Key Points to Ponder:
— What is the history of India-Malaysia relations?
— What are the areas of cooperation between both countries?
— What is a Comprehensive Strategic Partnership?
— What is India’s Act East Policy?
— How does cross-border terror pose a huge security challenge for India?
— India’s counter-terrorism doctrine—Know its evolution.
— What is the Association of Southeast Asian Nations (ASEAN) and its member countries?
— Read about the FATF and International Solar Alliance.
— Map work: Locate Malaysia and other ASEAN member countries on a map.
Key Takeaways:
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— “On terrorism, our message is clear: no double standards, no compromise,” Modi said during the joint press statement with his Malaysian counterpart, Anwar Ibrahim, on Sunday. The statement came soon after the bilateral talks between the two leaders during PM Modi’s official visit to the country.
— In the field of security, we will strengthen cooperation in counter-terrorism, intelligence sharing and maritime security,” Modi said, adding, “We will expand defence cooperation.” “Along with AI and digital technologies, we will further our collaboration in semiconductors, health, and food security,” said the prime minister, charting the way ahead for the bilateral ties between the two ASEAN partners.
— Besides a slew of pacts signed in areas like defence and security, digital payments, social security for Indian workers, audio-visual collaboration and tourism, the joint statement emerging out of the delegation-level talks takes a clear stand on terrorism.
— The two prime ministers unequivocally and strongly condemned terrorism in all its forms and manifestations, including cross-border terrorism, said the joint statement. They called for zero tolerance of terrorism and for concerted international efforts to combat terrorism in a comprehensive and sustained manner, it added.
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— The joint statement is a clear indication that Malaysia, which has a large Indian-origin population, has prioritised its bilateral relationship with India, marking a shift from its stand in the recent past, where it was seen to be aligning with Pakistan on issues like Kashmir.
— They also recognised “the linkages between terrorism and transnational organised crime, and agreed to cooperate in the area of transnational organised crime, including through sharing of information and best practices”. The two leaders reaffirmed their commitment to strengthen bilateral and multilateral cooperation in countering terrorism, including in the UN and FATF, it said.
Prime Minister Narendra Modi with the Malaysian Prime Minister Anwar Ibrahim during their joint press statement in Kuala Lumpur on February 8. Photo: X/@PMOIndia
— Following wide-ranging talks between him and Ibrahim, Modi also spoke about New Delhi’s approach to the Indo-Pacific, saying, “The Indo-Pacific region is emerging as the growth engine of the world.” Ibrahim, for his part, noted that India and Malaysia are steadily expanding cooperation in areas including trade, investment, connectivity and defence, while also pointing to India’s significant rise on the global trade and economic front.
— Following their meeting, Anwar and Modi also witnessed the exchange of 11 cooperation agreements, including on semiconductors, disaster management, and peacekeeping. Anwar said India and Malaysia would continue efforts to promote the use of local-currency settlement and expressed hope that bilateral trade would surpass last year’s $18.6 billion mark.
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From the Politics Page- “From business to tech, India inks key pacts with Malaysia”
— Prime Minister Narendra Modi on Sunday held wide-ranging talks with his Malaysian counterpart Anwar Ibrahim in Putrajaya, aimed at deepening the Comprehensive Strategic Partnership between the two nations with a special focus on artificial intelligence, defence and semiconductor sectors.
— The discussions were followed by the exchange of several agreements and memoranda of understanding covering strategic, economic, technological and people-to-people engagement. — With Malaysia accounting for roughly 13% of global semiconductor trade, the two leaders sought to integrate India’s design capabilities with Malaysia’s manufacturing and packaging strengths, acknowledging the semiconductor industry’s strategic importance to the global technology landscape.
— In the energy sector, Malaysia’s PETRONAS and Gentari are expanding their presence in India’s solar and green hydrogen markets, aligning with a shared goal of achieving net-zero emissions. According to the joint statement, Malaysia also appreciated India’s initiative in establishing the International Solar Alliance (ISA).
