1. PM Jan Dhan Yojana Completes a Decade of Financial Inclusion
- Context: On August 28, 2024, the Pradhan Mantri Jan Dhan Yojana (PMJDY) completed 10 years, a landmark moment in India’s journey toward financial inclusion. Launched in 2014, the scheme has been the cornerstone of the government’s strategy to provide universal access to banking facilities. A press release from the Ministry of Finance and statements from senior government officials highlighted its success and outlined future goals, including a target to open an additional 3 crore new accounts in the current financial year.
- Key Aspects of the Scheme:
- Universal Banking: The core objective of PMJDY was to ensure that every household in the country had at least one bank account.
- Zero-Balance Accounts: Accounts could be opened with no minimum balance requirement, eliminating a major barrier for the poor to access banking services.
- Rupay Debit Cards: Every account holder was provided with a RuPay debit card, which came with an inbuilt accident insurance cover.
- Overdraft Facility: The scheme also included a small overdraft facility of up to ₹10,000 for eligible account holders, aimed at providing access to micro-credit.
- Direct Benefit Transfer (DBT) Enabler: PMJDY accounts serve as the primary channel for the government’s DBT system, ensuring that subsidies and welfare payments reach beneficiaries directly and transparently.
- Achievements and Impact:
- Massive Account Opening: As of mid-August 2024, over 53 crore bank accounts had been opened under PMJDY, a remarkable achievement in such a short span.
- Reduction in Urban-Rural Divide: A significant majority, approximately 67%, of the new accounts were opened in rural and semi-urban areas, successfully bridging the gap in banking access.
- Gender Empowerment: With about 56% of the accounts held by women, PMJDY has played a crucial role in empowering women by giving them financial independence and control over their own money.
- Reduction in Inoperative Accounts: The average deposit per account has steadily increased over the years, indicating a shift from merely having an account to actively using it for savings and transactions.
- JAM Trinity: The scheme, along with Aadhaar and Mobile phones, formed the “JAM” trinity, which has been instrumental in the digital payments revolution in India and in streamlining the delivery of government services.
- Economic Impact: The total deposit balance in PMJDY accounts now stands at over ₹2.3 lakh crore, reflecting the mobilization of informal savings into the formal financial system. The scheme has also boosted the usage of digital payments, with a huge jump in UPI and RuPay card transactions.
- Challenges and the Way Forward:
- Zero-Balance Accounts: Despite overall growth in deposits, a notable percentage of accounts still remain with zero balance, indicating that a significant portion of the population is yet to fully engage with the financial system.
- Financial Literacy: A major challenge is the lack of financial literacy, particularly in rural and remote areas. People may have an account, but they may not be fully aware of how to use it for savings, credit, or insurance.
- Inoperative Accounts: The issue of inoperative or dormant accounts needs to be addressed to ensure that the infrastructure created is actively utilized.
- Expanding Services: The next phase of the scheme should focus on moving beyond basic accounts to providing a wider range of tailored financial products, such as micro-credit, micro-insurance, and pensions, to low-income households.
- Conclusion: The completion of 10 years of PMJDY is a testament to India’s commitment to inclusive growth. The scheme has successfully laid the foundation for a robust and transparent financial ecosystem, bringing millions into the mainstream economy and fundamentally changing the way government benefits are delivered. The future success of the mission will depend on addressing the remaining challenges to ensure that every bank account becomes a tool for genuine financial empowerment.
- Practice Mains Question: “The Pradhan Mantri Jan Dhan Yojana has been a transformative tool for financial inclusion in India. Analyze its achievements over the past decade and discuss the challenges that must be addressed to ensure the scheme’s continued success and evolution.”
2. India and US Finalize Security of Supplies Arrangement (SOSA)
- Context: On August 28, 2024, India and the United States finalized a landmark Security of Supplies Arrangement (SOSA) and a Memorandum of Agreement on Liaison Officers. These agreements were a major outcome of ongoing high-level discussions between the two nations’ defense ministries. The SOSA is a non-binding but crucial pact designed to ensure that both countries can quickly access critical defense goods and services, particularly during emergencies or disruptions in the global supply chain.
- Key Features of SOSA:
- Priority Support: The arrangement commits both India and the US to provide priority support for defense-related goods and services to each other, a step towards a more integrated and reliable defense supply chain.
