UPSC Daily Current Affairs: 15th July 2025 | Current Affairs & Hindu Analysis: Daily, Weekly & Monthly PDF Download

GS3/Economy

Why is Corporate Investment Lagging Behind?

Source: The Hindu

Why in News?

Recently, India's industrial output growth has dropped to a nine-month low of 1.2%, raising concerns about sluggish corporate investment despite measures such as tax cuts, increased public capital expenditure, and monetary easing. This situation has reignited discussions on the factors contributing to low investment levels, with notable references to Marxist economic theories, particularly those of Rosa Luxemburg and Mikhail Tugan-Baranovsky, who stress the necessity of demand revival for economic rejuvenation.

Key Takeaways

• Slow corporate investment in India is compounded by weak consumer demand.
• Excess industrial capacity has led firms to hesitate in expanding production.
• Misinterpretations about the relationship between profits and investments are prevalent.

Additional Details

• Weak Consumer Demand: Despite improved corporate profits, investment remains low due to insufficient consumer demand. For instance, even after a significant corporate tax cut from 30% to 22% in 2019, private sector investment in machinery and intellectual property grew only 35% from FY20 to FY23, as highlighted in the 2024-25 Economic Survey.
• Excess Industrial Capacity: Many industries are operating below optimal capacity, leading to reluctance in investing in new production facilities. Following the COVID-19 pandemic, underutilized factories have resulted in firms having little incentive to expand, even with low interest rates.
• Misreading of Profit-Investment Link: The common belief that higher profits directly lead to more investment is flawed. According to economist Michał Kalecki, it is often the case that investment drives profits. Without a revival in demand, companies are cautious about investing, regardless of profitability, due to uncertainties about returns.
• Rosa Luxemburg and Mikhail Tugan-Baranovsky: Luxemburg critiqued capitalist accumulation, emphasizing that capitalists base their investment decisions on anticipated demand. Conversely, Baranovsky argued that investment can generate its own market, though this view is contested by Luxemburg's emphasis on demand-driven investment.

In conclusion, to stimulate corporate investment, it is crucial to revive demand through effective government strategies, as consumer spending and confidence are key drivers for economic growth.

GS3/Environment

Government Backs New SO2 Emission Norms

Source: Indian Express

Why in News?

The Union Environment Ministry has recently defended its decision to revise the SO₂ emission norms for thermal power plants. The ministry justified exempting several coal- and lignite-based plants from mandatory flue gas desulphurization (FGD) retrofits, citing evidence, emission trends, and sustainability considerations. It also stated that there is no major difference in ambient SO₂ levels across cities with and without this technology, countering accusations of regulatory relaxation.

Key Takeaways

• Sulphur Dioxide (SO₂): A significant air pollutant released mainly from coal-fired power plants.
• India's Emissions: India is the world's largest emitter of SO₂, contributing over 20% of global emissions.
• Revised Norms: New classifications for emission compliance based on plant location and pollution level.

Additional Details

• Health Risks: SO₂ can cause serious respiratory issues, including asthma and bronchitis, and is a precursor to PM2.5, which is linked to severe health problems like heart attacks and strokes.
• Environmental Impact: SO₂ contributes to acid rain, adversely affecting soil, water bodies, and plant life.
• Current Emission Levels: Despite a decline in SO₂ levels, certain regions, particularly the Indo-Gangetic Plain and central India, still experience high concentrations.
• Policy Rationale: The ministry's rationale includes findings that show no significant public health differences between cities with FGD installations and those without, alongside the high costs associated with retrofitting all plants.
• Categories of Plants:
  • Category A: Plants near major cities must comply by end-2027.
  • Category B: Plants near critically polluted areas subject to case-by-case evaluation.
  • Category C: Majority of plants exempt from SO₂ norms but must meet stack height requirements.
• Cost Consideration: Retrofitting all plants would cost approximately ₹2.54 lakh crore, leading to a focus on the most impactful areas instead.
• Global Standards: India's SO₂ emission standards are stricter than those of several developed nations, such as Japan and Australia.

In conclusion, the revised SO₂ emission norms aim to balance environmental health with economic feasibility, directing regulatory efforts to areas where they can have the most significant impact.

GS2/International Relations

India’s Strategic Focus on West Africa

Source: The Hindu

Why in News?

Despite the growing influence of China in financing and infrastructure development in West Africa, India remains a key partner for Nigeria, the largest economy and democracy on the continent. This ongoing relationship underlines India's strategic objectives in the region.

