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  • India Fisheries and Seafood Export Ecosystem

    Why in the News

    India reiterated its commitment to sustainable fisheries management, value chain strengthening, deep sea resource development, regulatory cooperation and scientific collaboration during interactions involving FAO, MPEDA and NFDB, aligned with India’s Blue Economy vision.

    Key Institutions

    • Food and Agriculture Organization
    • Marine Products Export Development Authority
    • National Fisheries Development Board

    India Fisheries Sector Data Snapshot

    • Total fish production: Increased from about 95 lakh tonnes in 2013 to nearly 195 lakh tonnes in 2024
    • Share of inland fisheries and aquaculture: Over 75 percent of total fish production
    • Global rank: India among top three fish producing nations. Second largest aquaculture producer globally
    • Employment: Fisheries and aquaculture support livelihoods of over 28 million people

    Seafood Export Performance

    • FY 2023 to 24: Export volume 17.81 lakh metric tonnes. Export value about ₹60,500 crore or US$7.3 billion
    • FY 2024 to 25: Export volume about 17 lakh metric tonnes. Export value about ₹62,400 crore or US$7.45 billion
    • Top export item: Frozen shrimp. About 40 percent of export volume.Nearly 65 percent of export earnings
    • Major markets: USA, China, European Union, Japan, Southeast Asia, Middle East

    Prelims Pointers

    • MPEDA works under Ministry of Commerce and Industry
    • NFDB works under Department of Fisheries, Ministry of Fisheries Animal Husbandry and Dairying
    • Digital traceability is mandatory for exports to EU markets
    • Frozen shrimp dominates India’s seafood exports
    • Fisheries sector contributes to nutrition security and export earnings
    • Sustainable fisheries are central to India’s Blue Economy policy
    [2018] Consider the following items: 

    1. Cereal grains hulled 

    2. Chicken eggs cooked 

    3. Fish processed and canned 

    4. Newspapers containing advertising material 

    Which of the above items is/are exempted under GST (Goods and Services Tax)? 

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

  • Satellite data show India’s major deltas sinking

    Why in the News

    A global study published in Nature on 14 January reports widespread land subsidence across India’s major river deltas, driven largely by human activities and observed using Sentinel 1 satellite data.

    Study at a Glance

    • Data source Interferometric Synthetic Aperture Radar from ESA Sentinel 1
    • Period 2014 to 2023
    • Coverage 40 major global deltas including 6 Indian deltas
    • Spatial resolution 75 metres
    • Population relevance Deltas support over 340 million people globally

    Indian Deltas Confirmed to be Sinking

    • Ganges Brahmaputra Delta, Brahmani Delta, Mahanadi Delta, Godavari Delta, Cauvery Delta and Kabani Delta.
    • More than 90 percent area affected in Ganges Brahmaputra, Brahmani and Mahanadi deltas.

    Key Quantitative Findings

    • Brahmani delta: 77 percent area sinking at more than 5 mm per year
    • Mahanadi delta: 69 percent area sinking at more than 5 mm per year
    • In Ganges, Brahmani, Mahanadi, Godavari and Kabani,
      Subsidence rate exceeds regional sea level rise
    • Godavari delta: Even 95th percentile subsidence exceeds projected global sea level rise under worst climate scenario
    • Kolkata: Subsidence equals or exceeds delta average due to urban load and resource extraction

    Major Human Drivers Identified

    • Unsustainable groundwater extraction: Ganges Brahmaputra and Cauvery deltas
    • Rapid urbanisation: Brahmani delta
    • Reduced sediment flux: Mahanadi and Kabani deltas
    • Population pressure: Intensifies compaction and land lowering
    [2018] Which of the following is/are the possible consequence/s of heavy sand mining in riverbeds? 

    1. Decreased salinity in the river 

    2. Pollution of groundwater 

    3. Lowering of the water-table 

    Select the correct answer using the code given below: 

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

  • [21st January 2026] The Hindu OpED: To compete with China, India may need China

    PYQ Relevance

    [UPSC 2019] “China is using its economic relations and positive trade surplus as tools to develop potential military power status in Asia.” In the light of this statement, discuss its impact on India as her neighbour.

    Linkage: China’s trade surplus enables strategic leverage that affects India’s security and economic autonomy. The article highlights how India’s dependence on Chinese inputs limits effective economic counterbalancing.

