U.S. TARIFFS ON INDIAN IMPORTS
TOPIC: (GS3) ECONOMY: THE HINDU
Background of the Issue
- The U.S. imposed a 25% tariff on Indian imports on July 31, 2025.
- On August 6, an executive order added another 25% duty, making it a total 50% tariff.
- The first 25% tariff comes into effect immediately, while the second will begin after 21 days.
- The U.S. justifies the tariffs as a reaction to India buying oil from Russia, violating the intent of sanctions imposed during the Ukraine conflict.
India’s Response
- The Ministry of External Affairs (MEA) called the U.S. decision “unfair, unjustified, and unreasonable.”
- India stated that its energy imports are driven by national energy needs for 1.4 billion citizens.
- The MEA also noted the hypocrisy in U.S. and EU continuing trade with Russia in other sectors.
- India stressed that trade decisions are based on market trends and long-term energy security.
WHAT ARE TARIFFS?
Tariffs are taxes imposed by a government on goods that are imported (and sometimes exported). They are charged per product or as a percentage of the product’s value.
Tariffs are used to:
- Protect domestic industries
- Earn government revenue
- Regulate foreign trade
Types of Tariffs
- Import Tariffs – Tax on goods brought into the country.
- Export Tariffs – Tax on goods sent out of the country (rare in India).
- Ad-Valorem Tariff – A percentage of the value of the product.
- Specific Tariff – A fixed fee per unit (like ₹10 per kg).
How Tariffs Affect India’s Trade
Positive Effects
- Protects Indian industries from cheap foreign goods.
- Encourages Make in India and local production.
- Reduces trade dependence on some countries.
Negative Effects
- Raises prices of imported goods (bad for consumers).
- Can hurt Indian exporters if other countries also impose tariffs in return.
- Reduces global competitiveness of Indian goods if raw materials become costlier due to tariffs.
Impact on Trade and Economy
- The Federation of Indian Export Organisations (FIEO) called this move a “serious blow” to Indian exports.
- High tariffs can make Indian goods more expensive in the U.S., reducing their competitiveness.
- Ongoing negotiations on a Bilateral Trade Agreement (BTA) may face delays or tougher terms.
Conclusion
This sudden tariff hike is a fresh challenge for India-U.S. trade ties. While India defends its energy strategy, the decision reflects growing pressure on global alliances amid the Russia-Ukraine crisis.
RBI HOLDS REPO RATE & CUTS INFLATION FORECAST
TOPIC: (GS3) ECONOMY: THE HINDU
In its recent Monetary Policy Committee (MPC) meeting, the Reserve Bank of India kept the repo rate unchanged at 5.50%, while lowering its inflation forecast due to a sharp drop in consumer prices.
Why in News
- The RBI decided to pause rate cuts after CPI inflation dropped to 2.1% in June 2025, the lowest in six years.
- RBI also revised its inflation projection for FY26 to 3.1%, within its target band of 2%-6%.
What is the Repo Rate?
- Repo Rate: The rate at which RBI lends short-term money to banks.
- Acts as a key tool for managing inflation, liquidity, and economic growth.
- Lower repo rate makes borrowing cheaper, encouraging credit flow and spending.
About the Monetary Policy Committee (MPC)
- Established under the RBI Act, 1934, amended in 2016.
- A 6-member body: 3 members from RBI (Governor chairs it), 3 external experts appointed by the government.
- Decisions made by majority vote; RBI Governor has a casting vote in case of a tie.
Flexible Inflation Targeting Framework (FITF)
- Adopted in 2016 to maintain price stability while supporting growth.
- Current inflation target: 4% (±2%), set till March 2026.
- Focuses on Consumer Price Index (CPI) as the key indicator.
Why Did RBI Keep Rates Unchanged?
- Sharp decline in inflation, especially in vegetables and cereals.
- RBI had already cut the repo rate by 100 basis points in early 2025.
- RBI wants to assess the full effect of earlier rate cuts.
- Global risks: oil price volatility, US trade policies, geopolitical tensions.
Impact on the Economy
- Inflation: Lower prices improve consumer purchasing power.
- Borrowers: EMI and loan rates will stay steady, helping both new and existing borrowers.
