The Cabinet Committee on Economic Affairs has approved the SARTHAK Public Distribution System (PDS) scheme, a five-year initiative costing ₹25,530 crore, aimed at enhancing food security across India. The scheme will integrate advanced technologies into PDS operations, covering everything from beneficiary selection to foodgrain movement and proactive citizen feedback. It also seeks to reduce transportation distances for foodgrains. This comprehensive approach is expected to streamline the PDS, making it more efficient and responsive to the needs of the beneficiaries.
- The SARTHAK PDS scheme has been approved to improve food security in India.
- It is a five-year scheme with a significant financial outlay.
- The scheme will leverage advanced technologies for efficient PDS operations.
India's out-of-pocket expenditure (OOPE) as a share of total health expenditure has significantly declined to 43.4% in 2022-23, from 64.2% in 2013-14. This decline is attributed to increased government health expenditure, particularly through the operationalization of Ayushman Arogya Mandir wellness centres, which provide free preventive and curative services. The report, based on National Health Accounts (NHA) estimates, also indicates an increase in government health expenditure as a percentage of GDP (from 1.15% to 1.43%) and general government expenditure (from 3.78% to 4.89%). The share of private health insurance has also risen, indicating improved health-seeking behavior.
- Out-of-pocket expenditure (OOPE) on health in India has decreased significantly.
- This reduction is linked to increased government health spending and the expansion of Ayushman Arogya Mandir wellness centres.
- Government health expenditure as a percentage of GDP and general government expenditure has risen.
The article critiques Prime Minister Narendra Modi's appeals for citizen restraint and self-reliance during global crises, arguing that such calls subtly shift the burden of structural problems from the state to individuals. It emphasizes that national resilience requires strong institutions, sustained public investment, and robust governance, rather than merely behavioral appeals. The author advocates for governments to invest in social protection, address economic inequality, prioritize long-term investments in education and research, strengthen transparency, and protect democratic dialogue. The piece highlights that while individual responsibility matters, it cannot substitute for fundamental institutional reforms to address systemic vulnerabilities.
- The article argues against over-reliance on citizen sacrifice during crises, advocating for stronger institutional responses.
- Governments should invest in social protection, education, and research, and address economic inequality.
- Transparency, public trust, and protection of democratic dialogue are crucial for national resilience.
The European Union's Carbon Border Adjustment Mechanism (CBAM), effective from January 1, 2026, aims to prevent carbon leakage by imposing a carbon-linked charge on imports based on embedded emissions. This policy will significantly impact carbon-intensive Indian exports like steel, cement, and aluminium, making them costlier. CBAM also poses indirect price pressures on India's fertilizer imports, as key exporters to the EU are also major suppliers to India, potentially increasing global fertilizer prices and jeopardizing India's agricultural sector. India needs a two-pronged strategy of domestic reforms and effective international negotiations.
- CBAM is an EU climate policy tool designed to prevent carbon leakage by taxing carbon-intensive imports.
- It will directly impact India's steel, cement, and aluminium exports to the EU and indirectly affect fertilizer prices.
- India needs to invest in clean energy and implement stricter carbon policies domestically.
Despite government claims of meeting record peak electricity demand, reports of power cuts persist across India, raising questions about the grid's resilience. India's peak power deficit on Friday stood at 1.7 GW, indicating load shedding in some areas. Experts suggest the actual deficit might be higher due to unreported local outages and suppressed demand. Key issues include inadequate distribution infrastructure, transmission bottlenecks preventing power flow, and challenges in integrating fluctuating renewable energy sources. While renewables are growing, their intermittency poses a burden on grid managers, especially during peak demand when solar power generation declines.
- India's electricity grid faces scrutiny over its resilience amidst record peak demand and persistent power cuts.
- Official figures show a peak power deficit of 1.7 GW, leading to load shedding in some regions.
- Experts argue that actual power deficits may be higher due to unreported local outages and suppressed demand.
The government's new rural jobs scheme, Viksit Bharat-Guarantee for Rozgar and Ajeevika Mission (VB-G RAM G), set to replace MGNREGA from July 1, will allocate higher funds to larger, poorer States. Draft rules propose using the 16th Finance Commission's horizontal devolution formula, which prioritizes States based on per capita GSDP distance. Unlike MGNREGA's 100% Centre-funded wage system, VB-G RAM G introduces a 60:40 Centre-State shared wage responsibility. From the second year, a portion of funding will also be based on 'performance criteria' such as timely wage payments and work completion.