    Mentor’s Comment

    This article examines India’s evolving economic engagement with China amid global supply chain reconfiguration. It highlights a strategic paradox: while India seeks to reduce dependence on China, selective Chinese capital and manufacturing linkages may be essential for India’s export competitiveness, industrial upgrading, and integration into global value chains.

    Why in the News?

    India is considering removing the post-2020 restrictions on Chinese FDI imposed after the Galwan clash. This signals a shift away from a security-first approach that sharply reduced Chinese investment. Despite China’s FDI stock falling to 14th place by 2024, India’s trade dependence on China remains high, revealing a contradiction between geopolitical mistrust and India’s need for Chinese capital and components for manufacturing and exports.

    Why were Chinese FDI curbs imposed in 2020?

    1. Security Concerns: Introduced after the Galwan Valley clash to prevent opportunistic takeovers of Indian firms during economic distress.
    2. Policy Instrument: It mandated government approval for FDI from countries sharing land borders with India.
    3. Immediate Outcome: Sharp decline in new Chinese investments despite stable trade volumes.

    How has Chinese FDI in India changed since 2020?

    1. FDI Ranking Decline: China’s rank in India’s FDI inflows fell from 18th (2023) to 22nd (2024).
    2. FDI Stock Position: China’s cumulative FDI stock in India placed it at 14th position in 2024, down from 9th in 2014.
    3. Stock Value: Chinese FDI stock in India stood at approximately $4.25 billion in 2024, significantly lower than Hong Kong ($192 billion) or Singapore ($102.6 billion).

    Does trade data indicate economic decoupling?

    1. Trade Deficit Persistence: India’s trade deficit with China remained above $80 billion.
    2. Import Dependence: China continued to dominate India’s imports of electronics, telecom components, and industrial inputs.
    3. Smartphone Components: Over 60% of smartphone manufacturing components in India originate from China.

    Why is China critical to India’s manufacturing ambitions?

    1. Scale Advantage: China supplies intermediate goods at volumes and prices unmatched by alternative suppliers.
    2. Export Enablement: Chinese inputs support India’s exports to the U.S. and EU, particularly in electronics.
    3. PLI Limitation: Production-Linked Incentive schemes increased assembly but not upstream component manufacturing.

    Can India replace China in global supply chains without China?

    1. Substitution Constraint: No single country can replace China’s integrated supply chain ecosystem.
    2. Regional Spillovers: Vietnam and Thailand rely heavily on Chinese components despite hosting relocated manufacturing.
    3. Cost Impact: Higher tariffs on Chinese inputs raise costs and reduce export competitiveness.

    What does global data suggest about pragmatism over protectionism?

    1. U.S. Case: Despite tariffs, China accounted for over 22% of U.S. smartphone imports in 2024.
    2. EU Dependence: European Union imports from China rose steadily between 2019 and 2023.
    3. Policy Insight: Trade restrictions altered routes but not dependence.

    Conclusion

    India’s economic strategy requires selective engagement rather than exclusion. Chinese FDI and manufacturing linkages can support India’s export growth, technology absorption, and supply chain resilience. A calibrated, security-screened investment framework aligns better with India’s long-term industrial objectives than blanket restrictions.

  • The importance of Pax Silica for India

    Why in the News?

    In December 2025, the U.S. convened the first Pax Silica Summit to secure supply chains for critical minerals, semiconductors, and AI, moving away from China-centric globalisation. The initiative responds to China’s use of rare earths and technology inputs as strategic leverage. For India, it opens the possibility of becoming a trusted supply-chain partner, though capacity constraints remain.

    What is Pax Silica and why has it emerged now?

    Pax Silica is the U.S. Department of State’s flagship effort on AI and supply chain security, advancing new economic security consensus among allies and trusted partners.

    1. Strategic Framework: Integrates critical minerals, semiconductor manufacturing, AI infrastructure, and logistics into a trusted supply-chain network.
    2. Geopolitical Context: Responds to China’s dominance in rare earths and chip manufacturing inputs, and its ability to influence global flows.
    3. Supply-Chain Shock Lessons: Incorporates lessons from COVID-19 and trade disruptions that exposed vulnerabilities in concentrated production systems.
    4. Normative Shift: Moves away from efficiency-based globalisation towards resilience, trust, and political alignment.

    How does Pax Silica seek to restructure global technology supply chains?

    1. Coercive Dependency Reduction: Limits over-reliance on single-country control of critical minerals and manufacturing stages.
    2. Integrated Value Chains: Connects mining, processing, fabrication, logistics, and AI deployment across aligned economies.
    3. Trusted Digital Infrastructure: Promotes secure, interoperable systems for AI and data-intensive technologies.
    4. Selective Coalition Model: Operates through functional partnerships rather than universal multilateral institutions.

