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Type: Prelims Only

  • Appointment of DGP in Tamil Nadu

    Why in the News

    The Union Public Service Commission is set to convene a panel to shortlist candidates for the post of Director General of Police (DGP) in Tamil Nadu, following Supreme Court guidelines on police reforms.

    What is DGP

    • Director General of Police (DGP) is the highest ranking police officer in a State
    • Heads the State Police Force
    • Also referred to as Head of Police Force (HoPF)

    Appointment Process

    • UPSC forms a panel of three senior IPS officers
    • Panel sent to State Government
    • State selects one officer as DGP

    Role of UPSC

    • Ensures merit based and transparent selection
    • Conducts Empanelment Committee Meeting (ECM)

    Key Supreme Court Guidelines

    (From Prakash Singh v Union of India, 2006)

    • DGP should have a minimum tenure of 2 years
    • Selection from panel prepared by UPSC
    • Officers should have minimum residual service
    • Appointment should not be made just before retirement

    Important Terms

    • Empanelment Committee Meeting (ECM): Meeting conducted by UPSC to shortlist eligible officers
    • Residual Service: Remaining service period before retirement

    Key Issues Highlighted

    • Delays in appointment process
    • Debate over extension beyond retirement
    • Ensuring independence and stability of police leadership

    Significance

    • Strengthens police reforms and accountability
    • Ensures professional and merit based appointments
    • Reduces political interference in policing
    [2019] With reference to the Chief Secretary of a state, consider the following statements: 
    1. Chief Secretary is appointed by the Governor of the state for a fixed tenure of two years. 
    2. The Central government has the power to approve extension of service of Chief Secretary for a period not exceeding six months. 
    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

  • Kailash Mansarovar Yatra and Lipulekh Dispute

    Why in the News?

    Ahead of the Foreign Secretary’s visit, Nepal has raised concerns with India and China over the Kailash Mansarovar Yatra route via Lipulekh Pass, reiterating its territorial claim over the region.

    About Kailash Mansarovar Yatra

    • Pilgrimage to:
      • Mount Kailash
      • Lake Mansarovar
    • Conducted by India in coordination with China
    • Major routes:
      • Lipulekh Pass (Uttarakhand)
      • Nathu La Pass (Sikkim)

    What is Lipulekh Pass

    • A high altitude mountain pass in the Himalayas
    • Located at the tri junction of:
      • India
      • Nepal
      • China
    • Used as a traditional route for the yatra since 1954

    Nature of the Dispute

    • Nepal claims:
      • Kalapani, Lipulekh, Limpiyadhura belong to Nepal
      • Based on Treaty of Sugauli
    • India’s position:
      • Claims not supported by historical evidence
      • Open to resolution through dialogue and diplomacy

    Key Regions Involved

    • Kalapani
    • Lipulekh
    • Limpiyadhura
    • Located near Mahakali River

    Strategic Importance

    • Important for:
      • Pilgrimage route (Kailash Mansarovar)
      • India China trade and connectivity
    • Sensitive due to:
      • Tri junction location
      • Geopolitical significance
    [2019] Consider the following pairs 
    Glacier – River 
    1 Bandarpunch – Yamuna 
    2 Bara Shigri – Chenab 
    3 Milam – Mandakini 4 Siachen – Nubra 
    5 Zemu – Manas 
    Which of the pairs correctly matched? 
    a) 1, 2 and 4 
    b) 1, 3 and 4 
    c) 2 and 5 
    d) 3 and 5

  • Nilgiri Class Frigate Mahendragiri 

    Why in the News

    The Indian Navy has inducted INS Mahendragiri, the sixth ship of the Nilgiri class (Project 17A), strengthening India’s naval combat capability and indigenous defence manufacturing.