- The new VB-G RAM G scheme will replace the 20-year-old MGNREGA from July 1.
- Funding allocation to States will be based on the 16th Finance Commission's horizontal devolution formula, prioritizing poorer States.
- The scheme introduces a shared wage responsibility between the Centre and States at a 60:40 ratio, unlike MGNREGA's 100% central funding.
The Hutti Gold Mines Company Ltd., India's sole functional gold mine located in Raichur district, Karnataka, experienced a significant financial windfall due to soaring global gold prices. The company projects an additional revenue of ₹633.34 crore in 2025-26, with the average gold selling price increasing by 34.11%. Its total revenue is expected to rise from ₹1,342.90 crore in 2024-2025 to ₹1,910.62 crore in 2025-2026, with net profit nearly doubling. Despite its production of 1,691.57 kg of gold, Hutti meets less than 1% of India's annual gold demand.
- Hutti Gold Mines Company Ltd., India's only functional gold mine, is experiencing a financial windfall due to soaring international gold prices.
- The company projects a significant increase in revenue and net profit for 2025-26.
- The average gold selling price increased by 34.11%, contributing to the profit surge.
Petrol and diesel prices were raised for the third time in eight days on Saturday, increasing by an average of 90 paise per litre across all variants. This cumulative hike, since May 15, amounts to approximately ₹4.8 per litre for both fuels. CNG prices also rose by ₹1 a kg, with a cumulative increase of ₹4 a kg in North India. The hikes are attributed to rising crude oil prices and disruptions in energy supplies due to the West Asia conflict, putting increased pressure on oil marketing companies. Kolkata experienced a comparatively steeper hike.
- Petrol and diesel prices increased for the third time in eight days, with an average hike of 90 paise per litre.
- The cumulative increase since May 15 is approximately ₹4.8 per litre for both petrol and diesel.
- CNG prices also saw a cumulative rise of ₹4 a kg in several North Indian cities.
India's economy started the financial year 2026-27 tepidly, with the Index of Eight Core Industries (ICI) showing a modest 1.7% growth in April. This slowdown, predating the West Asia crisis, suggests systemic domestic issues rather than transient external factors. Growth averaged 2.8% in FY 2025-26, down from 4.5% in FY 2024-25. Only steel, cement, and electricity sectors grew in April 2026, while crude oil and natural gas contracted for consecutive months. Lower fertilizer output and potential below-normal monsoon further indicate a grave prospect for the Indian economy, despite sustained government-propelled construction activity.
- The Index of Eight Core Industries (ICI) recorded a modest 1.7% growth in April 2026, indicating an economic slowdown.
- The slowdown is attributed to systemic domestic issues rather than solely external factors like the West Asia crisis.
- Crude oil and natural gas sectors have shown consecutive months of contraction, raising concerns about energy output.
The Reserve Bank of India (RBI) intervened heavily in the foreign exchange market, deploying dollar sales via state-run banks to halt the rupee's persistent slide, which had neared 97 against the U.S. dollar. This intervention caused the rupee to rally by about 70 paise. The article then delves into the debate on whether the rupee should be allowed to depreciate freely or if intervention is necessary. Proponents of non-intervention argue that a weaker rupee naturally curtails imports and boosts exports, adjusting the current account deficit. However, the counter-argument highlights that a falling rupee, especially when driven by speculation and rising import costs of essential goods like oil, can fuel inflation and prolong instability, necessitating intervention to break negative feedback loops.
- The RBI intervened in the foreign exchange market by selling dollars to prevent further depreciation of the rupee.
- The rupee had been experiencing sustained losses, nearing 97 against the U.S. dollar before intervention.
- There is a debate on whether the rupee should be allowed to depreciate freely or if RBI intervention is justified.
The Promotion and Regulation of Online Gaming Act, 2025, aimed at protecting vulnerable populations, is proving counterproductive, leading to a rise in offshore online betting and gambling. Studies show a significant shift from regulated domestic platforms to illegal offshore ones, which circumvent laws and facilitate money laundering and terror financing. These offshore platforms use advanced evasion tactics like VPNs and encrypted channels, making effective regulation difficult for domestic authorities. The article highlights that paternalistic bans rarely change consumer behavior but instead push users to unregulated channels. Drawing parallels from the UAE and Sri Lanka, which are moving towards regulated licensing frameworks, the author advocates for a strong domestic regulatory framework with accountability and consumer safeguards to address the menace, generate tax revenue, and fund awareness campaigns.