    Who are the key participants and what capabilities do they bring?

    1. United States: Anchors advanced semiconductor design, AI platforms, and strategic coordination.
    2. Japan: Contributes precision manufacturing, materials engineering, and chip equipment expertise.
    3. Australia: Supplies lithium and other critical minerals essential for batteries and advanced electronics.
    4. Netherlands: Hosts ASML, a global leader in advanced semiconductor lithography.
    5. South Korea: Provides manufacturing strength in memory chips and advanced fabrication.
    6. Israel: Leads in AI software, defence technologies, and cybersecurity.
    7. United Kingdom: Houses the world’s third-largest AI market and innovation ecosystem.
    8. Middle East Funds: Enable capital deployment through Qatar and UAE sovereign investment vehicles.
    9. Observer Economies: OECD and Taiwan participate without full membership, indicating graded engagement.

    Why is China central to the Pax Silica calculus?

    1. Rare Earth Dominance: Controls a significant share of global REE processing and magnet manufacturing.
    2. Export Controls: Uses trade restrictions as a strategic tool, impacting electronics and automotive industries.
    3. Manufacturing Centrality: Retains scale advantages in downstream electronics assembly.
    4. Strategic Leverage: Demonstrates capacity to weaponise supply chains during political disputes.

    What is India’s current position in the Pax Silica ecosystem?

    1. Digital Infrastructure Strength: Possesses large-scale digital public infrastructure and a growing AI market.
    2. Semiconductor Constraints: Lacks mature fabrication capacity and advanced chip manufacturing ecosystems.
    3. Human Capital Advantage: Hosts a large pool of engineers and returning AI researchers trained abroad.
    4. Policy Initiatives: Has launched semiconductor and AI missions with participation from domestic conglomerates.
    5. Collaborative Links: Engages with Israeli firms for chip fabrication plants and U.S. firms like Micron for assembly and testing.

    What challenges does India face in joining Pax Silica?

    1. Capability Gap: Risks being perceived primarily as a market rather than a technology contributor.
    2. Expectation Management: Faces a “participation gap” between allied expectations and domestic capacities.
    3. Policy Autonomy: Must balance strategic alignment with flexibility in industrial and trade policy.
    4. Regulatory Exposure: May face pressure to adjust export controls, subsidies, and government procurement norms.
    5. Asymmetric Benefits: Risks uneven gains if domestic ecosystem development lags behind integration.

    Conclusion

    Pax Silica reflects the consolidation of technology, security, and geopolitics into a single policy domain. For India, participation offers an opportunity to embed itself in trusted global supply chains, but only if accompanied by accelerated domestic capacity-building. Strategic engagement must prioritise ecosystem development, policy autonomy, and long-term technological self-reliance rather than symbolic alignment.

    PYQ Relevance

    [UPSC 2024] “The West is fostering India as an alternative to reduce dependence on China’s supply chain and as a strategic ally to counter China’s political and economic dominance.” Explain this statement with examples.

    Linkage: The West is promoting India to diversify supply chains away from China, particularly in semiconductors and critical technologies. This also positions India as a strategic partner to counter China’s growing political and economic influence.

  • How reusability can lead to sustainable, cost effective access to space

    Why in the News

    Reusable rocket technology has shifted space activities from government-controlled, single-use rockets to a commercial, reuse-based model. Private companies, especially SpaceX, have repeatedly recovered and reused rocket stages, cutting launch costs by nearly five times and allowing more frequent launches. With the global space economy expected to cross USD 1 trillion by 2030, reusability marks a fundamental break from earlier disposable launch systems that dominated for decades.

    Reusable rocket

    1. It is a spacecraft designed to launch, land, and be refurbished for multiple flights.
    2. It drastically cuts space access costs by reusing expensive components like the booster, with SpaceX’s Falcon 9 leading the way.
    3. How They Work (Key Technologies)
      1. Vertical Takeoff & Landing (VTVL): Rockets launch vertically and use engines, grid fins (like on Falcon 9), and landing legs for controlled descent and landing back on Earth.
      2. Advanced Software: Sophisticated flight computers and software manage complex maneuvers like boost-back burns, re-entry burns, and final landing.
      3. Fuel Reserve: Reusable rockets carry extra fuel to perform landing burns, making them heavier but efficient.
      4. Refurbishment: After landing, components are inspected, refurbished, and prepared for the next flight, reducing the need to build new rockets.