- Reciprocal Commitment: It is a reciprocal agreement, meaning both nations agree to a “Code of Conduct” for their defense industries to prioritize each other’s needs.
- Industrial Cooperation: This arrangement is meant to further the goals of the U.S.-India Defense Technology and Trade Initiative (DTTI), which focuses on co-development and co-production of defense technologies.
- Liaison Officers: The separate agreement on liaison officers will facilitate greater communication and operational coordination between the two militaries by embedding officers in key commands.
- Strategic and Economic Implications:
- Deepening Partnership: The SOSA solidifies India’s status as a “Major Defense Partner” of the US. This moves the relationship from a simple buyer-seller dynamic to one of deeper strategic collaboration and mutual trust.
- Supply Chain Resilience: In an era of increasing geopolitical tensions and supply chain vulnerabilities, the arrangement provides a much-needed layer of security for both countries’ defense industries.
- “Make in India” Boost: By facilitating closer ties between Indian and US defense firms, the agreement can attract foreign investment, promote technology transfer, and boost India’s indigenous defense manufacturing capabilities. Indian private companies may get better access to the US defense market.
- Countering China: The agreement is a clear signal of the two nations’ commitment to strengthening their defense capabilities in the Indo-Pacific region, a direct response to China’s growing military and economic assertiveness.
- Global Positioning: By joining a select group of countries with which the US has a SOSA, India enhances its standing as a key player in the global defense landscape.
- Challenges and Considerations:
- Strategic Autonomy: India has historically maintained strategic autonomy in its foreign policy and defense procurement, balancing its relationships with countries like Russia, France, and Israel. The deepening of ties with the US could test this principle.
- Export Control: While the agreement provides assurances, it is still subject to the US’s export control laws, which could create limitations on what technology and equipment are shared.
- Implementation Hurdles: The success of the SOSA will depend on its effective implementation and how well it is able to overcome bureaucratic hurdles and differences in legal and regulatory frameworks.
- Conclusion: The finalization of the SOSA is a pivotal moment in India-US defense relations. It provides a robust framework for ensuring a stable and secure defense supply chain, which is critical for India’s national security interests. While the agreement opens up significant opportunities for technological cooperation and industrial growth, India must carefully navigate its implementation to ensure it aligns with its long-term strategic and geopolitical goals.
- Practice Mains Question: “Examine the significance of the Security of Supplies Arrangement (SOSA) between India and the United States. How does this agreement contribute to India’s strategic defense objectives and what are the potential challenges in its implementation?”
3. Government Announces Five New Districts in Ladakh
- Context: In a major administrative and governance reform, the Ministry of Home Affairs (MHA) announced on August 28, 2024, the creation of five new districts in the Union Territory of Ladakh. The new districts are Zanskar, Drass, Sham, Nubra, and Changthang. This decision increases the number of districts from two (Leh and Kargil) to seven. The move has been widely welcomed by local residents who have long demanded administrative decentralization to address the unique challenges posed by the region’s vast and difficult terrain.
- Key Drivers for the Decision:
- Administrative Efficiency: With only two districts, the administration struggled to provide services to remote and far-flung areas. The new districts will bring government offices and services closer to the people, making governance more accessible.
- Socio-Economic Development: The creation of new administrative units will allow for more targeted and focused development planning. Each new district will have its own administration and resources, which can be tailored to the specific needs of the local population.
- Geopolitical Significance: The new districts, particularly those like Nubra and Changthang, are strategically located near the Line of Actual Control (LAC) with China. The improved administrative presence and infrastructure development will bolster national security in these sensitive border regions.
- Devolution of Power: The move addresses long-standing demands from local communities for greater representation and autonomy. The new districts will give a stronger voice to the people of regions like Zanskar and Drass, who often felt marginalized under the old two-district structure.
- Expected Benefits:
- Improved Service Delivery: Residents of remote areas will no longer have to travel long distances for administrative work, saving them time and resources.
- Boost to Local Economy: The creation of new administrative centers will lead to infrastructure development, which will in turn create local job opportunities and boost economic activities in the region.
- Effective Implementation of Schemes: Central and UT-level welfare schemes will be implemented more efficiently, ensuring that benefits reach the last person in the society.
- Strengthened Security: The increased administrative presence and development in border areas will enhance security and help the local population feel more integrated with the rest of the country.