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— The Indian Electronics and Semiconductor Association (IESA) and its Malaysian counterpart (MSIA) are now officially linked to stabilise supply chains against global shocks, added the statement.
— The two leaders also welcomed the outcomes of the Malaysia-India Defence Cooperation Committee (MIDCOM) and its subcommittees, including the terms of reference on the establishment of a Strategic Affairs Working Group (SAWG) and Su-30 Forum. The Su-30 Forum enables the Indian Air Force (IAF) and the Royal Malaysian Air Force (RMAF) to share technical expertise, maintenance protocols, and spare parts strategies, thereby bypassing supply chain hurdles.
Do You Know:
— Malaysia has a 2.9 million-strong Indian diaspora, the third-largest in the world, and the second-largest PIO community (2.75 million).
— The ‘Look East’ policy of India was formulated in 1992. The stated aim of the ‘Look East’ policy was to improve the level of relations between India and the countries in Southeast Asia and project India as a counterweight to China since many of the Southeast Asian countries perceived China as a threat to their security. The thrust of the ‘Look East’ policy initially was mainly economic relations and trade. However, due to the rise of China, a strategic dimension was added to it.
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— Prime Minister Narendra Modi launched India’s ‘Act East’ policy in 2014. The ‘Act East’ policy can be explained as a diplomatic initiative to promote India’s economic, strategic and cultural relations with the Asia-Pacific region.
— It is the evolution of India’s ‘Look East’ policy towards the Asia-Pacific region. The ‘Act East’ policy allowed India to deepen its relations with the countries in the region which had concerns regarding China’s growing economic and military might.
Other Important Articles Covering the same topic:
📍PM Modi highlighted Tamil’s presence in Malaysia: the centuries-old story of how the language crossed the seas
📍Trust has become India’s strongest currency: Modi
Previous year UPSC Mains Question Covering similar theme:
Evaluate the economic and strategic dimensions of India’s Look East Policy in the context of the post-Cold War international scenario. (UPSC CSE 2016)
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Syllabus:
Preliminary Examination: Current events of national importance and Polity.
Mains Examination: General Studies-II: Government policies and interventions for development in various sectors and issues arising out of their design and implementation, Functions and responsibilities of the Union and the States.
What’s the ongoing story: The Prime Minister’s Office (PMO) has told the Lok Sabha Secretariat that Parliament questions and matters related to PM CARES Fund, the Prime Minister’s National Relief Fund (PMNRF) and the National Defence Fund (NDF) are not admissible under rules related to the conduct of business in Lok Sabha, The Indian Express has learnt.
Key Points to Ponder:
— Read about the PM CARES, PMNRF and NDF in detail.
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(Thought Process: Know how these funds are structured, funded, governed and audited.)
— Why can’t Parliament question these funds?
— What was the objective of introducing the PM CARES Fund?
— Who can donate to the PM CARES Fund?
— What are the criticisms related to the PM CARES Fund?
— What are the different funds of the government?
— How is the PM CARES Fund different from the PMNRF?
— Know about the Consolidated Fund of India, Contingency Fund of India and Public Account of India.
Key Takeaways:
— It is learnt that on January 30, the PMO told the Lok Sabha Secretariat that questions and matters related to the three funds are not permissible under Rule 41(2) (viii) and 41(2)(xvii) of the Rules of Procedure and Conduct of Business in Lok Sabha.
— Under the stipulated conditions that govern the right to ask questions in the Lok Sabha, Rule 41(2) (viii) states that “it shall not relate to a matter which is not primarily the concern of the Government of India”. Rule 41(2) (xvii) states “it shall not raise matters that are under the control of bodies or persons not primarily responsible to the Government of India”.
— The reasoning for questions and matters not being admissible in Lok Sabha given by the PMO, it is learnt, was that the corpus of these funds is constituted entirely with voluntary public contribution and not from any allocation out of the Consolidated Fund of India.