Key Takeaways

• Strengthening bilateral relations with Nigeria.
• Enhancing security cooperation to combat terrorism and piracy.
• Establishing development partnerships through loans and capacity-building.
• Promoting common goals within the Global South framework.

Additional Details

• Strengthening Bilateral Relations: India seeks to enhance its strategic partnership with Nigeria, influencing broader regional dynamics in West Africa.
• Focus on Security Cooperation: India aims to bolster security collaboration, particularly against threats like Boko Haram.
• Development Partnerships: By providing concessional loans, India positions itself as a supportive partner in Nigeria's socio-economic growth.
• Economic Ties Enhancement: India plans to revitalize trade with Nigeria through agreements like the Economic Cooperation Agreement (ECA) and the Bilateral Investment Treaty (BIT).
• Cultural Exchanges: By promoting people-to-people interactions, India aims to foster goodwill and mutual understanding between the nations.

Challenges Faced by India

• Geopolitical Competition: China's dominance in various sectors in Nigeria poses challenges for India’s aspirations.
• Economic Fluctuations: A decline in trade from $14.95 billion in 2021-22 to $7.89 billion in 2023-24 due to global market changes.
• Political Instability: An unpredictable political landscape in Nigeria can hinder long-term investments.
• Capacity Constraints: Local capacity issues may affect the effectiveness of India's developmental initiatives.

Way Forward

• Deepen Strategic Collaboration: Strengthen partnerships in defense and security, and diversify trade in key sectors.
• Focus on Regional Capacity Building: Tailor developmental assistance to local needs while supporting Nigeria's stability through diplomatic engagement.

These strategies aim to not only enhance India's influence in West Africa but also ensure mutual growth in the region amidst existing challenges.

GS3/Economy

The India Inequality Debate - Misinterpretation of Gini Index and the Clash of Data Credibility

Source: The Wire India

Why in News?

The ongoing debate regarding inequality in India has gained attention, particularly with claims that India is one of the most equal societies globally, based on the Gini index of consumption. This controversy underscores major misinterpretations and discrepancies among various entities, including the Government of India, the World Bank, media, and independent researchers, about how inequality is assessed. The implications of this discussion are significant for data integrity, policymaking, and socio-economic analysis.

Key Takeaways

• The Gini Index measures the distribution of income, wealth, or consumption within a society.
• India's ranking as the "4th most equal society" is based on misinterpretations of the consumption Gini.
• There is no official data on income inequality in India, creating a gap in global rankings.
• Critics highlight the flawed comparisons and the need for reliable data sources.

Additional Details

• Gini Index: This index ranges from 0 to 100, where 0 indicates perfect equality and 100 indicates absolute inequality. The higher the Gini Index, the greater the inequality within a country.
• Misinterpretation of Rankings: According to the Observer Research Foundation (ORF), India was reported to have the lowest consumption Gini (25.5) in 2022-23, suggesting it is the most equal in terms of consumption.
• Government and Media Missteps: Political endorsements of the claim that India is the 4th most equal society have caused confusion between social equality and consumption equality.
• Criticism of Data Sources: The usage of synthetic data from the World Inequality Database (WID) has been criticized for its lack of credibility compared to official survey data.
• World Bank's Role: The World Bank's Poverty Inequality Platform (PIP) offers verified data but highlights contradictions by quoting WID's synthetic income Gini while presenting consumption data.
• Need for Official Surveys: The lack of official income surveys in India raises questions about the validity of inequality assessments and comparisons.

In conclusion, this debate highlights the urgent need for India to conduct official income surveys to facilitate meaningful comparisons and reflects the importance of data transparency and methodological rigor in socio-economic assessments.

GS3/Economy

Challenges in the Implementation of PLI Schemes

Source: India Briefing

Why in News?

Currently, six out of the fourteen Production-Linked Incentive (PLI) schemes, including those for textiles, solar modules, IT hardware, automobiles, advanced chemical cells (ACC), and specialty steel, are experiencing slower progress than anticipated.

Key Takeaways

• Many industries face stringent eligibility criteria limiting participation.
• Establishing manufacturing bases is a lengthy process, causing delays in employment generation.
• Access to critical resources is hindered, affecting production ramp-up.
• Some sectors remain reliant on imports, limiting growth under the PLI framework.
• Slow disbursement of funds has been a significant barrier in initial years.