    How does rocket fuel mass constrain space launches?

    1. Rocket Equation Constraint: Demonstrates that most launch mass consists of fuel, leaving less than 3-4% for payload in conventional designs.
    2. Propellant Dominance: Requires carrying fuel to lift fuel, creating diminishing returns for payload capacity.
    3. Cost Implication: Increases launch expenses as entire systems are discarded after one mission.

    Why are rockets designed with multiple stages?

    1. Stage Separation: Allows discarding empty tanks and engines to reduce mass during ascent.
    2. Efficiency Gain: Improves thrust-to-weight ratio as the vehicle ascends.
    3. Conventional Limitation: Most stages are used once and destroyed, increasing per-launch costs.

    How has reusability altered rocket engineering economics?

    1. Stage Recovery: Enables retrieval of high-value components such as engines and avionics.
    2. Manufacturing Shift: Reduces dependence on repeated fabrication of complex propulsion systems.
    3. Launch Frequency: Supports rapid turnaround and higher mission cadence.

    What operational innovations enable reusable launch systems?

    1. Precision Landing: Uses autonomous guidance, grid fins, and controlled burns for vertical recovery.
    2. Thermal and Structural Design: Ensures engines and stages withstand re-entry heat and stress.
    3. Refurbishment Protocols: Introduces inspection, testing, and component replacement cycles.

    Can a recovered rocket stage be reused multiple times?

    1. Reuse Cycles: First stages of Falcon-9 rockets have been reused over 30 times.
    2. Economic Threshold: Savings from reuse outweigh refurbishment and inspection costs.
    3. Reliability Assurance: Requires rigorous testing to maintain safety and mission assurance.

    How does reusability improve sustainability in space operations?

    1. Material Efficiency: Reduces consumption of metals, composites, and rare components.
    2. Debris Reduction: Limits discarded stages that contribute to space and ocean debris.
    3. Environmental Impact: Lowers lifecycle emissions by minimizing repeated manufacturing.

    What are the limitations of reusable rocket technology?

    1. Engineering Trade-offs: Recovery systems add mass, reducing payload capacity.
    2. Thermal Stress: Engines face extreme heat cycles during re-entry and relaunch.
    3. Economic Ceiling: Excessive inspection or refurbishment can negate cost benefits.

    Where does India stand in reusable launch vehicle development?

    1. ISRO Initiatives: Working on reusable launch vehicles (RLVs), winged spaceplane concepts, and vertical landing experiments.
    2. Two-Stage Focus: Aims to achieve orbital missions with fewer stages through high-efficiency propulsion.
    3. Private Sector Entry: Indian startups are exploring recovery-based launch solutions.
    4. Future Direction: Emphasis on recovery, reuse, and refurbishment for competitive access to space.

    Conclusion

    Reusable launch systems redefine space access by replacing disposable rockets with recoverable transportation platforms. By lowering costs, increasing mission frequency, and reducing material waste, reusability strengthens both economic viability and sustainability of space operations. For India, adopting reusability is essential to remain competitive in a rapidly commercialising global space economy.

    PYQ Relevance

    [UPSC 2016] Discuss India’s achievements in the field of Space Science and Technology. How has the application of this technology helped India in its socio-economic development?

    Linkage: India’s achievements in space technology, low-cost launch systems, planetary missions, and indigenous satellites, demonstrate technological self-reliance and innovation. Their application has directly supported socio-economic development through communication, disaster management, navigation, weather forecasting, and governance efficiency (GS III: Space Technology & Development).

  • PM Modi highlights Parbati Giri’s contribution to freedom struggle

    Why in the news

    Prime Minister Narendra Modi paid tribute to Parbati Giri on her birth centenary, highlighting her role in India’s freedom movement and post independence social service. She was also remembered earlier in Mann Ki Baat.

    Who was Parbati Giri

    • Freedom fighter from Odisha
    • Known as “Mother Teresa of Western Odisha”
    • Actively participated in the Quit India Movement
    • Joined the freedom struggle at just 16 years of age

    Role in freedom struggle

    • Took part in the Quit India Movement of 1942
    • Represented the contribution of women and tribal regions in the national movement
    • Part of the broader mass based resistance against colonial rule

    Post-independence contributions

    • Dedicated her life to social service
    • Worked extensively for Tribal welfare, Healthcare and Women empowerment
    • Established orphanages and welfare institutions
    • Focused on upliftment of the poor and marginalised

    UPSC Prelims pointers

    • Parbati Giri was associated with Quit India Movement
    • Belonged to Odisha
    • Known for lifelong tribal and social welfare work
    • Frequently cited in context of unsung freedom fighters
    [2011] Which one of the following observations is not true about the Quit India Movement of 1942? 