— The PMO told the Lok Sabha Secretariat that in case a situation arises to determine the admissibility of a question or notice of zero hour or special mention seeking information on the three funds arises, the conditions in the provisions may be exercised, it is learnt.
— The PM CARES fund was set up on March 27, 2020, following the Covid outbreak. “Keeping in mind the need for having a dedicated fund with the primary objective of dealing with any kind of emergency or distress situation, like posed by the COVID-19 pandemic, and to provide relief to the affected, a public charitable trust under the name of ‘Prime Minister’s Citizen Assistance and Relief in Emergency Situations Fund (PM CARES Fund)’ has been set up,” the official website of PM CARES fund states.
— The fund was registered as a Public Charitable Trust and its trust deed has been registered under the Registration Act, 1908, at New Delhi on March 27, 2020.
— In January 2023, the Centre had informed the Delhi High Court that PM CARES Fund has been set up as a public charitable trust and is not created under the Constitution or any law made by the Parliament or the state. The Centre had made the submission during the hearing of a plea seeking to declare the fund a “state” under Article 12 of the Constitution to ensure transparency in its functioning.
— The Centre in its affidavit had said that the trust is “neither intended to be or in fact owned or controlled” by any government or any instrumentality of the government and the composition of the board of trustees consisting of holders of public office is merely for administrative convenience.The affidavit also stated that since it is not constituted under law or the Constitution, PMCARES does not constitute a public authority under the provisions of the RTI Act.
— On August 18, 2020, the Supreme Court had “refused” to order transfer of funds from the PM CARES Fund to the National Disaster Response Fund (NDRF), saying they “are two entirely different funds with different object and purpose” and “there is no occasion” for such a direction.
— The apex court had also said guidelines specifically provide for audit of the NDRF by the Comptroller & Auditor General of India, but PM CARES Fund is a public charitable trust due to which “there is no occasion” for such an audit.
— The Prime Minister’s National Relief Fund (PMNRF) was established in January 1948 with public contributions to assist displaced persons from Pakistan. Its resources are now utilised primarily to render immediate relief to families of those killed in natural calamities like floods, cyclones and earthquakes, etc., and to the victims of major accidents and riots.
— The National Defence Fund (NDF) is used for the welfare of members of the Armed Forces, including paramilitary forces, and their dependents. The fund is administered by an Executive Committee, with the PM as Chairperson, and Defence, Finance and Home Ministers as Members, according to its official website.
Do You Know:
— PM CARES is a public charitable trust set up to raise funds for national emergencies such as Covid. PMNRF provides immediate relief to people affected by natural calamities, major accidents, riots, etc. The NDF is meant specifically for the welfare of members of the armed and paramilitary forces and support to their families.
— Article 266 of the Constitution of India contains provisions relating to the Consolidated Fund of India (CFI). It is made up of all of the Union Government’s revenues, loans, and receipts from loan recoveries. All Union Government expenditure is incurred through the CFI, and no funds can be drawn from the CFI without prior authorisation from Parliament.
Other Important Articles Covering the same topic:
📍Knowledge Nugget: PMO cites parliamentary rules to bar questions on PM CARES, PM NRF and defence funds; what are these funds?
UPSC Prelims Practice Question Covering similar theme:
(1) Consider the following statements with reference to the PM CARES Fund:
1. It has been registered as a Public Charitable Trust
2. It receives budgetary support from the Consolidated Fund of India.
3. Donations to the fund qualify as CSR expenditure under the Companies Act, 2013.
Which of the statements given above is/are correct?
(a) 1 only
(b) 1 and 3 only
(c) 2 and 3 only
(d) 1, 2 and 3
POLITICS
Syllabus:
Preliminary Examination: Current events of national importance, Indian Polity and Governance-Constitution.
Mains Examination: General Studies-II: Salient features of the Representation of People’s Act, Constitution of India — features, significant provisions and basic structure.