Additional Details

• Stringent Eligibility Norms: The high eligibility criteria restrict many companies from benefiting from PLI schemes.
• Initial Setup Challenges: Industries such as solar modules and ACC require substantial time (1.5 to 3 years) to set up, delaying job creation.
• Market Dependency: Sectors reliant on imports have not transitioned to self-sufficiency, affecting growth potential.
• Textiles Sector: High competition and stringent norms have led to reduced participation and slower growth.
• Solar Modules: With a capacity of 77.2 GW for solar modules but only 7.6 GW for solar cells as of June 2024, supply shortages have delayed projects.
• Automobiles: Initial setup challenges and fluctuating market conditions hinder overall sector progress.
• Advanced Chemical Cells (ACC): Long commissioning periods and substantial investment needs contribute to slow growth.
• IT Hardware: Despite increased funding, implementation lags behind sectors like mobile manufacturing.

To enhance the effectiveness of PLI schemes, measures such as revising eligibility criteria, increasing support for supply chains, streamlining resource access, conducting regular reviews, and encouraging ancillary industries should be considered. These steps could significantly improve participation and growth across various sectors.

GS3/Economy

Inflation Hits 77-Month Low

Source: TOI

Why in News?

India's inflation indicators have shown a significant downward trend. The Consumer Price Index (CPI) has dropped to a remarkable 77-month low of 2.1% in June 2025, while the Wholesale Price Index (WPI) has contracted by -0.13%, marking its first decline in 20 months.

Key Takeaways

• Inflation has decreased to 2.1%, the lowest level since January 2019.
• The WPI has experienced a contraction of -0.13%.
• Food and Beverages (CPI component) registered a deflation of 0.2%, down from 8.4% in June 2024.
• WPI Food Articles saw a sharp fall of 3.75%, compared to 11.1% inflation in June 2024.
• Crude Petroleum and Natural Gas (WPI) prices contracted by 12.3%, marking the 10th consecutive month of decline.
• Inflation in Fuel and Light (CPI) eased to 2.55%, down from 2.8% in May 2025.
• Housing inflation increased marginally to 3.24%, while Pan, Tobacco, and Intoxicants remained stable at 2.4%.

Additional Details

• Consumer Price Index (CPI): Measures the change in retail prices of goods and services consumed by households.
• Wholesale Price Index (WPI): Measures wholesale prices of goods traded between businesses.
• Compiled By: CPI is compiled by the National Statistical Office (NSO), while WPI is compiled by the Office of Economic Adviser, Ministry of Commerce and Industry.
• Base Year: CPI has a base year of 2012 (with CPI for Industrial Workers using 2016), while WPI uses 2011-12.
• Coverage: CPI covers both goods and services, whereas WPI includes only goods.
• Data Collection: CPI gathers prices from 1,181 villages and 1,114 urban markets, while WPI collects data from wholesale markets and factories.
• Publication Frequency: Both indices are published monthly.

In conclusion, the significant drop in both CPI and WPI indicates a cooling inflationary trend in India's economy, which can have various implications for monetary policies and economic decision-making.

GS2/International Relations

The Importance of India and Europe Walking in Step

​Source: The Hindu

Why in News?

In a world marked by geopolitical uncertainty and shifting alliances, the relationship between India and Europe emerges as a vital strategic partnership. This collaboration, grounded in historical ties, is increasingly relevant in navigating contemporary global challenges.

Key Takeaways

• The India-Europe partnership is evolving from historical aloofness to proactive engagement.
• Both regions are committed to promoting a multipolar global order based on shared values.
• Economic synergies are evident with a significant increase in EU investments in India.
• Collaborative efforts in technology, defense, and governance highlight mutual interests and strengths.

Additional Details

• Historical Context: Traditionally, India and Europe have been marginal in each other's strategic considerations. Recent diplomatic efforts reflect a shift towards more active collaboration, driven by global changes.
• Strategic Autonomy: European nations are reassessing their foreign policies, especially post-Trump, leading to a focus on strengthening ties with India.
• Economic Cooperation: EU foreign direct investment in India has surged, with a remarkable increase of 70% from 2015 to 2022, underscoring India's growing economic significance.
• Digital Collaboration: India's expertise in digital innovation complements Europe’s capabilities in deep tech and manufacturing.
• Defense and Security: Both regions are focusing on co-development and technology transfer in defense, addressing shared security challenges, including terrorism and maritime security.
• Global Governance: India and Europe share a commitment to upholding a rules-based international order, advocating for equitable frameworks that benefit the Global South.
• Cultural Exchange: Enhanced cultural diplomacy is essential for fostering a deeper understanding and appreciation of each other’s aspirations and challenges.

The India-Europe relationship has transitioned from a mere possibility to a crucial necessity for both regions, contributing significantly to global stability. By embracing a future-oriented vision and moving beyond historical constraints, India and Europe can establish a powerful model of collaboration that benefits not just themselves but also the broader international community.

