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  • 🔴[UPSC 2026 Webinar On Form Filling] By Saket Sir Lead, Interview Programme, Civilsdaily IAS | Step-by-Step Guide to Filling the UPSC CSE 2026 Application Form | Join on 6th Feb at 7PM

    🔴[UPSC 2026 Webinar On Form Filling] By Saket Sir Lead, Interview Programme, Civilsdaily IAS | Step-by-Step Guide to Filling the UPSC CSE 2026 Application Form | Join on 6th Feb at 7PM

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    A single mistake in the UPSC application form can cost you an entire year.
    And most of these mistakes happen not due to carelessness, but due to lack of clarity.

    In this session, I’ll walk you through the UPSC CSE 2026 application form step by step, explaining exactly what to fill, how to fill it, and what to double check before final submission.

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    It’s a practical, error-proof walkthrough based on real issues aspirants face every year.

    Saket Sir, Civilsdaily IAS

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  • [5th February 2025] The Hindu OpED: A turning point for nuclear deterrence

    PYQ Relevance

    [UPSC 2023] The expansion and strengthening of NATO and a stronger US-Europe strategic partnership works well for India. What is your opinion about this statement? Give reasons and examples to support your answer.

    Linkage: This question is relevant for GS Paper II (International Relations) as it examines NATO’s role, US-Europe security dynamics, and their impact on global strategic stability. The article links directly by showing how erosion of trust in the United States of America (USA) within NATO and weakening nuclear deterrence challenge alliance credibility.

    Mentor’s Comment

    For the first time since the Cold War, the credibility of the U.S.-led extended deterrence in Europe is being openly questioned. This is coinciding with the collapse of arms control regimes and lessons emerging from the Ukraine war. This article is significant for GS Paper II and III due to its direct linkage with nuclear doctrine, alliance credibility, arms control, and evolving security architectures.

    Why in the News?

    Europe is facing a major break in its nuclear security system. Trust in the United States of America (USA) as the North Atlantic Treaty Organization (NATO)’s primary nuclear security guarantor is weakening. At the same time, the New Strategic Arms Reduction Treaty (New START), the last remaining arms control agreement between the United States of America (USA) and Russia, is nearing expiry. Major nuclear powers are expanding and modernising their nuclear arsenals, indicating a return to competitive deterrence. The Russia-Ukraine war has shown that nuclear threats do not necessarily determine conflict outcomes. Together, these developments challenge the long-held belief that nuclear deterrence rests on certainty of retaliation. For the first time in several decades, Europe is openly debating a security architecture that does not fully rely on the United States of America (USA). This marks a shift from stable Cold War deterrence to a fragmented and uncertain global nuclear order.

    Recent Timeline 

    1. 2019-2020: Erosion of trust within the North Atlantic Treaty Organization (NATO) begins as the United States of America (USA) adopts a more transactional approach towards allies, raising doubts about extended nuclear deterrence commitments.
    2. 2022 (February):
      1. Russia invades Ukraine, a non-nuclear country.
      2. Nuclear threats are issued by Russia, but no nuclear weapons are used, weakening the belief that nuclear threats alone ensure deterrence.
    3. 2022-2023: Conventional military support to Ukraine by Europe and allies deters nuclear escalation, suggesting that certainty of strong non-nuclear response can be more effective than nuclear ambiguity.
    4. 2023 onwards: China accelerates nuclear modernisation, reportedly adding around 100 nuclear warheads annually, signalling a shift towards quantitative and qualitative nuclear expansion.
    5. 2023-2024: The United Kingdom reverses its earlier decision to reduce nuclear stockpiles, reflecting renewed emphasis on nuclear deterrence in Europe.
    6. 2024-2025: New Strategic Arms Reduction Treaty (New START) between the United States of America (USA) and Russia approaches expiry in February 2025, leaving no successor arms control framework in place.
    7. Present Context: Europe begins open discussions on a post-United States of America (USA) security architecture, including debates on a France-United Kingdom nuclear umbrella and reduced reliance on NATO-centric deterrence.
    Nuclear Deterrence: It refers to a principle in international relations where the retaliatory potential and destructive force of nuclear weapons prevents nations from launching a nuclear attack.

    How Has Trust in NATO’s Nuclear Architecture Been Eroded?