- Growth: Stable rates and low inflation support steady economic growth.
- Works alongside the government’s spending on infrastructure and jobs.
Way Forward
- Monitor price trends, especially food and fuel, which can be volatile.
- Continue structural reforms in sectors like agriculture, logistics, and labour to keep inflation under control.
- RBI’s neutral policy stance gives it flexibility to respond to changing global or domestic economic conditions.
Conclusion:
by keeping rates unchanged, the RBI aims to balance inflation control with economic growth while staying ready to act if global or domestic risks arise.
BIOCHAR: A CLIMATE SOLUTION WITH UNTAPPED POTENTIAL
TOPIC: (GS3) ENVIRONMENT: THE HINDU
With India preparing to launch its carbon market by 2026, biochar is gaining attention as a low-cost, nature-based carbon removal solution. It has the potential to manage agricultural and urban waste, reduce emissions, and generate additional energy.
What is Biochar?
- Biochar is a carbon-rich solid material made from biomass like crop residue and organic waste through pyrolysis (burning in low-oxygen conditions).
- It serves multiple purposes: waste management, carbon sequestration, soil improvement, and energy generation.
India’s Waste Potential for Biochar Production
- India produces over: 600 million tonnes of crop residue. 60 million tonnes of municipal solid waste yearly.
- If 30-50% of this waste is converted into biochar, India could produce 15–26 million tonnes of biochar, removing 0.1 gigatonnes of CO₂-equivalent annually.
Byproducts and Energy Potential
- Biochar production yields syngas and bio-oil: Syngas (20–30 million tonnes) can produce 8–13 TWh of electricity, replacing 0.4–0.7 million tonnes of coal.
- Bio-oil (24–40 million tonnes) can replace 12–19 million tonnes of diesel or kerosene, cutting oil imports and reducing fossil fuel emissions by over 2%.
Sector-wise Benefits of Biochar
- Agriculture: Enhances soil fertility and water retention, especially in dry areas. Cuts nitrous oxide emissions by 30–50%, a gas far more harmful than CO₂. Reduces fertilizer need (by 10–20%) and improves crop yield (by 10–25%).
- Construction: Mixed in small amounts with concrete (2–5%), it: Increases strength and heat resistance. Locks 115 kg of CO₂ per m³, making buildings carbon sinks.
- Carbon Capture: Modified biochar can capture CO₂ from factory emissions, though current efficiency is lower than industrial technologies.
Wastewater Treatment
- A low-cost method to treat sewage and industrial water.
- 1 kg of biochar can treat 200–500 litres of water.
- India’s untreated wastewater can create a demand for 2.5–6.3 million tonnes of biochar.
Challenges to Adoption
- Lack of standardisation in raw materials and carbon accounting systems.
- Weak policy support and insufficient investment models.
- Poor awareness and coordination across sectors like energy, agriculture, and environment.
- Weak monitoring, reporting, and verification (MRV) systems.
Way Forward for Large-scale Adoption
- Promote R&D for region-specific feedstock and usage guidelines.
- Integrate biochar into: Crop residue schemes, bioenergy plans, and state climate strategies.
- Recognise biochar under the Indian carbon market to allow carbon credit trading.
- Support village-level production units, which can generate over 5 lakh rural jobs.
Conclusion
Biochar is a multi-benefit solution for India’s environmental, energy, and rural development goals. Though not a single solution to climate change, it offers a practical, science-backed tool that needs stronger institutional and market support.
CHINA’S ECONOMIC STRATEGY AND ITS LESSONS FOR INDIA
TOPIC: (GS2) INTERNATIONAL RELATIONS: THE HINDU
A large number of Chinese engineers recently left key iPhone manufacturing sites in India, raising concerns about China’s subtle attempts to slow India’s rise in electronics manufacturing. This comes at a time when the U.S. has raised tariffs on Indian goods, even as China faces fewer trade restrictions.
China’s Withdrawal of Engineers: A Strategic Move
- Over 300 Chinese technicians left Foxconn’s iPhone production plants in Tamil Nadu and Karnataka.
- These engineers were key to setting up and running high-tech manufacturing lines.