- The Promotion and Regulation of Online Gaming Act, 2025, intended to protect users, has inadvertently led to a surge in illegal offshore gaming.
- Offshore platforms facilitate money laundering and terror financing, using VPNs and encrypted channels to evade domestic oversight.
- Blanket bans are ineffective as they merely shift user activity to unregulated and more volatile channels.
Prime Minister Narendra Modi and Italian Premier Giorgia Meloni jointly outlined an expanded roadmap for India-Italy cooperation, envisioning a strategic partnership grounded in shared democratic values. The focus is on an emerging "Indo-Mediterranean" corridor for trade, technology, energy, and data, connecting the Indian Ocean to Europe. The India-Middle East-Europe Economic Corridor (IMEC) is highlighted as a key initiative to connect these regions through modern transport and digital networks. Both nations aim to exceed a €20-billion bilateral trade target by 2029, with key sectors for cooperation including defence, aerospace, clean technologies, machinery, automotive, chemicals, pharmaceuticals, textiles, and agri-food tourism.
- India and Italy have outlined an expanded roadmap for a strategic partnership, emphasizing shared values of freedom and democracy.
- The partnership focuses on an emerging "Indo-Mediterranean" corridor, facilitating trade, technology, energy, and data flow between the Indian Ocean and Europe.
- The India-Middle East-Europe Economic Corridor (IMEC) is a crucial initiative to connect these regions via modern infrastructure.
India's electric vehicle (EV) transition, particularly for two-wheelers, is gaining momentum, but the larger challenge lies in building a robust electricity grid to power freight and other heavy vehicles. Full electrification of India's 420 million registered vehicles would require an additional 900-1,100 TWh per year, equivalent to a third of current annual electricity generation. The article emphasizes that while two-wheelers have minimal grid impact, heavy goods vehicles will significantly strain the grid, necessitating substantial expansion of the power system. A diversified clean energy portfolio (solar, wind, nuclear, pumped hydro, batteries) is crucial, avoiding over-reliance on coal, and smart-charging capabilities must be mandated for new infrastructure.
- India's EV transition, while led by two-wheelers, faces its biggest challenge in electrifying freight and heavy goods vehicles, which will significantly increase electricity demand.
- Full electrification could require an additional 900-1,100 TWh annually, necessitating a substantial expansion of the power system.
- A diversified clean energy portfolio, including solar, wind, nuclear, and battery storage, is essential to meet demand reliably and sustainably.
Prime Minister Narendra Modi, speaking after the Third India-Nordic Summit in Oslo, highlighted the commitment of India and Nordic countries (Denmark, Finland, Iceland, Norway, Sweden) to democracy, rule of law, and multilateralism. The summit aimed to upgrade ties to a 'Green Technology and Innovation Strategic Partnership', focusing on sustainable energy, maritime cooperation, and polar research in the Arctic. Leaders also discussed deepening engagement to address global challenges, with all five Nordic leaders backing India's bid for a permanent UN Security Council seat and Nuclear Suppliers Group membership. Trade relations and the India-EU Free Trade Agreement were also key discussion points.
- The Third India-Nordic Summit in Oslo saw India and five Nordic countries commit to a 'Green Technology and Innovation Strategic Partnership'.
- Key areas of cooperation include sustainable energy, maritime cooperation, and polar research in the Arctic region.
- The leaders emphasized shared values of democracy, rule of law, and multilateralism as foundations for their natural partnership.
Prime Minister Narendra Modi urged citizens to reduce spending on petroleum products, edible oils, gold, and foreign travel, signaling concern over India's rising import dependence and its impact on foreign exchange reserves and the rupee. India's merchandise trade deficit hit a record $333 billion in 2025-26, driven by increased imports of gold, edible oils, fertilizers, and electronic components. The situation is exacerbated by higher crude oil prices and the government's failure to boost domestic production in key sectors like oilseeds. The RBI is intervening to prevent a rupee free-fall, but declining reserves limit its options, highlighting a critical economic vulnerability.
