartphones, absent from India’s top 100 exported commodities in 2014, became India’s top exported individual commodity in FY 2025-26, surpassing petroleum and gems and jewellery.
    5. IT Hardware scheme: PLI Scheme 2.0 for IT Hardware has generated cumulative production of Rs 24,385.89 crore, cumulative investment of Rs 1,056.36 crore, and 5,216 direct jobs.

    What is the state of the Semicon India Programme?

    1. Projects approved: 12 projects have been approved under the Semicon India Programme, entailing a committed investment of Rs 1.64 lakh crore.
    2. Commercial production: 3 of the 12 approved projects have already started commercial production.
    3. Private follow-on investment: Semiconductor firm Marvell Technology has separately announced a $250 million investment in India, citing the country’s growing role as an engineering hub.

    Challenges to India’s PLI and semiconductor manufacturing push

    1. Import dependence on components: India’s electronics assembly still relies heavily on imported chips and displays, keeping true domestic value addition below finished-goods value.
    2. Technology gap: India’s semiconductor fabrication projects remain at trailing-edge nodes, far behind the sub-10 nanometre technology used by global leaders such as Taiwan.
    3. Fiscal cost of incentives: The PLI outlay across sectors runs into tens of thousands of crores, raising questions about cost per job created against alternative uses of the same fiscal space.
    4. Sunset risk: PLI incentives are time-bound, and companies that scale up during the incentive period face uncertainty about competitiveness once the subsidy period ends.
    5. Tariff exposure: Sharp increases in United States tariffs on electronics exports could squeeze the margins that make India-based assembly viable for global companies.

    Conclusion

    The PLI-LSEM and Semicon India Programme disclosures show incentive-linked manufacturing has moved from policy design to measurable investment and production gains, with smartphones now India’s top exported commodity. The next milestone is whether the remaining nine approved semiconductor projects reach commercial production and whether domestic value addition rises beyond assembly-level gains.

    Back2Basics:

    Production-Linked Incentive (PLI) Scheme

    1. Launch: The PLI framework was launched in 2020 across multiple sectors to boost domestic manufacturing and cut import dependence.
    2. Mechanism: The government pays selected manufacturers a financial incentive, typically 4-6% of incremental sales over a base year, contingent on investment and production commitments.
    3. Nodal ministry: The Ministry of Electronics and Information Technology administers PLI-LSEM and IT Hardware; other sectors are administered by their respective ministries.
    4. Sectoral spread: PLI schemes cover 14 sectors including mobile manufacturing, pharmaceuticals, telecom equipment, textiles, food processing and semiconductors.

    The Semicon India Programme

    1. It is a national initiative backed by financial outlays and implemented through the India Semiconductor Mission to build a complete domestic semiconductor and display manufacturing ecosystem

    Financial Outlay and Phases

    1. Phase 1 (Semicon 1.0): Approved in December 2021 with an initial fiscal outlay of ₹76,000 crore to incentivize silicon fabs, display units, and packaging.
    2. Phase 2 (Semicon 2.0): Approved in July 2026 with an expanded outlay of ₹1,27,500 crore to widen the scope of domestic manufacturing and supply chains.

    Core Focus Pillars

    1. Semiconductor Fabs: Fiscal backing covering up to 50% of project costs for silicon CMOS fabrication units.
    2. ATMP/OSAT: Support for assembly, testing, marking, and packaging facilities.
    3. Design & R&D: Incentives for chip design infrastructure, raw materials, equipment, and talent development.

    PYQ Relevance

    [UPSC 2025] Discuss the rationale of the Production Linked Incentive (PLI) scheme. What are its achievements? In what way can the functioning and outcomes of the scheme be improved?
    Linkage: The PYQ examines government policies to promote manufacturing, industrial growth and global competitiveness. The article evaluates how PLI-LSEM and the Semicon India Programme are strengthening electronics manufacturing, exports and domestic value addition while highlighting the remaining challenges in semiconductor self-reliance.

  • Does the RBI believe rupee is ‘undervalued’?

    Why in the News

    Reserve Bank of India (RBI) Governor has repeated, across two separate settings, that the rupee is undervalued in both nominal and real effective exchange rate (REER) terms. The remark is unusual because central bankers rarely comment on whether their own currency is priced fairly, and it comes as the rupee has depreciated 5.8% year-to-date against the US dollar.

    What is Real Effective Exchange Rate (REER) and why does it matter here?