- Their departure seems designed to limit India’s access to advanced manufacturing skills and know-how.
- This indirectly delays India’s efforts to grow in the electronics sector.
Use of Economic Tools to Curb India’s Growth
- China has restricted exports of critical materials like gallium, graphite, and rare earths to India.
- Informal barriers, such as verbal orders and delays, are being used to block shipments of key manufacturing equipment.
- These tools increase production costs and slow down supply chains in India.
China’s Motive: Protecting Its Economic Dominance
- China views India’s growing manufacturing ambitions as a threat to its own leadership in exports.
- Maintaining high export earnings is crucial for China due to: An aging population. A weak domestic market. Rising welfare and pension costs.
- Hence, it tries to prevent competitors from catching up.
India’s Challenges in Manufacturing
- India still depends heavily on imports for electronics, semiconductors, machinery, and raw materials.
- The domestic manufacturing ecosystem is still growing and lacks strong infrastructure.
- Bureaucratic delays and policy gaps further affect industrial growth.
- The “Make in India” vision needs global help and local reforms to succeed.
Double Standards in Global Trade
- The U.S. imposed a 50% tariff on Indian goods, even though China, which imports more Russian oil, got a 90-day exemption from tariffs.
- This highlights the fragile nature of global partnerships and emphasizes the need for India to become strategically self-reliant.
Conclusion
China is using trade tools, critical resources, and human expertise to slow India’s manufacturing progress. India must learn from this, reduce its import dependence, and strengthen its foundation to truly compete globally.
MODERNISATION OF INDIA’S MARITIME LAWS
TOPIC: (GS2) INDIAN POLITY: THE HINDU
Parliament has passed two important maritime legislations — the Merchant Shipping Bill, 2024 and the Carriage of Goods by Sea Bill, 2025 — aiming to upgrade India’s shipping laws and align them with global maritime standards.
Background and Context
- India’s previous maritime laws were decades old, such as:
- Merchant Shipping Act, 1958
- Carriage of Goods by Sea Act, 1925
- These laws were outdated and needed reforms to suit modern shipping practices and international conventions.
Key Features of the New Bills
Merchant Shipping Bill, 2024
- Replaces the Merchant Shipping Act, 1958.
- Described as future-ready and progressive.
Aims to:
- Promote ease of doing business in shipping.
- Attract global maritime trade and investment.
- Improve India’s status as a reliable shipping hub.
Carriage of Goods by Sea Bill, 2025
- Repeals the Indian Carriage of Goods by Sea Act, 1925.
- Focuses on: Simplifying laws for cargo transport by sea. Reducing legal disputes and uncertainties in shipping. Enhancing transparency and efficiency in maritime logistics.
- Brings Indian law in line with international standards such as: Hague-Visby Rules, Hamburg Rules
Significance of the Legislation
- Strengthens India’s maritime legal framework.
- Supports the government’s vision for a modern and efficient shipping sector.
- Encourages cleaner trade practices and boosts global investor confidence.
- Reduces the risk of legal conflicts in cargo handling and maritime commerce
Conclusion
These maritime laws mark a major reform in India’s shipping sector, supporting global integration and improving legal clarity in sea trade operations.
JUDICIAL OVERREACH AND FREE SPEECH CONCERNS
TOPIC: (GS2) INDIAN POLITY: THE HINDU
The Supreme Court made controversial oral remarks against Congress leader Rahul Gandhi during a hearing on a defamation case related to his comments on the Galwan clash. These remarks have sparked a debate on judicial overreach and the right to political dissent.
Background of the Issue
- Rahul Gandhi had questioned the Indian government’s stance on the 2020 Galwan Valley clash with China.
- He made statements suggesting loss of Indian territory and government inaction.
- A defamation case was filed against him for these remarks.
Supreme Court’s Remarks
- A bench led by Justice Dipankar Datta made an oral observation that a “true Indian” wouldn’t say what Mr. Gandhi did.
- This comment raised concern as it appeared to judge patriotism instead of focusing on legal arguments.
- The Court’s role is to interpret the Constitution and laws, not to define national loyalty.