What’s the ongoing story: With the role of the “micro observers” during the Special Intensive Revision (SIR) of electoral rolls in West Bengal under scrutiny, the Election Commission last week told the Supreme Court that they have been deputed only to facilitate the officials on the ground, while Electoral Registration Officers (EROs) continue to decide on additions and deletions of names from the rolls.
Key Points to Ponder:
— What is the Special Intensive Revision?
— What is the purpose of conducting the SIR?
— What is the legal backing for conducting SIR?
— Who are micro observers and what are their functions?
— What are the concerns related to SIR?
— What is the role and function of Electoral Registration Officers (ERO) or Assistant ERO?
— Read about the Election Commission of India, its powers and functions.
Key Takeaways:
— Replying to an application filed by one of the petitioners, TMC member of Parliament Dola Sen, against the SIR on January 24, the EC said in its affidavit on February 4: “It is false to suggest that statutory powers have been vested in the micro observers.”
— Incidentally, on February 4, West Bengal CM Mamata Banerjee, who is also one of the petitioners, argued in person in the SC, saying that her state was being targeted as 8,100 Central government employees had been appointed as micro observers. The EC had not appointed micro observers in the other eight states and three Union Territories where the SIR is also underway.
— In its affidavit in response to Sen, the EC said it was a fact that the micro observers were Central government or Public Sector Undertaking officers who were on “deputation” and under “control” of the Bengal Chief Electoral Officer. “Their functions are purely facilitative, and the final decision qua acceptance or rejection of eligibility of any elector remains with the ERO/AERO. Therefore, merely because some micro observers have also been appointed from public sector organisations does not mean that they lack competence…” it said.
— With over 1 crore electors, out of a total of 7.08 crore, in Bengal being asked to submit additional documents to establish their eligibility, including citizenship, the EC said the family registers maintained at Anganwadi centres “cannot be accepted as a valid document” for the SIR.
Do You Know:
— According to the Representation of the People Act, 1950, only the Electoral Registration Officers (ERO) or Assistant ERO of an Assembly constituency can add or delete names from the rolls.
— Article 324(1) of the Constitution gives the ECI the power of “superintendence, direction and control of the preparation of the electoral rolls for, and the conduct of” elections to Parliament and state legislatures.
— Under Section 21(3) of The Representation of the People Act, 1950, the ECI “may at any time… direct a special revision of the electoral roll for any constituency or part of a constituency in such manner as it may think fit”.
— The Registration of Electors’ Rules, 1960, says the revision of rolls can be carried out “either intensively or summarily or partly intensively and partly summarily, as the [ECI] may direct”. In an intensive revision, the electoral roll is prepared afresh; in a summary revision, the roll is amended.
— Section 13B of the Representation of the People Act, 1950, empowers the Electoral Registration Officer (ERO) for each constituency to prepare and revise the electoral roll. In discharging this function, the ERO can employ persons deemed fit for the preparation and revision of the electoral roll. This statutory provision enables the appointment of BLOs.
— A BLO serves as a representative of the Election Commission of India (ECI) at the grassroots level and is responsible for collecting authentic field information about the electoral roll. BLOs, who are familiar with local electors, act as guides for voters at their doorstep in matters of electoral enrolment, correction, and verification.
Other Important Articles Covering the same topic:
📍Why Election Commission has asked for electoral rolls to be revised
📍Special Intensive Revision (SIR): Why is it important? Why ECI is doing it now and what you need to do
Previous year UPSC Prelims Question Covering similar theme:
(2) Consider the following statements: (UPSC CSE 2017)
1. The Election Commission of India is a five-member body.
2. The Union Ministry of Home Affairs decides the election schedule for the conduct of both general elections and bye-elections.
3. Election Commission resolves the disputes relating to splits/mergers of recognised political parties.
Which of the statements given above is/are correct?