    (a) It was a non-violent movement 

    (b) It was led by Mahatma Gandhi 

    (c) It was a spontaneous movement 

    (d) It did not attract the labour class in general

  • India expands GHG emission intensity regime to four more sectors

    Why in the news

    • The Union Government has expanded the Greenhouse Gas Emission Intensity reduction regime to four additional industrial sectors under amended rules notified by the Ministry of Environment, Forest and Climate Change.
    • The move operationalises India’s Carbon Credit Trading framework and strengthens compliance based climate mitigation.

    Newly included sectors

    • Petroleum refineries, Petrochemicals, Textiles, andSecondary aluminium
    • These are in addition to aluminium, cement, chlor alkali and pulp and paper sectors notified earlier.

    Coverage

    • 208 industrial units across India
      • 173 textile units
      • 21 petroleum refineries
      • 11 petrochemical units
      • 3 secondary aluminium units
    • Major public sector and private companies covered include
      • ONGC, Indian Oil, Bharat Petroleum, Hindustan Petroleum, Numaligarh Refinery and Reliance Industries.

    Legal and policy framework

    • Notified as Greenhouse Gases Emission Intensity Target Amendment Rules
    • Issued under the compliance mechanism of the Carbon Credit Trading Scheme, 2023
    • Enforced by the Central Pollution Control Board

    What is GEI (Greenhouse Gas Emission Intensity) target?

    • Mandatory reduction of GHG emissions per unit of output
    • Baseline year is 2023 to 24
    • Targets apply from 2025 to 26
    • Overall reduction of 3 to 7 percent by 2026 to 27

    Compliance and penalty

    • Units must either
      • Meet GEI targets
      • Or submit carbon credit certificates equal to the shortfall
    • Non compliance penalty
      • Imposed as environmental compensation by CPCB
      • Amount equals twice the average carbon credit price in that trading cycle
      • Payable within 90 days

    Climate significance

    • Aligns with India’s net zero target of 2070
    • Supports India’s Nationally Determined Contribution under the Paris Agreement
    • Promotes market driven decarbonisation instead of criminal penalties
    • Pushes energy efficiency and cleaner technologies in high emission sectors

    UPSC Prelims pointers

    • GEI focuses on emission intensity, not absolute emissions
    • Linked to Carbon Credit Trading Scheme 2023
    • Penalty equals 2 times average carbon credit price
    • Enforcement by CPCB
    • Supports India’s net zero 2070 pathway
    [2011] Regarding “carbon credits”, which one of the following statements is not correct? 

    (a) The carbon credit system was ratified in conjunction with the Kyoto Protocol

    (b) Carbon credits are awarded to countries or groups that have reduced greenhouse gases below their emission quota

    (c) The goal of the carbon credit system is to limit the increase of carbon dioxide emission

    (d) Carbon credits are traded at a price fixed from time to time by the United Nations environment programs

  • BNHS and NMCG launch project to protect Indian Skimmer

    Why in the news

    Bombay Natural History Society and National Mission for Clean Ganga have launched a new conservation project in Dehradun to protect the endangered Indian Skimmer in the Ganga Basin. The project was inaugurated by the Union Minister for Jal Shakti C R Patil.

    About Indian Skimmer

    • Scientific name: Rynchops albicollis
    • IUCN status: Endangered
    • Habitat: Large rivers, estuaries, sandbars and islands
    • India hosts around 90 percent of the global population, making conservation nationally critical.

    Core objective

    • Protection of river sandbars, which are crucial nesting and breeding habitats for Indian Skimmer and other riverine birds.

    Major threats addressed

    • Sand mining on riverbeds
    • Altered river flows and sudden water releases from dams
    • Human and livestock disturbance
    • Predation and habitat fragmentation

    Geographical coverage

    • National Chambal Sanctuary
    • Upper Ganga near Bijnor and Narora
    • Ganga Yamuna confluence at Prayagraj
    • Lower Ganga near the Vikramshila Gangetic Dolphin Sanctuary in Bihar

    UPSC Prelims pointers

    • Indian Skimmer nests on exposed river sandbars.
    • India holds the largest global population share of the species.
    • Project combines science, community participation, and river planning.
    • Linked with Namami Gange ecosystem restoration goals.
    [2014] With reference to Bombay Natural History Society (BNHS), consider the following statements: 1. It is an autonomous organization under the Ministry of Environment and Forests

    2. It strives to conserve nature through action-based research, education and public awareness

    3. It organizes and conducts nature trails and camps for the general public

    Which of the statements given above is/are correct? 