    1. Alliance Credibility: Weakens as Europe’s trust in the U.S. as NATO’s primus inter pares deteriorates due to coercive diplomacy and economic pressure on allies.
    2. Greenland Dispute: Exposes internal alliance fractures by challenging the sovereignty of a NATO member, Denmark.
    3. Deterrence Hollowing: Undermines NATO’s nuclear credibility since deterrence depends on trust, not merely weapon possession.
    4. Strategic Consequence: Forces Europe to reassess reliance on U.S. extended nuclear deterrence.

    Why Is the End of Arms Control a Structural Break?

    1. Treaty Collapse: Signals erosion of the global arms control architecture with the expiry of New START.
    2. Stockpile Reversal: Indicates renewed nuclear expansion after decades of reductions between the U.S. and Russia.
    3. Quantitative Shift: Highlights data showing U.S. and Russian stockpiles at 5,459 and 5,277 warheads respectively, with prospects of increase.
    4. Cold War Reversion: Reinforces deterrence logic based on accumulation rather than restraint.

    What Debate on ‘What Deters’ Is Re-Emerging?

    1. Uncertainty-Based Deterrence: Operated during early nuclear age and in India-Pakistan relations (1980s-1998).
    2. Opaque Postures: Demonstrated by Israel’s undeclared nuclear status relying on ambiguity.
    3. Certainty-Based Deterrence: Reinforced through testing and arsenal expansion by major powers.
    4. Doctrinal Ossification: Indicates stagnation in deterrence thinking despite evolving threat environments.

    Why Has the Nuclear Taboo Persisted Despite Proliferation?

    1. Non-Use Norm: Sustained since 1945 despite repeated nuclear threats.
    2. Weapon Miniaturisation: Shows development of tactical nuclear weapons without actual deployment.
    3. Normative Constraint: Reflects strength of taboo even as arsenals modernise.
    4. Strategic Paradox: Demonstrates separation between nuclear possession and nuclear use.

    What Lessons Does Ukraine Offer on Nuclear Deterrence?

    1. Threat Failure: Russian nuclear threats before and after the invasion failed to compel compliance.
    2. Response Certainty: Effective deterrence emerged from assured conventional retaliation, not nuclear ambiguity.
    3. Non-Nuclear Defence: Ukraine, despite lacking nuclear weapons, avoided decisive defeat by a nuclear adversary.
    4. Doctrinal Implication: Challenges assumption that nuclear weapons guarantee victory or coercive leverage.

    How Could Europe’s New Security Architecture Reshape Nuclear Thinking?

    1. Strategic Autonomy: Gains relevance as Europe explores security structures independent of the U.S.
    2. French-UK Umbrella: Emerges as a debated alternative but lacks clarity and consensus.
    3. Coalition of the Willing: Reflects ad hoc security arrangements replacing alliance-centric models.
    4. Future Deterrence Models: Could prioritise robust conventional deterrence with a residual nuclear component.

    Conclusion

    Nuclear deterrence is no longer anchored solely in certainty of retaliation or alliance guarantees. The breakdown of arms control, weakening of NATO cohesion, and empirical evidence from Ukraine suggest a shift towards deterrence through credible conventional response rather than nuclear threat. Europe’s choices in the coming months will shape whether global nuclear thinking adapts to contemporary security realities or reverts to Cold War orthodoxies.

  • Why carbon capture is key to achieving net-zero goal

    Why in the News?

    The Union Budget has, for the first time, made a large, dedicated fiscal commitment of ₹20,000 crore to carbon capture, utilisation and storage. This marks a shift from pilot-driven experimentation to scale-oriented deployment. The urgency is underscored by global data showing 1 billion tonnes of annual CO₂ capture required by 2030, while only 50 million tonnes are currently captured worldwide. India’s net-zero pathway increasingly depends on CCUS as emissions from cement, steel and chemicals cannot be eliminated through renewable energy substitution alone.

    What is Carbon Capture, Utilisation and Storage?

    1. It refers to technologies that capture CO₂ from industrial processes, transport it, and either store it in geological formations or convert it into useful products.
    2. Process Stages: CCUS involves capturing carbon dioxide (via post-combustion, pre-combustion, or oxy-fuel combustion), transporting it, and either using it for industrial applications or storing it permanently
    3. Role in Climate Change: It is essential for decarbonizing “hard-to-abate” sectors, including steel, cement, and chemical production, which account for significant global emissions.
    4. Carbon Removal: CCUS enables negative emissions through technologies like Bioenergy with Carbon Capture and Storage (BECCS) and Direct Air Capture (DACCS).
    5. Challenges: High capital costs, energy intensity (high auxiliary power consumption), safety concerns, and infrastructure needs for transport are major bottlenecks.