    Key Facts

    • Name: INS Mahendragiri
    • Class: Nilgiri class stealth frigate
    • Project: Project 17A
    • Built by: Mazagon Dock Shipbuilders Limited
    • Location: Mumbai
    • Designed by: Warship Design Bureau (India)

    Features of Project 17A Frigates

    • Advanced stealth technology
    • Multi mission capability:
      • Anti surface warfare
      • Anti air warfare
      • Anti submarine warfare
    • Equipped with:
      • Advanced sensors
      • Modern weapons systems

    Propulsion System

    • CODOG (Combined Diesel or Gas)
    • Allows:
      • Efficient cruising (diesel)
      • High speed operations (gas turbine)

    Indigenous Capability

    • Around 75 percent indigenous content
    • Involvement of: 200 plus MSMEs
    • Employment generated:
      • 4000 direct jobs
      • 10000 indirect jobs
    [2025] With reference to India’s defence, consider the following pairs: 
    Aircraft type : Description 
    1 Dornier-228 : Maritime patrol aircraft 
    2 IL-76 : Supersonic combat aircraft 
    3 C-17 Globemaster III : Military transport aircraft 
    How many of the pairs given above are correctly matched? 
    (a) Only one (b) Only two (c) All the three (d) None

  • India’s Power Demand, Solar Push and Coal Use amid El Niño 

    Why in the News

    India is preparing to meet rising summer power demand and possible El Niño conditions by relying on a mix of augmented solar capacity and coal based thermal power.

    Key Highlights

    • Peak power demand reached around 256 GW (April 2026)
    • Thermal power share: about 66.9 percent
    • Solar contribution increased to about 21.5 percent
    • Record addition of 44.61 GW solar capacity in 2025–26

    Role of Solar Energy

    • Rapid increase in installed capacity
    • Solar share in generation rising steadily:
      • Around 5.6 percent (2022)
      • Around 9 percent (2025)
    • Limitations:
      • Intermittent nature
      • Lack of sufficient battery storage
      • Grid stability concerns

    Role of Coal Based Thermal Power

    • Continues to be dominant source of electricity
    • Ensures base load supply during peak demand
    • Current coal stock: ~200 million tonnes
    • Sufficient for about 80 plus days

    What is El Niño?

    • A climate phenomenon involving warming of Pacific Ocean waters
    • Leads to:
      • Weaker monsoon in India
      • Longer dry spells and heatwaves
    [2023] Consider the following statements: 
    Statement-IIndia, despite having Uranium deposits, depends on coal for most of its electricity production. 
    Statement-II:Uranium, enriched to the extent of at least 60%, is required for the production of electricity. 
    Which one of the following is correct in respect of the above statements 
    [A] Both Statement-I and Statement – II are correct and Statement- II is the correct explanation for Statement- I 
    [B] Both Statement I and Statement II are correct and Statement-II is not the correct explanation for Statement-I. 
    [C] Statement- I is Correct but Statement-II is incorrect. 
    [D] Statement-I incorrect but Statement-II is correct.

  • RBI’s New Bad Loan Norms (ECL Framework) 

    Why in the News

    The Reserve Bank of India has introduced a new framework based on Expected Credit Loss (ECL) for provisioning of bad loans, which may lead to a short term increase in costs for banks.

    What is Expected Credit Loss (ECL)

    • A forward looking approach to estimate loan losses
    • Considers future risk of default rather than past defaults
    • Aligns with global standard IFRS 9

    Key Features of New Norms

    Three Stage Classification of Loans

    • Stage 1: Low or no credit risk
      • Provision based on 12 month ECL
    • Stage 2: Significant increase in credit risk
      • Provision based on lifetime ECL
    • Stage 3: High credit risk or default
      • Provision based on lifetime ECL

    Important Changes

    • Borrower Level NPA Classification: If one loan becomes NPA, all loans of the borrower become NPA
    • NPA Definition: Loan classified as NPA if overdue for more than 90 days
    • Upgrade Rule: Borrower must repay all dues to become a standard asset again

    Impact on Banks

    • Possible increase in provisioning requirements
    • Short term reduction in profits
    • Impact on capital (CET 1 ratio)
    • Higher impact on:
      • Microfinance lending
      • Unsecured retail loans

    Key Terms

    • Non Performing Asset (NPA): Loan where repayment is overdue beyond 90 days.
    • Provisioning: Setting aside funds by banks to cover potential loan losses.
    • CET 1 (Common Equity Tier 1): Core capital of banks used to absorb losses.
    [2021] Consider the following statements: 
    1.Capital Adequacy Ratio (CAR) is the amount that banks have to maintain in the form of their own funds to offset any loss that banks incur if any account-holders fail to repay dues. 
    2.CAR is decided by each individual bank. 
    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

  • Komagata Maru Incident (1914) 

    Why in the News

    The Komagata Maru incident (1914) has resurfaced in public discourse after references in global media, highlighting racist immigration policies under colonial rule and its role in India’s freedom movement.