(a) 1 and 2 only
(b) 2 only
(c) 2 and 3 only
(d) 3 only
Previous year UPSC Mains Question Covering similar theme:
To enhance the quality of democracy in India the Election Commission of India has proposed electoral reforms in 2016. What are the suggested reforms and how far are they significant to make democracy successful? (UPSC CSE 2017)
EXPLAINED
Syllabus:
Preliminary Examination: Current events of national importance and economic development.
Mains Examination: General Studies-II, III: Government policies and interventions for development in various sectors and issues arising out of their design and implementation, Indian Economy and issues relating to planning, mobilization, of resources.
What’s the ongoing story: On February 3, Andhra Pradesh and Assam borrowed Rs 1,100 crore and Rs 1,000 crore respectively through auction sales of 15-year state government securities at an average yield or interest rate of 7.66%.
Key Points to Ponder:
— What are the different sources of government borrowing?
— What are government securities?
— What does the yield on government security indicate?
— Read about the Reserve Bank of India and its functions.
— What is the repo rate?
— What is meant by “limited transmission” of monetary policy?
— What is the “crowding out” effect?
— What is liquidity tightening in the banking system?
— What is the debt-GDP ratio?
— Know about the Fiscal Responsibility and Budget Management Act, 2003.
— What are the concerns associated with the rising debt levels of the state and central government?
Key Takeaways:
— One year ago — on February 4, 2025 — the two states had paid only 7.15-7.16% at the auction of securities with the same 15-year tenor that raised Rs 2,000 crore and Rs 900 crore respectively.
— To put these into perspective, the Reserve Bank of India (RBI) has, since February 6, 2025, cut its benchmark policy repo rate from 6.5% to 5.25%. But this reduction — in the rate at which it provides overnight (i.e. one-day maturity) loans to commercial banks — hasn’t led to any lowering of borrowing costs for state governments.
— On the contrary, state governments are today paying 0.4-0.5 percentage points more to borrow for 10-15 years than what they were last year at this time.
— Moreover, it isn’t the states alone. In the last one year, yields of 10-year Government of India securities, too, have risen from 6.66% to 6.73%, notwithstanding RBI’s key lending rate coming down by 1.25 percentage points over this period.
— Why are governments paying more despite RBI’s rate cuts? There are two main reasons for that. The first is structural, having to do with the sheer scale of borrowings by both the Centre and the state governments. The accompanying chart shows their outstanding liabilities — basically debt, on which interest is payable along with the principal amount — as a percentage of India’s gross domestic product at current market prices.
— The Centre’s outstanding debt-GDP ratio fell from 51.7% to 48.1% between 2011-12 and 2018-19. An economic growth slowdown in 2019-20, followed by the expansionary fiscal response to the Covid-19 pandemic-induced disruptions, led to a spike in the ratio to 60.7% in 2020-21. There has been a modest drop since then, to 55.2% in 2025-26 and a budgeted 54.7% for the coming fiscal year ending March 31, 2027.
— It has been somewhat different for the states, with their consolidated debt actually increasing from 22.8% in 2011-12 before peaking at 31% in the 2020-21 Covid year. Thereafter, it has only gradually declined to 29.2% in 2025-26. This is a far cry from the debt-GDP targets of 40% for the Centre and 20% for the state governments combined by 2024-25, set under the 2018 amendment to the Fiscal Responsibility and Budget Management Act, 2003.
— The rising debt levels have, first of all, resulted in ballooning interest payments. Secondly, just as interest payments are consuming a large share of their budgets and eating into other expenditures, government borrowings tend to “crowd out” private borrowings, thereby driving up rates in the money market.
— Excessive government borrowings may not cause much “crowding out”, when there is enough economic slack and liquidity in the system. This was, indeed, the case in the last many years, when private sector investment and the attendant credit demand was lacklustre. On top of it was the abundant supply of liquidity from foreign capital inflows that, in net terms, averaged over $75 billion annually between 2017-18 and 2023-24. As the RBI bought up the surplus dollars gushing in and added to its foreign exchange reserves, it also ended up injecting rupee liquidity into the banking system.