- Prime Minister Modi's appeal to reduce non-essential spending highlights India's growing concern over its import bill and foreign currency reserves.
- India's merchandise trade deficit reached a record $333 billion in 2025-26, primarily due to increased imports of gold, edible oils, fertilizers, and electronic components.
- The country's heavy dependence on imported crude oil, exacerbated by global price hikes, poses a significant threat to economic stability.
India faces challenges in fertilizer use efficiency, impacting food security and causing pollution. Highly dependent on imported fuel for urea production and almost entirely on imported phosphatic fertilizers, India's fertilizer subsidies are substantial but largely wasted. Inefficient and unbalanced use depletes soil organic matter, reduces water holding capacity, and threatens crop yields, creating a "fertilizer trap." The article advocates for moving beyond supply-side management to boost efficiency by promoting green manure, pulse-cereal rotations, and recycling manure/compost. It also highlights the lack of inter-ministerial coordination and procurement policies that favor rice, wheat, and sugarcane, hindering diversification.
- India's heavy reliance on imported fuel for urea and complete dependence on imported phosphatic fertilizers pose a significant economic and food security challenge.
- Inefficient and unbalanced fertilizer use leads to soil degradation, water pollution, and reduced crop yields, creating a "fertilizer trap."
- The government's subsidies are largely ineffective in improving efficiency, and neem-coated urea has not fully prevented nitrogen loss.
The Centre recently hiked retail petroleum product prices, highlighting India's vulnerability due to inadequate strategic petroleum and gas reserves. Despite warnings since 2018 about high crude prices, India's public sector oil marketing companies have been bleeding. The country's import dependence, especially for crude oil, has increased, with reserves only sufficient for 20 days of consumption, compared to China's 900 million barrels. The article criticizes the government's failure to build adequate reserves and diversify sources, making India susceptible to global price shocks and geopolitical events like the Russia-Ukraine war.
- India's strategic petroleum and gas reserves are inadequate, making the country vulnerable to global price shocks.
- Public sector oil marketing companies have faced financial strain due to high crude prices and insufficient reserves.
- India's current reserves are only sufficient for about 20 days of consumption, significantly less than China's 900 million barrels.
Prime Minister Narendra Modi met Norwegian PM Jonas Gahr Støre to upgrade bilateral ties to a "Green Strategic Partnership," aiming for $100 billion in investment and 10 million jobs in India. Discussions covered geopolitical conflicts in Ukraine and West Asia, with Norway emphasizing rules-based order and dialogue, while India seeks alternative oil/gas supplies. The partnership leverages Norway's technology and capital with India's large market, focusing on green energy, food security, and new frontiers from Arctic to outer space. They also signed a Trade and Economic Partnership Agreement and initiated trilateral development cooperation for Global South countries, alongside MoUs in health, space, and digital public infrastructure.
- India and Norway are upgrading their bilateral relationship to a "Green Strategic Partnership" with a target of $100 billion in investment and 10 million jobs.
- Discussions included geopolitical issues like Ukraine and West Asia, with both leaders emphasizing a rules-based international order and democratic values.
- The partnership aims to combine Norway's advanced technology and capital with India's market for green energy, food security, and new frontiers.
India's Permanent Representative to the UN, Parvathaneni Harish, condemned attacks on commercial shipping, endangering civilian crew, and impeding freedom of navigation in the Strait of Hormuz as 'unacceptable' at a UNECOSOC meeting. His remarks followed an attack on an India-flagged commercial vessel off the coast of Oman. Harish emphasized that international law regarding freedom of navigation must be fully respected and highlighted India's approach to the energy and fertilizer crisis caused by the West Asia conflict, advocating for a combination of short-term, structural measures, and international cooperation.
- India condemned attacks on commercial shipping and impediments to navigation in the Strait of Hormuz as unacceptable at the UN.
- The statement was made by India's Permanent Representative to the UN, Parvathaneni Harish, at a UNECOSOC meeting.
- The remarks followed a recent attack on an India-flagged commercial vessel off the coast of Oman.