    About Komagata Maru

    • Ship: Komagata Maru (also called Guru Nanak Jahaz)
    • Chartered by: Gurdit Singh
    • Origin: Hong Kong
    • Destination: Vancouver, Canada
    • Passengers: 376 Indians
      • Majority Sikhs, along with Muslims and Hindus

    Timeline of Events

    • April 1914: Ship leaves Hong Kong
    • May 1914: Arrives at Vancouver
    • Only 24 passengers allowed entry
    • Remaining passengers denied entry and kept on ship for 2 months
    • July 1914: Ship forced to return to India

    Reason for Denial of Entry

    • Canadian law: Continuous Journey Regulation (1908)
      • Required migrants to travel directly without stops from their country
    • Aimed to restrict Asian immigration
    • Influenced by racist groups like the Asiatic Exclusion League

    Events on Return to India

    • Ship reached Budge Budge (near Kolkata)
    • British authorities tried to send passengers to Punjab
    • Passengers resisted
    • Police opened fire
      • 20 people killed
      • Many injured
    [2014] The Ghadr (Ghadar) was a: 
    (a) revolutionary association of Indians with headquarters at San Francisco. 
    (b) nationalist organization operating from Singapore. 
    (c) militant organisation with headquarters at Berlin. 
    (d) Communist movement for India’s freedom with headquarters at Tashkent.

  • FDI Inflows in India 

    Why in the News?

    India’s Foreign Direct Investment (FDI) inflows are expected to cross 90 billion dollars in FY 2025–26, according to the Department for Promotion of Industry and Internal Trade (DPIIT).

    Key Facts

    • FDI inflows (April–February 2025–26): 88 billion dollars
    • Expected total for FY 2025–26: over 90 billion dollars
    • Indicates strong investor confidence in India

    What is Foreign Direct Investment (FDI)

    • Investment by a foreign entity in:
      • Business operations
      • Assets in another country
    • Involves long term interest and control

    Key Drivers of Rising FDI

    • Economic reforms by the government
    • Expansion of Free Trade Agreements (FTAs)
    • Strong economic growth prospects
    • Improved ease of doing business

    Types of FDI

    • Greenfield Investment: Setting up new business operations
    • Brownfield Investment: Investment in existing companies or assets

    Role of DPIIT

    • Works under the Ministry of Commerce and Industry
    • Responsible for:
      • FDI policy formulation
      • Promotion of industrial development
      • Facilitating investment inflows

    Significance

    • Boosts economic growth and employment
    • Brings technology and expertise
    • Strengthens infrastructure and manufacturing
    • Improves balance of payments position
    [2020] With reference to Foreign Direct Investment in India, which one of the following is considered its major characteristic? 
    (a) It is the investment through capital instruments essentially in a listed company. 
    (b) It is a largely non-debt creating capital flow. 
    (c) It is the investment which involves debt-servicing. 
    (d) It is the investment made by foreign institutional investors in the Government securities.

  • FII Outflows and Rupee Depreciation 

    Why in the News

    Foreign investors have withdrawn ₹60,847 crore from Indian equity markets in April 2026, leading to a sharp depreciation of the Indian rupee, which touched nearly ₹95 per dollar.

    Foreign Institutional Investor (FII)

    While the terms FPI and FII are often used interchangeably, there is a technical distinction based on the 2014 SEBI regulations which merged several categories into the FPI regime.