    What Does Carbon Capture, Utilisation and Storage Involve?

    1. Carbon Capture: Enables separation of CO₂ from industrial exhaust streams in cement, steel, power and refining operations.
    2. Carbon Storage: Facilitates long-term containment of CO₂ in geological formations such as depleted oil and gas reservoirs.
    3. Carbon Utilisation: Supports conversion of captured CO₂ into chemicals and industrial inputs, reducing fresh fossil use.

    Why Is CCUS Critical for Achieving Net-Zero?

    1. Hard-to-Abate Emissions: Addresses emissions that arise from chemical reactions in cement and steel, not from fuel combustion.
    2. Limits of Renewables: Recognises that shifting to renewable electricity does not eliminate process emissions in heavy industry.
    3. Climate Mitigation: Enables deep emissions reduction without compromising industrial output and economic growth.

    What Is the Current Global Status of Carbon Capture?

    1. Operational Capacity: Includes 45 commercial CCUS facilities worldwide.
    2. Captured Volume: Accounts for only 50 million tonnes of CO₂ annually, far below climate targets.
    3. 2030 Requirement: Indicates a need for 1 billion tonnes of CO₂ capture per year by 2030 to align with net-zero pathways.
    4. Deployment Gap: Highlights a sharp mismatch between climate targets and present technological scale.

    What Is the Status of CCUS Technologies in India?

    1. Pilot Projects: Includes initiatives by Tata Steel, Dalmia Cement, NTPC, ONGC, focusing on capture feasibility.
    2. Research Ecosystem: Involves dozens of research groups working on capture materials and processes.
    3. Institutional Leadership: Anchored by Centres of Excellence at Indian Institute of Technology Bombay and Jawaharlal Nehru Centre for Advanced Scientific Research, focusing on indigenous CCUS solutions.
    4. Readiness Gap: Indicates laboratory-level maturity but limited field-scale testing.

    How Does the Union Budget Change the CCUS Landscape?

    1. Fiscal Allocation: Provides ₹20,000 crore for CCUS technology development and deployment.
    2. Scale Transition: Signals movement from pilot projects to industrial demonstration.
    3. Cost Reduction: Aims to address high capital and operational costs that restrict commercial viability.
    4. Industrial Adoption: Targets steel, cement, refineries and chemicals as early adopters.

    Why Are Certain Industries Central to CCUS Deployment?

    1. Cement Sector: Generates CO₂ as an inherent by-product of limestone calcination.
    2. Steel Sector: Emits carbon through coke-based reduction processes.
    3. Chemical and Refining Industries: Produce process emissions independent of energy source.
    4. Competitiveness: Aligns emission reduction with global trade requirements, including carbon border measures.

    What Are the Economic and Strategic Benefits of CCUS?

    1. Industrial Continuity: Enables emission reduction without relocating or shutting down core industries.
    2. Global Competitiveness: Reduces exposure to mechanisms such as the EU’s Carbon Border Adjustment Mechanism.
    3. Technology Leadership: Positions India as a developer, not just adopter, of CCUS technologies.
    4. Cost Containment: Prevents loss of competitiveness from carbon-intensive exports.

    Conclusion

    CCUS is not a substitute for renewable energy but a necessary complement for India’s net-zero strategy. The Budget’s ₹20,000 crore allocation marks a decisive shift from experimentation to scale. However, success depends on rapid field deployment, cost reduction, and industry integration to ensure CCUS delivers measurable emissions reduction by 2030.

    PYQ Relevance

    [UPSC 2025] What is Carbon Capture, Utilization and Storage (CCUS)? What is the potential role of CCUS in tackling climate change? 

    Linkage: This question is directly linked to GS III (Environment, Climate Change, Clean Technologies), reflecting UPSC’s focus on technological pathways for achieving net-zero and decarbonising hard-to-abate industries.