    1. Definition: The real effective exchange rate (REER) measures a country’s currency value against a basket of trading partner currencies, adjusted for inflation.
    2. Contrast with nominal rate: The nominal exchange rate measures the rupee’s value against a single currency such as the US dollar, while REER captures relative price changes across multiple trading partners.
    3. Why economists prefer it: Economists rely on REER to assess overvaluation or undervaluation because it accounts for inflation differentials rather than only bilateral currency movements.

    What did the Governor actually say?

    1. First statement: It would be reasonable to think the rupee is not overvalued, and that “one could argue the rupee has become undervalued both in nominal and in REER terms.”
    2. Walk-back attempt: He initially disagreed that he had made such a statement, before again saying, “It is reasonable to think that it [Rupee] may not be overvalued.”
    3. No exchange rate target: He reiterated that the RBI does not target any specific exchange rate or band for the rupee.
    4. Market interpretation: Financial markets read the remarks as an indication that the central bank believes the rupee has weakened beyond what economic fundamentals justify.

    What is driving the rupee’s depreciation despite the RBI’s undervaluation claim?

    1. External pressure factors: Higher crude oil prices, geopolitical tensions, a stronger US dollar and intermittent foreign portfolio outflows from emerging markets have pressured the rupee.
    2. Capital outflows: Foreign portfolio investors have drained billions from the Indian stock market, increasing dollar demand while reducing capital inflows.
    3. Domestic fundamentals cited: The RBI points to over 6% annual growth, moderating inflation and forex reserves covering 11 months of imports as evidence the depreciation does not reflect domestic conditions.

    Can a Market-Determined Exchange Rate Be Undervalued?

    1. Non-intervention position: The RBI maintains it does not seek either a permanently strong or a permanently weak currency, and that its exchange rate policy is market-determined.
    2. Limited intervention purpose: The RBI’s foreign exchange interventions aim only to curb excessive volatility and ensure orderly market conditions, not to defend a fixed rupee value.
    3. The tension: By publicly labelling the rupee undervalued while disclaiming any exchange rate target, the Governor signals a view on fair value without committing to any corrective policy action, leaving markets to price in the central bank’s assessment without a stated mechanism to act on it.

    Conclusion

    The RBI Governor’s repeated undervaluation remark distinguishes short-term currency market pressure from India’s underlying macroeconomic fundamentals, without indicating any change in the central bank’s non-intervention stance. Whether the rupee corrects toward this “fair value” will depend on crude oil prices, US monetary policy and capital flows rather than any RBI trigger.

    Back2Basics:

    Real Effective Exchange Rate (REER)

    1. Definition: REER measures a currency’s value against a trade-weighted basket of partner currencies, adjusted for relative inflation.
    2. Custodian: The RBI publishes REER indices for the rupee using 6-currency and 40-currency trade-weighted baskets.
    3. Reading the index: A REER value above 100 relative to the base year typically signals overvaluation; below 100 signals undervaluation.

    Nominal Effective Exchange Rate (NEER)

    1. Definition: NEER measures a currency’s value against a trade-weighted basket of partner currencies, without adjusting for inflation.
    2. Core Concept: It shows the pure external value of the rupee against a group of foreign currencies based purely on market exchange rates.

    Key Differences: NEER vs REER

    1. Inflation Adjustment: NEER ignores inflation completely, while REER adjusts the NEER value for inflation differences between India and its trading partners.
    2. Economic Meaning: NEER tracks simple currency price movements, whereas REER reflects the actual price competitiveness of Indian goods in the global market.
    3. Formula Relationship: REER X (Domestic Inflation Index/Foreign Inflation Index)
    4. Policy Focus: If India’s inflation is higher than its partners, REER will rise faster than NEER, signaling that Indian exports are becoming more expensive despite a stable nominal exchange rate.

    PYQ Relevance

    [UPSC 2018] How would the recent phenomena of protectionism and currency manipulations in world trade affect macroeconomic stability of India?

    Linkage: It examines the impact of exchange rate movements on India’s macroeconomic stability and external sector. It extends the PYQ by explaining RBI’s REER-based assessment of the rupee’s valuation under a market-determined exchange rate regime.

  • India Becomes Free from Left Wing Extremism (LWE)

    Why in News?

    The Ministry of Home Affairs (MHA) announced that India became free from Left Wing Extremism (LWE) in March-April 2026, following sustained implementation of the National Policy and Action Plan (2015).