Prime Minister Narendra Modi's visit to Norway and the Nordic Summit aims to boost trade, energy cooperation, and discuss global conflicts. India seeks more investment from Norwegian pension funds and business-to-business MoUs in energy. The visit also includes the third Nordic-India summit with leaders from Norway, Sweden, Finland, Iceland, and Denmark, focusing on geopolitical issues, climate, and green sustainability. Discussions will cover the Russia-Ukraine war, Israel-Gaza conflict, and US-Israel-Iran tensions, all impacting the global economy. India also upgraded ties with the Netherlands, signing 17 pacts.
- Prime Minister Modi's visit to Norway and the Nordic Summit focuses on enhancing trade, energy cooperation, and addressing global conflicts.
- India aims to attract more investment from Norwegian pension funds and secure business-to-business MoUs in the energy sector.
- The Nordic-India summit involves leaders from Norway, Sweden, Finland, Iceland, and Denmark, discussing geopolitical issues, climate, and sustainability.
Prime Minister Narendra Modi has urged Indian citizens to adopt austerity measures, including reducing fuel consumption, avoiding gold purchases, and buying Indian-made products, to help the economy and government finances. This push comes amidst a global energy crisis and rising Current Account Deficit (CAD), projected to grow to 2.5% of GDP. The war in West Asia has driven up oil and gold prices, increasing India's import bill and contributing to rupee depreciation. The government has also implemented measures like doubling import tax on gold and silver and restricting silver imports. Critics question the timing of these appeals, coming after state elections.
- PM Modi has called for public austerity measures to address economic challenges, including reducing fuel and gold imports.
- The initiatives aim to mitigate the impact of the global energy crisis and a rising Current Account Deficit (CAD).
- The CAD is projected to increase to 2.5% of GDP this financial year, up from 1.4% in late 2025.
The implementation of the India-U.K. Comprehensive Economic and Trade Agreement (CETA), expected in May 2026, has encountered a late-stage hurdle due to new U.K. regulations on steel imports. The U.K. announced it would significantly cut tariff-free steel import volumes by 60% and double the tariff on above-quota imports to 50% from July 1, a measure not factored into the FTA negotiations. Commerce Secretary Rajesh Agrawal stated that both sides are working on a "creative solution" to address this "sticking point" and operationalize the CETA at an early date, highlighting the challenge posed by the unexpected policy change.
- The India-U.K. Comprehensive Economic and Trade Agreement (CETA) faces a late-stage hurdle before implementation.
- The issue stems from new U.K. regulations on steel imports, which were not part of the original FTA negotiations.
- The U.K. plans to cut tariff-free steel import volumes by 60% and increase the above-quota tariff to 50% from July 1.
India and the UAE signed a framework defence cooperation agreement and pacts on building India's strategic petroleum reserves and LNG supplies during Prime Minister Narendra Modi's brief stopover in Abu Dhabi. PM Modi met UAE President Mohammad Bin Zayed Al Nahyan (MbZ) and condemned attacks on the UAE, praising its restraint. The Strategic Defence Cooperation Framework aims to strengthen collaboration in defence manufacturing, technology, equipment, and industrial cooperation, including maritime security and cyber-defence. Abu Dhabi National Oil Company signed MoUs for crude oil storage in India and potential storage facilities in UAE, boosting India's energy security.
- India and the UAE signed a framework defence cooperation agreement and energy pacts during PM Modi's visit to Abu Dhabi.
- The defence agreement focuses on collaboration in manufacturing, technology, equipment, and industrial cooperation, including maritime security and cyber-defence.
- Energy pacts include MoUs with Abu Dhabi National Oil Company for crude oil storage in India and potential storage facilities in UAE.
The article argues that India needs to prioritize productivity growth, not just GDP growth, to achieve its 'Viksit Bharat' goal by 2047. It highlights that India's manufacturing sector, characterized by low productivity and reliance on cheap labor, needs significant transformation. The author suggests that India's growth has been largely driven by capital accumulation and labor input, with limited contribution from Total Factor Productivity (TFP). To boost TFP, India must invest in R&D, innovation, and human capital, and address issues like informal labor, low-quality jobs, and weak firm capabilities. The article emphasizes that a focus on high-value manufacturing and services, along with reforms, is crucial for sustainable and inclusive development.
- Achieving 'Viksit Bharat' by 2047 requires a strong focus on productivity growth, not solely GDP growth.
- India's manufacturing sector needs significant transformation to move beyond low-productivity, labor-intensive models.
- Total Factor Productivity (TFP) growth has been limited, indicating a need for investment in R&D, innovation, and human capital.