  • NDMA’s first ever guidelines for identification of disaster victims

    Why in the News

    The National Disaster Management Authority (NDMA) has issued India’s first Standard Operating Procedures for Disaster Victim Identification. This comes after several recent mass fatality incidents such as the Air India plane crash in Ahmedabad, the chemical factory explosion in Sanand, floods in Dharali, and the Balrampur earthquake.

    Earlier, India did not have a uniform national system to identify disaster victims. Identification was often ad hoc, poorly coordinated, and slow, causing logistical problems and long delays for families. The new guidelines shift India from fragmented local practices to a standardised, scientific, and dignity-based national framework for handling disaster victims.

    Why were Disaster Victim Identification Guidelines Needed?

    1. Absence of Standardisation: Lack of a national protocol resulted in inconsistent identification methods across States.
    2. Operational Gaps: Shortage of forensic experts, poor inter-agency coordination, and logistical constraints delayed identification.
    3. Humanitarian Deficit: Families faced prolonged uncertainty due to delayed or incorrect identification of remains.
    4. Rising Mass Fatality Events: Increase in industrial accidents, floods, fires, earthquakes, and aviation disasters heightened systemic risk.

    What is the Scope of the NDMA Guidelines?

    1. Applicability: Covers identification of victims in mass fatality incidents across natural and man-made disasters.
    2. Geographical Reach: Designed for uniform adoption across States, districts, and local administrations.
    3. Lifecycle Coverage: Extends from disaster site management to final handover of identified remains to families.

    What Forensic and Scientific Methods are Prescribed?

    1. Forensic Archaeology: Supports recovery and documentation of remains at disaster sites.
    2. Forensic Odontology: Enables identification through dental records.
    3. DNA Profiling: Facilitates identification when bodies are fragmented or decomposed.
    4. Anthropology and Pathology: Assists in age, sex, and injury profiling.
    5. Medical Records Integration: Enables cross-verification using antemortem data.

    How do the Guidelines Address Operational Challenges?

    1. Inter-Agency Coordination: Defines roles of police, forensic teams, health authorities, and district administration.
    2. Logistical Planning: Addresses gaps in storage, transport, and preservation of remains.
    3. Administrative Clarity: Reduces jurisdictional overlaps between local, State, and Central agencies.
    4. Capacity Constraints: Acknowledges shortage of forensic branches and specialists across States.

    How is Sensitivity Towards Victims’ Families Ensured?

    1. Cultural Sensitivity: Mandates respect for community customs during handling of remains.
    2. Counselling Support: Emphasises emotional support for affected families.
    3. Transparent Communication: Ensures timely and accurate dissemination of identification status.
    4. Dignified Handling: Treats victim identification as both a technical and humanitarian exercise.

    Who Drafted the Guidelines and How Were They Developed?

    1. Institutional Leadership: Drafted under NDMA’s Joint Advisor.
    2. Expert Committee: Included specialists in forensics, archaeology, odontology, and pathology.
    3. Learning from Past Disasters: Incorporated lessons from earthquakes, floods, industrial accidents, and aviation crashes.
    4. Consultative Process: Involved State governments and central agencies over multiple years.

    Conclusion

    The NDMA’s Disaster Victim Identification guidelines institutionalise scientific rigour, administrative clarity, and humanitarian ethics in post-disaster management. By standardising procedures nationwide, they strengthen disaster governance, enhance public trust, and ensure dignity and closure for affected families.

    PYQ Relevance 

    [UPSC 2018] Describe various measures taken in India for Disaster Risk Reduction (DRR) before and after signing ‘Sendai Framework for DRR (2015-2030)’. How is this framework different from ‘ Hyogo Framework for Action, 2005’?

    Linkage: The question relates to GS-III disaster management, highlighting India’s shift from relief-based response under Hyogo to risk reduction and institutional accountability under the Sendai Framework. Sendai embeds ethics in disaster governance by stressing human dignity, compassion, and state responsibility in disaster response.

  • UNIFIL Suspends Activities Along the Blue Line in Southern Lebanon

    Why in the News?

    United Nations Interim Force in Lebanon temporarily suspended patrols and other activities along parts of the Blue Line in southern Lebanon after the Israeli military indicated it would release a non toxic chemical substance near the frontier.

    What is UNIFIL?

    • United Nations Interim Force in Lebanon is a UN peacekeeping mission deployed in southern Lebanon
    • Established in 1978 by UN Security Council Resolutions 425 and 426
    • Mandate expanded after the 2006 Israel Hezbollah conflict under Resolution 1701

    What is the Blue Line?