    Key Highlights

    • No district is currently categorized as LWE-affected.
    • LWE-affected districts reduced from: 126 (2014) → 90 (2018) → 70 (2021) → 38 (2024) → 8 (2025) → 0 (2026).
    • 37 districts are now classified as Legacy & Thrust Districts for continued security and development support.
    • 1 district remains a District of Concern for continued surveillance.

    National Policy and Action Plan (2015)

    • Adopts a Whole-of-Government Approach focusing on: Security operations. Infrastructure and connectivity. Welfare and development. Protection of tribal rights. Good governance and financial inclusion.

    Major Government Initiatives

    Security Measures

    • Security Related Expenditure (SRE) Scheme.
    • Modernisation of Police Forces (MPF).
    • Special Infrastructure Scheme (SIS).
    • Assistance to Central Agencies for LWE Management (ACALWEMS).
    • Surrender-cum-Rehabilitation Policy for Maoist cadres.

    Development Measures

    • 15,189 km roads constructed in LWE areas.
    • 9,497 telecom towers commissioned.
    • 179 Eklavya Model Residential Schools (EMRS) functional.
    • 47 ITIs and 49 Skill Development Centres established.
    • 6,025 post offices with banking services opened.
    • Security camps are being converted into Jan Suvidha Kendras.

    Other Initiatives

    • Special Central Assistance (SCA) for infrastructure.
    • Tribal Youth Exchange Programme (TYEP).
    • Civic Action Programme (CAP) to improve community engagement.
    • Distribution of over 21 lakh Forest Rights Act title deeds.

    [2023] Consider the following statements:
    1. According to the Constitution of India, the Central Government has a duty to protect States from internal disturbances.
    2. The Constitution of India exempts the States from providing legal counsel to a person being held for preventive detention.
    3. According to the Prevention of Terrorism Act, 2002, confession of the accused before the police cannot be used as evidence.
    How many of the above statements are correct?

    [A] Only one

    [B] Only two

    [C] All three

    [D] None

  • Celebrating 25 Years of the Himalayan Chandra Telescope (HCT)

    Why in News?

    The Himalayan Chandra Telescope (HCT) at Hanle, Ladakh, completed 25 years of operation. The occasion was marked by a conference highlighting its scientific achievements and future expansion plans.

    Key Highlights

    • Location: Indian Astronomical Observatory (IAO), Hanle, Ladakh (4,517 m).
    • Managed by: Indian Institute of Astrophysics (IIA) under the Department of Science and Technology (DST).
    • First Light: 26 September 2000; dedicated to the nation in 2001.
    • Named after Subrahmanyan Chandrasekhar.
    • Operated remotely from Bengaluru via INSAT-3B since 2001.

    Why is Hanle Important?

    • Over 250 clear nights annually.
    • Very low atmospheric water vapour and minimal light pollution.
    • Ideal for optical and near-infrared astronomy.
    • Protected under the Hanle Dark Sky Reserve.

    Major Scientific Contributions

    • Studies of gamma-ray bursts, comets, exoplanets, supernovae, variable stars, galaxies, and active galactic nuclei (AGN).
    • Contributed to the discovery of TRAPPIST-1b.

    Key Instruments

    • HFOSC – Optical camera and spectrograph.
    • uTIRSPEC – Near-infrared spectrometer.
    • HESP – High-resolution Echelle spectrograph.

    Future Plans

    The Union Budget announced:

    • 3.7-m Upgraded Himalayan Chandra Telescope (UHCT).
    • 13.7-m National Large Optical-Infrared Telescope (NLOT) at Hanle.

    Prelims Facts

    • HCT: 2-m optical telescope at Hanle, Ladakh.
    • Nodal Agency: Indian Institute of Astrophysics (IIA).
    • Administrative Ministry: Department of Science and Technology (DST).
    • Hanle Dark Sky Reserve: India’s first Dark Sky Reserve.

    [2016] With reference to ‘Astrosat’,’ the astronomical observatory launched by India, which of the following statements is/are correct?
    1. Other than USA and Russia, India is the only country to have launched a similar observatory into space.
    2. Astrosat is a 2000 kg satellite placed in an orbit at 1650 km above the surface of the Earth.
    Select the correct answer using the code given below.