GS3/Economy

ADEETIE Scheme

Source: TOI

Why in News?

The Union Ministry of Power has recently introduced a national initiative known as the Assistance in Deploying Energy Efficient Technologies in Industries & Establishments (ADEETIE). This scheme aims to bolster energy efficiency across various sectors, particularly focusing on Micro, Small, and Medium Enterprises (MSMEs).

Key Takeaways

• The ADEETIE scheme promotes energy efficiency to reduce energy consumption, emissions, and enhance the competitiveness of MSMEs.
• It supports India’s climate objectives, including a target to reduce emission intensity by 45% by 2030 and achieve Net Zero by 2070.
• The scheme has a budget allocation of ₹1,000 crore, specifically aiming at MSMEs, excluding large enterprises.

Additional Details

• Launch: The ADEETIE scheme was launched by the Bureau of Energy Efficiency (BEE).
• Interest Subsidy Support: MSMEs adopting energy-efficient technologies will benefit from interest subsidies on loans, which are set at 5% for small enterprises and 3% for medium enterprises.
• Digital Portal Utility: A comprehensive digital platform will serve as a one-stop portal for financing, project development, and sharing knowledge on energy-efficient solutions.
• Supported Technologies:The scheme encourages the adoption of advanced clean technologies, including:
  • Automation and digital control systems
  • Combustion control systems for boilers
  • Methane capture technology
  • Air-dyeing in textiles
• Collaboration: The scheme promotes partnerships within the industry through Memoranda of Understanding (MoUs) with significant MSME associations.
• Legal Backing: The ADEETIE scheme aligns with the Energy Conservation (Amendment) Act, 2022, which facilitates carbon markets and mandates the use of clean energy.

The ADEETIE initiative signifies a crucial step towards enhancing energy efficiency in India's MSME sector, ultimately contributing to the nation’s broader climate goals and economic sustainability.

UPSC 2016

On which of the following can you find the Bureau of Energy Efficiency Star Label?

• 1. Ceiling fans
• 2. Electric geysers
• 3. Tubular fluorescent lamps

Select the correct answer using the code given below:

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

GS1/Geography

Great Trigonometric Survey (GTS)

Source: The Hindu

Why in News?

This newscard highlights the significant contribution of Indian assistants in completing the Great Trigonometric Survey (GTS), which commenced in 1802 to meticulously map the geography of India.

Key Takeaways

• The GTS was an extensive scientific initiative aimed at mapping India with exceptional precision.
• It utilized trigonometry and geodesy, led by British officials under the East India Company.
• Indian assistants played a crucial role in the success of the survey, contributing through various skilled and manual tasks.

Additional Details

• Launch and Objective: The GTS was initiated in 1806 by the British, conceptualized by Colonel William Lambton, to accurately measure the Earth's curvature and create precise maps for colonial administration and scientific research.
• Survey Method: The survey employed triangulation, forming a network of interconnected triangles from a known baseline to calculate distances and angles over extensive areas.
• First Baseline: The initial baseline was established in 1802 at St. Thomas Mount near Madras (Chennai), extending over 2,600 km up to the Himalayas.
• Instruments Used: The survey utilized large theodolites and measuring chains, necessitating substantial manpower for equipment operation and transport.
• Scientific Outcome: This effort led to the formulation of the Everest Spheroid, which remains a vital geodetic reference model in South Asia.
• Duration and Leadership: Originally planned for five years, the project extended to nearly 70 years, concluding in 1871, with leadership transitions including figures like George Everest and Andrew Scott Waugh.

Impact of GTS on Mapping India

• First Accurate Maps: GTS produced scientifically reliable maps that corrected previous inaccuracies, establishing modern geodetic frameworks essential for administration and infrastructure.
• Survey Range: The survey encompassed areas from southern India to the Himalayas, facilitating comprehensive development and precise scientific measurements.
• Great Arc Measurement: It measured a significant geodetic arc from Chennai to Dehradun, aiding in the calculation of Himalayan heights.
• Mount Everest Identification: In 1852, Peak XV was identified as the highest mountain globally, later named in honor of George Everest.
• Latitude-Longitude System: The survey established accurate longitude and latitude coordinates, crucial for navigation and military logistics.
• Infrastructure Impact: Survey benchmarks supported the development of railways, roads, canals, and ongoing earthquake studies, many of which are still relevant today.