    • A UN demarcated line of withdrawal between Israel and Lebanon
    • Stretches for about 120 kilometres along southern Lebanon
    • Established in 2000 to confirm Israel’s withdrawal from southern Lebanon
    • Not an international border but a technical reference line monitored by UNIFIL
    [2017] Mediterranean Sea is a border of which of the following countries? 1. Jordan 

    2. Iraq 

    3. Lebanon 

    4. Syria 

    Select the correct answer using the code given below: 

    (a) 1, 2 and 3 only (b) 2 and 3 only (c) 3 and 4 only (d) 1, 3 and 4 only

  • Removal of the Chief Election Commissioner: Constitutional Procedure

    Why in the News?

    West Bengal Chief Minister stated that the Trinamool Congress is open to working with the Indian National Congress and other Opposition parties to initiate impeachment proceedings against Chief Election Commissioner Gyanesh Kumar.

    Who is the Chief Election Commissioner?

    • Head of the Election Commission of India
    • Responsible for superintendence, direction and control of elections to Parliament, State Legislatures, President and Vice President
    • Constitutional authority under Article 324 of the Constitution of India

    Appointment of the CEC

    • Appointed by the President of India
    • As per the Chief Election Commissioner and Other Election Commissioners Act, 2023
    • Selected by a three member committee
      • Prime Minister
      • Leader of Opposition in Lok Sabha
      • Union Cabinet Minister nominated by the Prime Minister
    • Tenure is 6 years or till 65 years of age, whichever is earlier

    Constitutional Basis for Removal

    • Article 324(5) governs removal of the CEC
    • CEC can be removed in the same manner and on the same grounds as a Judge of the Supreme Court
    • This links the process to Article 124(4) of the Constitution

    Grounds for Removal

    • Proved misbehaviour such as abuse of office, corruption or failure to discharge constitutional duties
    • Incapacity meaning physical or mental inability to perform official functions
    [2019] Consider the following statements: 

    1. The motion to impeach a Judge of the Supreme Court of India cannot be rejected by the Speaker of the Lok Sabha as per the Judges (Inquiry) Act, 1968. 

    2. The Constitution of India defines and gives details of what constitutes ‘incapacity and proved misbehaviour’ of the Judges of the Supreme Court of India. 

    3. The details of the process of impeachment of the Judges of the Supreme Court of India are given in the Judges (Inquiry) Act, 1968. 

    4. If the motion for the impeachment of a Judge is taken up for voting, the law requires the motion to be backed by each House of the Parliament and supported by a majority of total membership of that House and by not less than two-thirds of total members of that House present and voting. 

    Which of the statements given above is/are correct? 

    (a) 1 and 2 (b) 3 only (c) 3 and 4 only (d) 1, 3 and 4

  • Project Vault: US Critical Minerals Stockpiling Initiative

    Why in the News?

    Donald Trump announced Project Vault, a 12 billion dollar US initiative to stockpile critical minerals and rare earth elements to protect American industries from global supply disruptions and reduce dependence on China.

    What is Project Vault?

    • A public private partnership to buy and store critical minerals
    • Focuses on rare earths and key metals used in defence, technology and manufacturing
    • Combines 1.67 billion dollars private funding with 10 billion dollars from the Export Import Bank of the United States
    • Aims to shield US companies from supply chain shocks

    Key Minerals Covered

    • Cobalt used in rechargeable batteries and military jet engines
    • Gallium essential for semiconductors and advanced electronics
    • Other rare earths critical for EVs, aerospace, smartphones and energy systems

    How the Stockpiling System Works

    • Companies commit in advance to purchase minerals at a fixed inventory price
    • Project Vault procures and stores minerals on their behalf
    • Firms pay upfront fees and carrying costs including storage and interest
    • In emergencies, companies can access their full stockpile
    [2023] About three-fourths of world’s cobalt, a metal required for the manufacture of batteries for electric motor vehicles, is produced by: (a) Argentina 

    (b) Botswana 

    (c) the Democratic Republic of the Congo 

    (d) Kazakhstan

  • NAMASTE Scheme and Waste Pickers Enumeration Data 2026

    Why in the News?