    [A] 1 only

    [B] 2 only

    [C] Both 1 and 2

    [D] Neither 1 nor 2

  • Viruses don’t respect borders: the case for timely, fair global vaccine access for zoonotic outbreaks

    Why in the News?

    An International Centre for Genetic Engineering and Biotechnology (ICGEB) scientist has argued that timely and fair global vaccine access for zoonotic outbreaks, such as Ebola, Nipah and hantavirus, requires academia-industry partnerships and a shared risk funding model. This is because such vaccines are not commercially attractive to manufacturers.

    Why are zoonotic outbreak vaccines commercially unattractive?

    1. Small, unpredictable markets: Ebola, Nipah and hantavirus outbreaks are episodic and geographically concentrated, giving manufacturers no stable, predictable market to justify sustained investment.
    2. High development cost, low return: Vaccine development costs remain similar regardless of market size, so a vaccine with a small addressable market offers manufacturers a poor return relative to vaccines for widespread diseases.
    3. Outbreak timing mismatch: Vaccine demand spikes only during an active outbreak, while development must happen years in advance, a mismatch that discourages manufacturers from investing ahead of demonstrated demand.

    What would a shared risk funding model change?

    1. Risk redistribution: A shared risk funding model spreads the financial risk of vaccine development across academia, industry and public funders, rather than leaving it entirely on a manufacturer’s commercial judgment.
    2. Academia-industry partnership: Academic institutions like ICGEB can carry early stage research risk, handing over a de-risked candidate for industry to scale, lowering the barrier for private investment.
    3. Access consequence: A funding model that does not depend on commercial viability alone can keep resulting vaccines priced for equitable global access rather than for cost recovery in a niche market.

    Conclusion

    The central idea is that zoonotic outbreak vaccines fail a commercial viability test that has nothing to do with their public health importance. A shared risk funding model, built on academia-industry partnership, is the mechanism proposed to close that gap between epidemic risk and market incentive.

    Back2Basics

    International Centre for Genetic Engineering and Biotechnology (ICGEB): An intergovernmental organisation with a component in New Delhi, conducting research in genetic engineering and biotechnology, including vaccine and infectious disease research.

    PYQ Relevance

    [UPSC 2022] What is the basic principle behind vaccine development? How do vaccines work? What approaches were adopted by the Indian vaccine manufacturers to produce COVID-19 vaccines?

    Linkage: The PYQ examines the scientific principles of vaccine development and the challenges in developing vaccines for emerging infectious diseases. The article explains why vaccines for zoonotic diseases require shared-risk funding and academia-industry partnerships to overcome weak commercial incentives and ensure equitable access.

  • Industrial growth hits 23 month high of 7.3% in June, IIP data shows

    Why in News?

    The Index of Industrial Production (IIP) recorded 7.3% growth in June, a 23 month high, driven by manufacturing, electricity and capital goods, per Ministry of Statistics and Programme Implementation (MoSPI) data.

      Key Highlights

      1. Headline growth: Industrial growth reached 7.3% in June, its highest in 23 months.
      2. Sectoral drivers: Manufacturing grew 7.8%, electricity 10.6%, and capital goods 14.2%.
      3. Breadth: 19 of 23 manufacturing groups posted growth.
      4. Risk flags: Analysts cite a weak monsoon and the West Asia war as risks to sustaining this growth pace.

      What is the Index of Industrial Production (IIP)?

      1. The IIP is a monthly indicator measuring the volume of industrial production in the economy.
      2. It is compiled and released by the National Statistics Office (NSO) under MoSPI.
      3. It reflects the performance of the mining, manufacturing and electricity sectors.
      4. Base Year: 2022-23.

      Components of IIP

      1. Manufacturing: Largest contributor with about 77% weight.
      2. Mining: Around 14% weight.
      3. Electricity: Around 8% weight.
      4. Use-Based Classification: Primary Goods, Capital Goods, Intermediate Goods, Infrastructure/Construction Goods, Consumer Durables, and Consumer Non-Durables

      [2012] In India the overall Index of Industrial Production, the Indices of Eighth Core Industries have combined weight of 37.90%. Which of the following are among those Eight Core Industries?
      1. Cement
      2. Fertilizers
      3. Natural Gas
      4. Refinery products
      5. Textiles
      Select the correct answer using the codes given below:

      [A] 1 and 5 only

      [B] 2, 3 and 4 only

      [C] 1, 2, 3 and 4 only

      [D] 1, 2, 3, 4 and 5