Judicial Overreach
- It means the judiciary (courts) interfering too much in the work of the executive (government) or legislature (Parliament).
- Courts should interpret laws, not make or enforce them.
- When they go beyond their role, it is called judicial overreach.
- Example: If a court orders how a government scheme should be run step-by-step, it may be overstepping its role.
Free Speech
- It is the right to express one’s opinions freely without fear, as guaranteed under Article 19(1)(a) of the Indian Constitution.
- It includes speaking, writing, and sharing views publicly.
- Limits: Free speech is not absolute. It can be restricted in the interest of:
- National security
- Public order
- Decency or morality
- Contempt of court
- Defamation
Concerns of Judicial Overreach
- Such statements from the judiciary can discourage political criticism.
- Criticism of the government, especially by Opposition leaders, is a key part of democracy.
- Free speech is a constitutional right, especially in political debate.
- By implying that certain opinions are “un-Indian,” the Court risks weakening public dissent.
Credibility of Rahul Gandhi’s Statements
- Gandhi’s remarks are supported by: Open-source satellite data showing Chinese activity at the LAC. Parliamentary reports acknowledging loss of patrolling rights in areas like Depsang and Galwan.
- Statements by military experts and locals pointing to restricted access to grazing lands.
- The estimate of around 2,000 sq km of lost access has been cited by defence analysts.
Way Forward
- The judiciary should stay neutral and avoid making personal or moral judgments.
- Its primary responsibility is to uphold constitutional values and safeguard free speech.
- A strong democracy depends on independent courts, free media, and open criticism of power.
Conclusion
By focusing only on law and protecting dissent, the Supreme Court can uphold its legitimacy and support India’s democratic framework.
AADHAAR FACE AUTHENTICATION IN EXAMS
TOPIC: (GS2) GOVERNANCE: THE HINDU
The Ministry of Electronics and IT stated that using Aadhaar’s facial recognition can build trust among aspirants and reduce malpractices in recruitment exams. SSC (Staff Selection Commission) and RRB (Railway Recruitment Board) are already using this method to verify examinees.
What is Aadhaar Face Authentication?
- It matches a person’s face with their original Aadhaar photo using phone cameras.
- Includes a “liveness” check to ensure the face is real-time and not a photograph or video.
- Useful where fingerprints are worn out or difficult to read (e.g., elderly, labourers).
Recent Developments
- EPFO now requires facial verification to generate Universal Account Numbers (UANs).
- India Post Payments Bank has also adopted facial authentication, supporting Digital India and financial inclusion goals.
- UIDAI is promoting face and iris scans for residents who face issues with fingerprint authentication.
Regulatory Framework
- Aadhaar authentication (including face ID) needs approval from the IT Ministry.
- As per SWIK Rules, 2025, proposals can be submitted via the SWIK Portal.
- Over 312 government bodies have received approval since 2020.
Use Cases Beyond Exams
- Recently, Sports Authority of India was allowed to use Aadhaar verification for athletes, coaches, and DBT schemes like Khelo India and TOPS.
STATUS OF AADHAAR IN INDIA – AS PER SUPREME COURT JUDGMENTS
Constitutionally Valid (2018 Judgment)
- In the landmark K.S. Puttaswamy (Aadhaar) case (2018), the Supreme Court upheld the constitutional validity of Aadhaar.
- It ruled that Aadhaar does not violate the right to privacy when used reasonably and for legitimate purposes.
Mandatory Only for Welfare Schemes
- Aadhaar can be made mandatory for availing government subsidies and welfare schemes, like LPG subsidy, PDS, MNREGA, etc.
- This helps ensure that the benefits go only to genuine beneficiaries.
Not Mandatory for Private Services
- Private companies (like banks, telecom operators) cannot force people to link Aadhaar for services.
- This means no compulsion to link Aadhaar with mobile numbers or bank accounts.
Voluntary for PAN and ITR
- Linking Aadhaar with PAN and for filing Income Tax Returns (ITR) is allowed and currently mandatory under law.
- This is upheld by the Court to prevent tax fraud and duplication of PANs.
Children’s Aadhaar Use Restricted
- Aadhaar is not mandatory for school admissions or exams.