— That has, however, changed from 2024-25. Net foreign capital inflows were at only about $18 billion that fiscal and at $8.6 billion during April-September 2025.
— The end-result is that just when a recovery in private sector credit demand, if not investment, seems underway, there is a hardening of interest rates from a tightening of liquidity. The markets haven’t also taken kindly to the government’s borrowing programme; it is perceived as too large in the present scenario where liquidity isn’t plentiful.
— Not for nothing the RBI’s repo rate cuts have had “limited transmission”, to use financial jargon. While its policy lending rate has fallen by 1.25 percentage points since last February, commercial banks have lowered rates by an average of 1.05 percentage points on fresh loans and 0.95 percentage points on term deposits. This, even as the cost of borrowings for the government — both the Centre and states — has gone up.
— Liquidity tightening could become a real problem if investment sentiment revives, especially with fructifying of the bilateral trade agreement between India and the United States. The hope is that it would also stimulate the return of foreign portfolio investors. Their pouring money into Indian markets after an extended phase of selling will definitely help ease the current liquidity concerns, among other things.
Do You Know:
— The debt-to-GDP ratio is a metric that compares a country’s public debt to its gross domestic product (GDP).
— Various direct and indirect instruments are used by the RBI for implementing monetary policy, including Repo Rate, Reverse Repo Rate, Marginal Standing Facility (MSF) under the Liquidity Adjustment Facility (LAF), Bank Rate, Cash Reserve Ratio (CRR), Open Market Operations (OMOs) and Market Stabilisation Scheme (MSS).
Other Important Articles Covering the same topic:
📍UPSC Issue at a Glance | RBI Explained – History, tools of monetary policy, and surplus transfer
Previous year UPSC Prelims Question Covering similar theme:
(3) Which of the following are the sources of income for the Reserve Bank of India? (UPSC CSE 2025)
I. Buying and selling Government bonds
II. Buying and selling foreign currency
III. Pension fund management
IV. Lending to private companies
V. Printing and distributing currency notes
Select the correct answer using the code given below.
(a) I and II only
(b) II, III and IV
(c) I, III, IV and V
(d) I , II and V
Syllabus:
Preliminary Examination: Current events of national importance.
Mains Examination: General Studies-II, III: Bilateral, regional and global groupings and agreements involving India and/or affecting India’s interests, Science and Technology- developments and their applications and effects in everyday life, Awareness in the fields of IT.
What’s the ongoing story: The AI Impact Summit 2026, which India will host from February 16 to 20, is intended to generate actionable recommendations that contribute to long-term artificial intelligence (AI) governance objectives rather than framing immediate binding regulations.
Key Points to Ponder:
— Read about Artificial Intelligence and its application.
— What are the various applications of AI?
— What is the purpose of the AI impact summit?
— What are the ethical issues related to AI?
— What are the initiatives taken by India to integrate AI?
— Read about the IndiaAI Mission.
— What is the Bletchley Declaration?
— Why is a global compact on AI the need of the hour?
— What are the important bilateral cooperation signed by India to promote AI?
Key Takeaways:
— Coming to the Global South for the first time, the summit represents the latest chapter in an evolving international conversation on AI governance. What began as the AI Safety Summit at Bletchley Park in the UK in November 2023, where 28 countries signed the landmark Bletchley Declaration focusing on identifying AI safety risks, has progressively broadened its scope. The Seoul Summit in May 2024 expanded discussions to include innovation and inclusivity alongside safety, while the Paris AI Action Summit in February 2025 emphasised practical implementation and economic opportunities.