    Ministry of Social Justice and Empowerment tabled data in Parliament on February 03, 2026 revealing the social profile of 1.52 lakh waste pickers enumerated under the NAMASTE Scheme across 35 States and Union Territories.

    Social Category Breakup

    • Scheduled Castes: 60.3 percent or 92,089
    • Scheduled Tribes: 10.5 percent or 16,077
    • Other Backward Classes: 13.7 percent or 20,954
    • General category: 10.7% or 16,329 workers

    State and UT Level  

    • Delhi and Goa show majority of waste pickers from General category
    • In Delhi, 4,289 of over 6,500 workers were from General category (65.9%)
    • In Goa, 729 of 1,286 workers were from General category (56.6%)
    • West Bengal recorded 42.4 percent General category waste pickers

    Related Data on Sanitation Workers

    • About 89,000 sewer and septic tank workers enumerated so far
    • 95.8 percent of them are men
    • 859 deaths reported due to hazardous sewer and septic tank cleaning since 2014
    • 43 deaths recorded in 2025 alone

    About NAMASTE Scheme

    • Implemented by the Ministry of Social Justice and Empowerment
    • Focuses on enumeration and formal recognition of waste pickers, sewer and septic tank workers
    • Provides protective equipment and safety measures
    • Aims to eradicate deaths due to hazardous sewer and septic tank cleaning
    [2016] ‘Rashtriya Garima Abhiyaan’ is a national campaign to: (a) rehabilitate the homeless and destitute persons and provide them with suitable sources of livelihood 

    (b) release the sex workers from their practice and provide them with alternative sources of livelihood 

    (c) eradicate the practice of manual scavenging and rehabilitate the manual scavengers 

    (d) release the bonded labourers from their bondage and rehabilitate them

  • Solid Fuel Ducted Ramjet (SFDR) Technology Test 2026

    Why in the News?

    Defence Research & Development Organisation successfully demonstrated Solid Fuel Ducted Ramjet (SFDR) technology on February 03, 2026 from Integrated Test Range, marking India’s entry into an elite group of nations with this advanced missile propulsion capability.

    About Solid Fuel Ducted Ramjet (SFDR)

    • An advanced air breathing propulsion system for long range air to air missiles
    • Uses solid fuel with controlled airflow for sustained thrust
    • Allows missiles to maintain high speed during terminal phase
    • Significantly increases range and no escape zone

    Key Highlights of the Test

    • All subsystems including nozzle less booster, SFDR motor and fuel flow controller performed as expected
    • Missile was boosted to the required Mach number before ramjet ignition
    • Performance validated through tracking instruments along the coast of the Bay of Bengal
    • Successful data capture confirmed stable combustion and thrust control

    Strategic Significance

    • Enables development of next generation long range air to air missiles
    • Provides major tactical advantage against hostile aircraft
    • Strengthens indigenous defence research and manufacturing
    • Reduces dependence on imported propulsion technologies
    [2023] Consider the following statements: 1. Ballistic missiles are jet-propelled at subsonic speeds throughout their flights, while cruise missiles are rocket-powered only in the initial phase of flight

    2. Agni-V is a medium-range supersonic cruise missile, while BrahMos is a solid-fuelled intercontinental ballistic missile

    Which of the statements given above is/are correct? 

    (a) 1 only (b) 2 only (c) Both 1 and 2 (d) Neither 1 nor 2

  • [4th February 2026] The Hindu OpED: Has the 16th Finance Commission sidelines the States?

    Mentor’s Comment

    The Finance Commission is the institutional backbone of India’s fiscal federalism. The article examines whether the 16th Finance Commission (16th FC), despite formal continuity in States’ share, has substantively weakened State fiscal autonomy by expanding the Centre’s reliance on cesses and surcharges. The analysis is critical for understanding vertical devolution, fiscal centralisation, and cooperative federalism, recurring themes in GS-II and GS-III.

    Why in the News?

    The article gains salience as the 16th Finance Commission retained the States’ share at 41%, yet expanded the divisible pool only marginally while allowing a sharp rise in cesses and surcharges, which lie outside the pool. For the first time, States across political lines showed rare consensus that their effective share of central revenues is shrinking, even as headline devolution figures remain unchanged. The issue marks a structural shift from shared taxation to unilateral central levies, raising concerns over the erosion of fiscal federalism and States’ fiscal capacity.