- Challenges and Way Forward:
- Infrastructure and Personnel: The government must ensure that the new districts are equipped with adequate funding, administrative infrastructure, and trained personnel from the very beginning to avoid administrative bottlenecks.
- Consultation with Local Bodies: The Ladakh administration has been tasked with forming a committee to work out the details. Extensive consultation with the Ladakh Autonomous Hill Development Councils and local leaders is essential to ensure a smooth transition.
- Addressing Political Demands: While the creation of new districts is a significant step, it does not fully address the broader political demands of the region for statehood and inclusion in the Sixth Schedule of the Constitution. The government must continue to engage with local bodies to find a long-term solution.
- Ecological Concerns: Any new development in the ecologically fragile Ladakh region must be carried out with great care to prevent environmental damage.
- Conclusion: The creation of five new districts in Ladakh is a bold and strategic decision that promises to bring better governance and more equitable development to the region. It is a testament to the government’s commitment to empowering local communities and strengthening India’s presence in a critical border area. If implemented effectively and with a focus on local needs, this move has the potential to transform the social, economic, and administrative landscape of Ladakh for decades to come.
- Practice Mains Question: “The creation of five new districts in Ladakh is a step towards administrative decentralization. Analyze the reasons behind this decision and discuss its potential impact on governance, development, and the region’s geopolitical significance.”
4. India and the US Partner on Semiconductor Manufacturing
- Context: A significant development in India’s strategic push for a robust semiconductor ecosystem occurred on August 28, 2024. The U.S. government announced a major investment and technical assistance package to support an upcoming semiconductor fabrication plant in India. This move is part of the US-India Initiative on Critical and Emerging Technology (iCET) and is seen as a key step in building a resilient global semiconductor supply chain, reducing dependency on a handful of nations, particularly in East Asia. The announcement was made jointly by officials from the U.S. Department of Commerce and India’s Ministry of Electronics and Information Technology (MeitY) during a virtual summit.
- Detailed Analysis:
- Strategic Importance: The semiconductor industry is the bedrock of modern technology, powering everything from smartphones and computers to military equipment and electric vehicles. The global supply chain for semiconductors is highly concentrated, with a few countries dominating production. This concentration creates a significant geopolitical vulnerability. The U.S.’s support for India’s semiconductor ambitions is a strategic move to diversify this supply chain and reduce its own dependence on regions like Taiwan. For India, it is a crucial step toward achieving self-reliance in a critical technology sector and becoming a key player in the global electronics manufacturing value chain.
- “Make in India” & Atmanirbharta: This partnership is a major boost to India’s “Make in India” and “Atmanirbhar Bharat” initiatives. Building a semiconductor fab is an extremely capital-intensive and technologically complex endeavor. The U.S. support, which includes financial incentives and technology transfer, is a game-changer. It will not only bring in foreign direct investment but also provide access to the high-end technology and expertise required to operate a fabrication unit. This will create a ripple effect, encouraging ancillary industries and fostering an entire ecosystem around semiconductor manufacturing.
- Economic Impact: The direct economic impact of this project will be substantial. A semiconductor fab can create thousands of high-skilled jobs in engineering, research, and manufacturing. Furthermore, it will attract global chip design and manufacturing companies to India, transforming the country into a hub for electronics production. The move will also reduce India’s import bill for semiconductors, which is currently a major drain on its foreign exchange reserves.
- Challenges and Way Forward: While the announcement is a positive development, several challenges remain. The project will require a stable supply of clean water and electricity, as well as a large pool of skilled labor, which India needs to rapidly develop. Moreover, the project’s success will depend on a clear and consistent policy environment, free from bureaucratic hurdles. The government must also focus on creating a robust intellectual property rights (IPR) regime to protect the technology being transferred.
- Geopolitical Implications: The partnership signals a deepening of the U.S.-India strategic relationship, which is increasingly defined by technological and economic cooperation. It is a clear message to China, which is also heavily investing in its semiconductor industry, that the US is committed to building a new, more diversified supply chain. This move positions India as a trusted partner in the global technology race.
- Practice Mains Question: “Analyze the strategic and economic significance of the U.S.-India partnership on semiconductor manufacturing. Discuss the potential benefits and challenges for India in becoming a global hub for semiconductor production.”