Contribution of Indians to the GTS

• Syed Mir Mohsin Husain: A jeweller from Arcot who repaired critical instruments and was later appointed as an instrument maker in the Surveyor General's office.
• Radhanath Sikdar: An Indian mathematician recognized for calculating the height of Mount Everest, confirming it as the tallest peak in the world.
• Indian Field Workers: Thousands of Indian flagmen, khalasis, and laborers performed essential tasks, such as carrying heavy equipment and setting markers under challenging conditions.
• Logistical Support: Indian artisans and technicians played a vital role in repairing, calibrating, and adapting instruments to suit local conditions.
• Role of Pundits: Trained Indian "pundits" conducted secret surveys in politically sensitive regions like Tibet, where British officers were restricted.

The Great Trigonometric Survey stands as a monumental achievement in the history of scientific exploration in India, showcasing the collaborative efforts of both British officials and Indian assistants in shaping the geographical knowledge of the subcontinent.

GS3/Science and Technology

Breakthrough in Quantum Noise Research

Source: PIB

Why in News?

Researchers at the Raman Research Institute (RRI) have discovered that quantum noise, typically viewed as detrimental, can actually facilitate a special connection between particles known as entanglement. This finding holds significant implications for the development of future quantum technologies.

Key Takeaways

• Quantum noise can sometimes generate or restore entanglement, contrary to its usual perception as harmful.
• Intraparticle entanglement shows resilience to noise, making it valuable for quantum technologies.

Additional Details

• Quantum Noise: Refers to random disturbances impacting quantum systems, leading to loss of coherence (decoherence). Traditionally, it is seen as a hindrance to quantum entanglement, essential for quantum computing and communication.
• Entanglement Concept: This phenomenon occurs when particles are correlated in such a way that the state of one instantly influences the state of another, regardless of the distance separating them.
• Effect of Decoherence: Noise-induced decoherence disrupts entanglement, diminishing the efficiency of quantum technologies.
• Types of Noise Studied:
  • Amplitude Damping: Involves loss of energy.
  • Phase Damping: Pertains to the loss of phase information.
  • Depolarizing Noise: Characterized by random alterations in quantum states.
• Major observations indicate that under amplitude damping, intraparticle entanglement can experience delayed decay and even revival from unentangled states, unlike interparticle entanglement which shows steady decay without revival.
• Scientific Implications: This new perspective challenges the notion that quantum noise is purely detrimental, suggesting it can also be a resource in specific contexts.
• Technological Potential: The resilience of intraparticle entanglement to noise enhances its applicability in stable quantum devices, relevant for quantum communication, quantum key distribution (QKD), and quantum sensing.
• Predictive Advantage: A newly developed formula provides accurate predictions of entanglement behavior, assisting in the design of robust quantum systems.
• Platform Independence: The findings are applicable across various platforms, including photons, neutrons, and trapped ions.

This research marks a significant advancement in our understanding of quantum noise and its potential benefits, paving the way for more efficient quantum technologies.

GS3/Economy

Understanding India’s Corporate Investment Slowdown: Causes and Consequences

Source: The Hindu

Why in the News?

India is currently experiencing a significant slowdown in corporate investment, a situation that persists despite various policy initiatives. Recent data indicates that industrial growth has reached a nine-month low, while private sector capital formation remains sluggish, raising concerns about the overall economic recovery.

Key Takeaways

• India's industrial recovery is slow, with corporate investment not gaining momentum after the pandemic.
• The Index of Industrial Production (IIP) has shown a growth rate of just 1.2%, marking a nine-month low.
• Despite strong corporate profits, hesitant consumer demand is affecting investment decisions.

Additional Details

• Investment Dip: Investment is inherently linked to demand for goods and services. When demand is low, companies are reluctant to invest in expanding capacity.
• Corporate Sector Hesitancy: Even with robust profits, the Indian corporate sector is cautious about investment due to weak consumer demand, as highlighted in the 2024-25 Economic Survey.
• Investment Theories: Two main perspectives exist regarding investment behavior: one suggesting that investment can stimulate profits independently of demand, and another arguing that demand constrains investment. In a slow-growth environment, firms tend to make cautious investment decisions.
• Government Investment Limitations: The Indian government has attempted to stimulate private investment through tax cuts and infrastructure spending, but these measures face challenges such as long project gestation periods and limited job creation.
• Path to Recovery: A demand-led revival is essential for corporate investment to recover. This could involve increased government spending and initiatives aimed at boosting consumer demand.

In conclusion, India's corporate investment slowdown cannot be effectively addressed through tax cuts or interest rate adjustments alone. The central issue is weak consumer demand that deters firms from investing, even when profits are robust and credit is accessible. A sustained recovery will necessitate bold fiscal policies to stimulate demand, alongside structural reforms to enhance the business environment.