- Children can’t be denied benefits for lack of Aadhaar but can be enrolled voluntarily.
Data Protection Emphasized
- The Court directed the government to strengthen data security and prevent misuse of Aadhaar information.
- UIDAI must ensure robust protection of biometric and personal data.
Conclusion
Facial recognition under Aadhaar is emerging as a secure, inclusive, and transparent tool for identity verification in various public services, especially exams.
UTTARKASHI FLOOD DISASTER AND THE HIDDEN THREATS IN THE HIMALAYAS
TOPIC: (GS3) DISASTER MANAGEMENT: THE HINDU
people and massive destruction. This highlights the increasing vulnerability of Himalayan regions to extreme weather events and the urgent need for better monitoring.
What Happened in Uttarkashi
- A devastating flood hit Dharali town near the Kheer Ganga River in Uttarkashi district.
- Caused by intense rainfall between August 3–5, with up to 30 cm in one day.
- Water mixed with debris, soil, and silt destroyed homes and buildings.
- At least four deaths confirmed and over 60 people feared missing, including Army personnel.
- Videos showed powerful waves rushing through the area.
Cloudburst or Continuous Rainfall?
- State officials termed the event a ‘cloudburst’, though actual cloudbursts have a specific definition (10 cm rainfall in one hour over 10 sq. km).
- Due to the lack of high-altitude weather radars, IMD cannot confirm cloudbursts accurately in such regions.
- It is likely that steady rainfall over 48 hours loosened soil and triggered the flood.
What is a Cloudburst?
- Cloudburst is a sudden and very heavy rainfall in a short time over a small area.
- It usually happens in mountainous regions like the Himalayas.
- It occurs when rain-bearing clouds release water all at once, like a bucket being emptied.
- Rainfall can be more than 100 mm in one hour — too much for the soil and drains to absorb.
- This causes flash floods, landslides, and destruction of property and life.
Why Does It Happen?
- When warm, moist air rises quickly and cools suddenly, clouds form and rain falls heavily.
- In hilly areas, clouds get trapped by mountains, increasing the chances of sudden downpours.
Effects of Cloudburst
- Flash floods
- Landslides
- Washed-away roads, bridges, and houses
- Loss of lives and livestock
Recurring Risk in the Himalayas
- These incidents are not rare; they are increasing due to climate change.
- Rising extreme rainfall events in hill regions raise the risk of sudden disasters.
- Unregulated construction, infrastructure projects, and hill cutting leave behind debris and silt that worsen floods and landslides.
Challenges in Disaster Response
- Calling it a ‘freak’ event allows authorities to avoid responsibility.
- Most responses include social media sympathy and token compensation.
- There’s a lack of proactive planning, especially in terms of early warning and risk mitigation.
What Should Be Done
- Post-relief, state governments must assess silt and debris accumulation at high-risk zones.
- Regular monitoring of sensitive locations in hilly areas is needed.
- Integrate climate adaptation into all new infrastructure projects in the Himalayas.
Conclusion
Disasters like in Uttarkashi are not one-off events. Climate change and poor planning make the Himalayas more fragile, and governments must act to prevent future tragedies.
INDRI LEMUR
TOPIC: (GS3) ENVIRONMENT: THE HINDU
Why in News?
Recent joint research has successfully identified the gut microbiome composition of the Indri Lemur, offering insights into its diet and health. This is crucial for the conservation of this critically endangered species.
About Indri Lemur
- Scientific Name: Indri indri
- Locally called Babakoto, it is the largest living lemur species.
- Endemic to Madagascar, specifically the northeastern rainforests.
Habitat and Features
- Lives in coastal and montane rainforests from sea level up to 1800 m.
- Grows up to 60–70 cm in body length, with a rudimentary tail.
- Has a rounded head, large furry ears, and long limbs for tree climbing.
- Fur is typically black with white patches—pattern varies by region.
- Completely arboreal and diurnal, feeding mainly on leaves, fruits, and flowers.
Conservation Status and Threats
- Listed as Critically Endangered on the IUCN Red List.
- Faces habitat loss due to deforestation, slash-and-burn agriculture, and illegal hunting.
- Fragmented population makes recovery difficult.