    • Definition: FIIs are large entities (like Pension Funds, Mutual Funds, Investment Trusts) registered in a country outside India that propose to invest in Indian financial markets.
    • Consolidation: Previously, there were FIIs and QFIs (Qualified Foreign Investors). To simplify the process, SEBI introduced the Foreign Portfolio Investor (FPI) Regulations, 2014, effectively making FIIs a part of the broader FPI category.
    • Key Distinction: FPI is the investment, whereas FII is the institutional entity that performs the investment.
    FeatureFDIFPIFII
    Primary GoalManagement control & long-term growthCapital gains & dividendsInstitutional portfolio diversification
    Investment AssetPhysical assets (factories, land)Financial assets (stocks, bonds)Financial assets (stocks, bonds)
    DurationLong-termShort to Medium-termShort to Medium-term
    ComplexityHigh (involves legal & operational setup)Low (easy to trade via exchanges)Low (but requires regulatory registration)
    VolatilityVery LowHighHigh
    Who Invests?Multinational corporationsIndividuals or InstitutionsLarge organizations (e.g., Pension Funds)
    [2022] Consider the following statements: 
    1 Tight monetary policy of US Federal Reserve could lead to capital flight. 
    2 Capital flight may increase the interest cost of firms with existing External Commercial Borrowings (ECBs). 
    3 Devaluation of domestic currency decreases the currency risk associated with ECBs. 
    Select the correct answer using the code given below: 
    (a) 1 and 2 only (b) 2 and 3 only (c) 1 and 3 only (d) 1, 2 and 3

  • India’s First Green Methanol Plant 

    Why in the News

    India is set to establish its first green methanol plant at Kandla using the invasive plant Prosopis juliflora as feedstock. The project aims to produce clean marine fuel and support India’s transition to green shipping.

    About Prosopis juliflora

    • A Mexican-origin invasive species
    • Known locally as:
      • Vilayati Keekar (North India)
      • Gando Baval (Gujarat)
    • Introduced in India:
      • 1920s by British
      • Later in 1961 in Gujarat to check desertification
    • Problem:
      • Replaces native grasses
      • Harms biodiversity in Banni grasslands (Kutch)

    About Green Methanol

    • Methanol produced using renewable biomass instead of fossil fuels
    • Used as marine fuel replacing bunker oil
    • Helps reduce emissions significantly

    Key Features of the Project

    • Location: Deendayal Port Authority
    • Production capacity: 5 tonnes per day
    • Developed by: Thermax and Ankur Scientific
    • Feedstock:
      • Prosopis juliflora
      • Other biomass like bagasse and cotton stalk
    [2018] Why is a plant called Prosopis juliflora often mentioned in news? 
    (a) Its extract is widely used in cosmetics. 
    (b) It tends to reduce the biodiversity in the area in which it grows. 
    (c) Its extract is used in the synthesis of pesticides. 
    (d) None of the above.

  • Revenue Deficit and Fiscal Stress in States 

    Why in the News

    The Ministry of Finance in its Monthly Economic Review (April 2026) has warned that several Indian States with revenue deficits and high debt burdens may face fiscal stress, especially during economic shocks.

    What is Revenue Deficit

    • Occurs when revenue expenditure exceeds revenue receipts
    • Revenue expenditure includes:
      • Salaries
      • Pensions
      • Subsidies
      • Interest payments
    • Revenue receipts include:
      • Taxes
      • Fees
      • Non tax revenues

    Key Findings

    • Out of 18 major States analysed:
      • 9 States projected to have revenue deficit
      • 7 States projected to have revenue surplus
      • 1 State in revenue balance

    States with Revenue Deficit (Important)

    • Himachal Pradesh, Punjab, Kerala, Andhra Pradesh, Rajasthan, Haryana, Karnataka, Maharashtra, and Chhattisgarh.
    • Punjab has highest interest burden (22.8 percent of revenue receipts)

    States with Revenue Surplus

    • Odisha, Jharkhand, Uttar Pradesh, Goa, Gujarat, Uttarakhand, Telangana, and Bihar

    Key Concept

    • Golden Rule of Fiscal Policy
      • Governments should borrow only for capital expenditure
      • Revenue deficit should ideally be zero

    Fiscal Concerns

    • High interest payments reduce fiscal flexibility
    • Revenue deficit States may:
      • Cut productive expenditure (capital spending)
      • Seek higher central transfers
    • Limited ability to respond to economic shocks
    [2025] Suppose the revenue expenditure is ₹ 80,000 crores and the revenue receipts of the Government are ₹ 60,000 crores. The Government budget also shows borrowings of ₹ 10,000 crores and interest payments of ₹ 6,000 crores. Which of the following statements are correct? 
    I. Revenue deficit is ₹ 20,000 crores. 
    II. Fiscal deficit is ₹ 10,000 crores. 
    III. Primary deficit is ₹ 4,000 crores. 
    Select the correct answer using the code given below. 
    [A] I and II only [B] II and III only [C] I and III only [D] I, II and III