    Has the divisible pool expanded meaningfully under the 16th Finance Commission?

    1. Marginal Expansion: Divisible pool revenues rose from 1.1% of GDP (2013-14) to 2.2% of GDP (2023-24), indicating limited expansion despite economic growth.
    2. Static Devolution Rate: States’ share remained at 41%, unchanged from the 15th FC, masking underlying revenue shifts.
    3. Exclusion Mechanism: Cesses and surcharges remain outside the divisible pool, structurally limiting States’ access to rising revenues.

    Cess and Surcharge?

    1. Cess and surcharge are additional, non-permanent levies imposed by the Indian central government to raise revenue, often added on top of existing taxes. 
    2. A cess (e.g., Health & Education Cess) is earmarked for specific purposes, while a surcharge is an extra tax on high-income earners for general revenue. 
    3. Both are not shared with state governments. 

    Key Differences and Details:

    1. Purpose: Cess is levied for a specific purpose (e.g., education, Swachh Bharat) and cannot be used otherwise. Surcharge is used for general government expenditure.
    2. Calculation: Cess is calculated as a percentage of the tax plus surcharge. Surcharge is calculated on the tax liability itself when income exceeds specific thresholds.
    3. Applicability: Cess applies to all taxpayers, while surcharge only targets individuals or entities with higher income brackets.
    4. Revenue Sharing: Proceeds from both cesses and surcharges are credited to the Consolidated Fund of India but are generally not shared with the state governments.

    Why are cesses and surcharges central to the controversy?

    1. Revenue Composition Shift: Cesses and surcharges increased from ₹44,688 crore (FY15) to ₹4,15,022 crore (FY22).
    2. Rising Share: For every ₹100 collected by the Centre, cesses and surcharges rose from ₹7 (2012-13) to ₹13.5 (2021-22).
    3. Budget Estimate 2025-26: Centre expects ₹8.89 lakh crore through cesses and surcharges, excluding GST compensation cess.
    4. Structural Impact: These levies bypass constitutional sharing, reducing States’ fiscal predictability.

    Has the States’ effective share in central revenues declined?

    1. Consistent Decline: Between FY13 and FY18, States’ share exceeded 93% of the divisible pool revenues.
    2. Post-2019 Reversal: Following GST implementation, States’ share fell as cesses surged.
    3. 2021-22 Data Point: Out of every ₹100 collected, ₹86.5 entered the divisible pool, down from ₹93.5 in 2012-13.
    4. Fiscal Asymmetry: Vertical devolution appears intact only in form, not in substance.

    Does the Finance Commission acknowledge this imbalance?

    1. Institutional Admission: The 16th FC recognises that long-term reliance on cesses is “undesirable.”
    2. Contradictory Position: Despite acknowledging distortion, the Commission refrains from imposing limits on such levies.
    3. Deference to Centre: FC cites defence and security spending as justification for higher cesses.
    4. Policy Gap: No binding mechanism introduced to curb revenue centralisation.

    What are the implications for State finances and governance?

    1. Reduced Fiscal Autonomy: States face constrained revenue capacity despite increased expenditure responsibilities.
    2. Infrastructure Stress: High-performing States bear the raw end of fiscal imbalance due to limited untied funds.
    3. Governance Asymmetry: Centralisation weakens States’ ability to tailor welfare and development spending.
    4. Political Neutrality Questioned: Uniform State dissatisfaction indicates systemic, not partisan, concern.

    Conclusion

    The article concludes that the 16th Finance Commission preserves the appearance of fiscal federalism while weakening its substance. By allowing unchecked expansion of cesses and surcharges, the Centre has effectively reduced States’ fiscal space without altering formal devolution ratios. The issue raises fundamental questions about the constitutional balance of power, revenue sovereignty, and cooperative federalism.

    PYQ Relevance

    [UPSC 2020] Explain the rationale behind the Goods and Services Tax (Compensation to States) Act of 2017. How has COVID-19 impacted the GST compensation fund and created new federal tensions?

    Linkage: This PYQ tests GST design, compensation to States, and fiscal federalism under GS-III, especially Centre-State revenue sharing during economic shocks. COVID-19 exposed GST revenue fragility, leading to delayed compensation and greater reliance on cesses and surcharges, echoing the article’s concern over shrinking effective State fiscal space.

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