5. SEBI Unveils New Framework for ESG Rating Providers
- Context: On August 28, 2024, the Securities and Exchange Board of India (SEBI) introduced a new regulatory framework for Environmental, Social, and Governance (ESG) rating providers. The new rules are aimed at bringing transparency, accountability, and consistency to the nascent but rapidly growing ESG rating market in India. The move comes as an increasing number of Indian and foreign investors are using ESG ratings to make investment decisions, and SEBI seeks to prevent greenwashing and ensure the integrity of the market.
- Detailed Analysis:
- Need for Regulation: The global ESG market has grown exponentially, and India is no exception. However, a lack of standardized ratings and methodology has been a major concern. Different rating agencies use different criteria, which can lead to conflicting ratings for the same company. This has created confusion for investors and has been a fertile ground for “greenwashing,” where companies make unsubstantiated claims about their environmental and social credentials. SEBI’s new framework addresses this by mandating standardized disclosure, methodology, and a code of conduct for all ESG rating providers.
- Key Provisions of the Framework: The new framework mandates that all ESG rating providers must be registered with SEBI. They must also disclose their methodologies, data sources, and any potential conflicts of interest. The ratings must be based on a transparent and verifiable process. Furthermore, the framework introduces an independent third-party audit mechanism to ensure the integrity of the ratings.
- Impact on Corporate Governance: The new rules will have a significant impact on corporate governance in India. Companies will be under greater pressure to improve their environmental and social performance to secure a favorable ESG rating. This will encourage more sustainable business practices, better labor standards, and a stronger focus on corporate social responsibility. It will also empower shareholders to hold companies accountable for their non-financial performance.
- Investor Confidence: The new framework will boost investor confidence in India’s ESG market. By providing a clear and transparent rating system, SEBI is ensuring that investors have reliable information to make informed decisions. This will likely attract more domestic and foreign capital into companies with strong ESG credentials, thereby promoting sustainable finance.
- Global Alignment: The move by SEBI aligns India with global trends in sustainable finance. Major regulators in the US and Europe are also introducing stricter rules for ESG ratings. By adopting a similar framework, India is positioning itself as a leader in the global sustainable finance movement and making its market more attractive to international investors who prioritize ESG factors.
- Practice Mains Question: “Discuss the significance of SEBI’s new regulatory framework for ESG rating providers in India. How will this framework address the issue of ‘greenwashing’ and what impact will it have on corporate governance and investor confidence?”
6.India-Africa Trade Crosses $100 Billion, New Delhi Emerges as a Top Investor
- Context: A significant milestone was announced on August 28, 2025, during the CII India-Africa Business Conclave in New Delhi. Union Minister Kirti Vardhan Singh revealed that India’s bilateral trade with Africa has surpassed the $100 billion mark in the fiscal year 2024-25, a substantial increase from $56 billion in 2019-20. The minister also highlighted that India has emerged as one of the top five largest investors in the continent, with cumulative investments exceeding $75 billion since 1996. The event, themed “Co-creating a Shared Future,” underscored a shift from a traditional project-based partnership to a more collaborative and equitable relationship.
- Detailed Analysis:
- Economic Diplomacy and South-South Cooperation: This trade milestone is a testament to India’s proactive and robust economic diplomacy with Africa. Unlike many developed nations, India’s engagement is based on the principle of South-South cooperation, focusing on shared development goals and mutual benefit. The concessional loans and grant assistance provided by India for various African projects, along with thousands of scholarships for African youth, reflect a partnership model that prioritizes capacity building and human resource development, rather than a purely commercial approach. This approach resonates with African nations and differentiates India from other global players.
- Diversification and Resilience: The growth in India-Africa trade is crucial in the current global economic climate, which is marked by protectionism and geopolitical tensions. As some of India’s traditional export markets, like the US, impose higher tariffs, the African market provides a vital alternative for diversification. This ensures that India’s export industries, including textiles, pharmaceuticals, and agricultural products, have new avenues for growth. The rising trade figures demonstrate the resilience of India’s economy and its ability to adapt to a changing global trade environment.
- Strategic Importance: Africa is of immense strategic importance to India. It is a continent with a young and rapidly growing population, vast natural resources, and immense potential for infrastructure development. India’s engagement is not just about trade; it is about building long-term strategic alliances. The fact that the African Union was granted permanent membership in the G20 during India’s presidency further cements this relationship, giving Africa a stronger voice on the global stage and strengthening India’s position as a champion of the Global South.