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

  • Environmental (Protection) Fund

    Why in the news

    The Union Government notified detailed rules in January 2026 to operationalise the Environmental (Protection) Fund, a reform enabled by the Jan Vishwas Act, 2023.

    About

    • A statutory fund of the Government of India created to channel environmental penalties into pollution control, restoration, monitoring, research, and capacity building.
    • Converts monetary penalties into direct environmental remediation.

    Legal basis

    • Provided under the Environment (Protection) Act, 1986.
    • Detailed rules notified in January 2026.
    • Strengthened by the Jan Vishwas Act, 2023, which decriminalised several environmental offences while retaining penalties.

    Nodal authority

    • Administered by the Ministry of Environment, Forest and Climate Change or any body notified by the Central Government.

    Aim

    • Ensure that pollution penalties are recycled for environmental protection, remediation, clean technology promotion, and stronger regulatory institutions.

    Key features

    • Sources of funds
      • Penalties under the Air Act 1981 and Environment Act 1986
      • Interest from investments
      • Other prescribed sources
    • Permitted uses (11 activities)
      • Pollution prevention and mitigation
      • Remediation of contaminated sites
      • Environmental monitoring equipment
      • Clean technology research
      • IT enabled regulatory systems
      • Laboratory infrastructure
      • Capacity building of regulatory bodies
    • Revenue sharing
      • 75% of penalty proceeds to the Consolidated Fund of the State or UT
      • 25% retained by the Centre
    • Governance: Dedicated Project Management Units at Central and State levels
    • Oversight and transparency
      • Audit by the Comptroller and Auditor General of India
      • Centralised online portal developed by the Central Pollution Control Board
    [2019] Consider the following statements: The Environment Protection Act, 1986 empowers the Government of India to: 

    1. State the requirement of public participation in the process of environmental protection, and the procedure and manner in which it is sought

    2. Lay down the standards for emission or discharge of environmental pollutants from various sources

    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

  • RBI proposes CBDC linkage on BRICS agenda

    Why in the news?

    Reserve Bank of India has advised the Government of India to place a proposal on linking Central Bank Digital Currencies (CBDCs) on the agenda of the BRICS 2026 Summit, which India will host.

    Key proposal

    • Link BRICS members’ CBDCs including India’s e-rupee for cross border trade finance and tourism payments.
    • Aim is faster settlements, lower transaction costs and reduced dependence on correspondent banking systems.
    • RBI clarifies this is not a formal de dollarisation push, but about efficiency and resilience.

    Background context

    • Builds on the 2025 BRICS Rio Declaration that called for interoperability of payment systems.
    • All core BRICS members Brazil Russia India China South Africa are running CBDC pilot projects, none fully launched yet.

    Central Bank Digital Currencies Vs Cryptocurrency

    • Issuing authority

        • CBDCs are issued and regulated by a country’s central bank such as the Reserve Bank of India
        • Cryptocurrencies are issued privately through decentralised blockchain networks with no sovereign authority, for example Bitcoin
    • Legal status

      • CBDCs are legal tender and must be accepted for payments within the issuing country
      • Cryptocurrencies are not legal tender in most countries and their legal status varies

    Strategic significance

    • Could challenge dollar centric payment rails indirectly amid rising geopolitical tensions.
    • Enhances international use of the rupee through regulated digital channels.
    • Fits India’s push for safe sovereign digital money over private stablecoins.

    Prelims pointers

    • CBDC is sovereign digital legal tender issued by a central bank.
    • RBI views CBDCs as less risky than stablecoins for monetary and financial stability.
    • BRICS was founded in 2009 and later expanded beyond the original five members.
    [2024] Consider the following statements in respect of the digital rupee: 

    1. It is a sovereign currency issued by the Reserve Bank of India (RBI) in alignment with its monetary policy

    2. It appears as a liability on the RBI’s balance sheet

    3. It is insured against inflation by its very design

    4. It is freely convertible against commercial bank money and cash

    Which of the statements given above are correct? 

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

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