- Future Outlook and Challenges: While the numbers are encouraging, there are still challenges to overcome. The trade basket remains skewed, with India primarily importing raw materials and energy resources from Africa and exporting finished goods. There is a need for greater value addition in Africa and a more diversified trade portfolio. Furthermore, issues such as political instability in some African countries, lack of adequate infrastructure, and logistical challenges can hinder trade and investment. To address this, India must continue to invest in key infrastructure projects, provide lines of credit for small and medium enterprises, and promote greater people-to-people contact.
- Conclusion: The burgeoning trade relationship between India and Africa is a major success story of India’s foreign policy. It is a win-win partnership built on mutual trust and shared aspirations. The milestone of crossing $100 billion in bilateral trade is a clear indicator of the immense potential that lies ahead. As India continues to strengthen its economic and strategic ties with Africa, it not only contributes to the continent’s development but also reinforces its own standing as a responsible and influential global power.
- Practice Mains Question: “Analyze the key drivers behind the recent surge in India-Africa trade and investment. In what ways does this partnership serve India’s strategic and economic interests, and what are the challenges that need to be addressed to ensure its sustainability?”
7.Union Agriculture Minister Addresses Research Workers’ Workshop
- Context: Union Agriculture and Farmers’ Welfare Minister Shri Shivraj Singh Chouhan addressed the 64th All India Wheat and Barley Research Workers’ Workshop in Gwalior on August 28, 2025. In his address, the minister underscored the importance of reducing farming costs to make agriculture more profitable for small and marginal farmers. He urged agricultural scientists to focus their research on developing bio-fortified crop varieties, managing stubble, and promoting integrated farming models. The minister’s remarks come at a time when the government is grappling with the dual challenge of ensuring food security and raising farmers’ income.
- Detailed Analysis:
- Profitability of Agriculture: The minister’s focus on reducing agricultural costs is a critical policy direction. While India has achieved self-sufficiency in key food grains like wheat and rice, farming remains a high-risk and low-profit occupation for many. The high cost of inputs, such as fertilizers and pesticides, coupled with volatile market prices, often traps farmers in a cycle of debt. The government’s push for “Lab to Land” initiatives aims to ensure that scientific research and technological innovations directly benefit farmers, helping them cut costs and increase productivity.
- Sustainable Farming Practices: The minister’s emphasis on bio-fortified crops and soil health addresses major environmental and health concerns. Bio-fortified crops, which are rich in essential nutrients, are crucial for combating malnutrition. The call to prevent the harmful impact of imbalanced fertilizer use on soil quality is a direct response to the issue of soil degradation and water pollution. This aligns with a broader national strategy to promote sustainable and regenerative agriculture.
- Integrated Farming: The push for integrated farming is particularly relevant for small and marginal farmers, who constitute the vast majority of India’s agricultural workforce. Integrated farming, which combines agriculture with allied activities like animal husbandry, beekeeping, and fisheries, provides a diversified source of income and reduces the risk associated with relying on a single crop. This model also promotes better resource utilization and helps farmers become more resilient to climate-related shocks.
- Technological Adoption and Farmer Awareness: A key challenge in Indian agriculture is the low adoption rate of modern technologies. The minister’s call for scientists to educate farmers and for the government to take strict action against counterfeit products highlights the need for a multi-pronged approach. The government is promoting the use of drones and other technologies, but these efforts must be accompanied by robust extension services and farmer education programs to be truly effective.
- Policy Alignment: The minister’s address reflects a clear alignment with the government’s broader policy goals of promoting self-reliance, ensuring food security, and empowering farmers. The appeal to use indigenous products also ties into the “Swadeshi” and “Make in India” campaigns, which are gaining renewed traction in the wake of global trade disputes.
- Conclusion: Shri Shivraj Singh Chouhan’s address at the research workshop was more than just a ceremonial speech; it was a clear articulation of India’s new agricultural policy priorities. The focus is shifting from simply increasing production to ensuring the long-term sustainability and profitability of farming. By combining scientific research with practical, on-the-ground interventions and a strong policy framework, India aims to create a more resilient and prosperous agricultural sector that can meet the challenges of the future.
- Practice Mains Question: “Discuss the key priorities of India’s new agricultural policy as highlighted by the Union Agriculture Minister. How do these priorities aim to address the twin challenges of farmer profitability and agricultural sustainability in India?”