— India’s pitch is somewhat different. Where previous summits wrestled with catastrophic risks and regulatory frameworks, New Delhi is centring the conversation on what Electronics and IT Secretary S Krishnan calls “People, Planet, and Progress” – to build AI solutions that focus on on-ground issues, an approach that reflects India’s position both as an aspiring AI power and a voice for the Global South.
— The summit comes at a time of global upheavals, as conversations around AI have evolved from just looking at the upsides of the technology to mounting concerns over the technology’s impact on everyday jobs and its drain on resources like energy and power. Yet, most governments have outlined the technology as a strategic asset. India wants a larger share of the pie.
— Union IT Minister Ashwini Vaishnaw has billed the summit as the biggest one so far, and had last month said the government has received phenomenal response from across the world.
— The event is set to deliberate upon multiple themes, with working groups deliberating on issues, including AI and its impact on work, trust and safety protocols for AI models, and using AI in specific industries. The government will also launch a number of indigenous AI language models during the summit, including both foundational models and small language models, one of the key focus areas of the Rs 10,370 crore IndiaAI Mission.
— The summit will feature a startup showcase of more than 500 AI startups and host around 500 sessions alongside the main programme, making it one of the most comprehensive AI-focused global convenings, the government said in a press statement.
— The AI Summit is not a formal grouping of countries. Invitations to countries to join the forum are decided by the host country. When the UK hosted the first summit, there was pushback from some of Britain’s closest allies and its own lawmakers over its invitation to China, but the country’s government eventually went ahead with the invitation. China was also part of the subsequent two summits.
— India’s invitation to China marked yet another step in the easing of bilateral ties. Earlier this year, direct flights between the two countries resumed after a gap of over five years. Similarly, while China earlier stonewalled applications by companies that supply components made of rare earth metals to India’s automobile manufacturers (it imposed a blockade on critical minerals following US tariffs), it has now started to clear some applications.
Do You Know:
— Artificial intelligence (AI) refers to the field of computer science which aims to make computer systems think, reason, learn, and act to solve a complex system like humans.
— AI can be classified into two types: Artificial Narrow Intelligence (ANI) also known as weak AI and Artificial General Intelligence (AGI) also referred to as strong AI.
— Bletchley Declaration: Agreed by 28 countries, including the US, UK, and China, Bletchley Declaration is the first global pact on tackling frontier AI risks. The declaration lays out plans for greater transparency from AI developers regarding safety practices and more scientific collaboration on understanding AI’s risks.
Other Important Articles Covering the same topic:
📍AI basics: What are artificial intelligence and machine learning?
📍UPSC Issue at a Glance | Deepfakes: 5 Key Questions You Must Know for Prelims and Mains
Previous year UPSC Prelims Question Covering similar theme:
(4) With the present state of development, Artificial Intelligence can effectively do which of the following? (UPSC CSE 2020)
1. Bring down electricity consumption in industrial units
2. Create meaningful short stories and songs
3. Disease diagnosis
4. Text-to-Speech Conversion
5. Wireless transmission of electrical energy
Select the correct answer using the code given below:
(a) 1, 2, 3 and 5 only
(b) 1, 3 and 4 only
(c) 2, 4 and 5 only
(d) 1, 2, 3, 4 and 5
Previous year UPSC Mains Question Covering similar theme:
Introduce the concept of Artificial Intelligence (AI). How does Al help clinical diagnosis? Do you perceive any threat to privacy of the individual in the use of Al in healthcare? (UPSC CSE 2023)
THE EDITORIAL PAGE
Syllabus:
Preliminary Examination: Current events of national and international importance.
Mains Examination: General Studies-II, III: Bilateral, regional and global groupings and agreements involving India and/or affecting India’s interests; Indian Economy and issues relating to planning, mobilisation of resources, growth, development and employment.
What’s the ongoing story: Soumya Kanti Ghosh writes- “Bilateral trade deals have been characterised by long negotiations and reasonable concessions on either side to iron out workable agreements. In this respect, India’s two bilateral FTAs — one with the EU and the most recent one with the US — stand out as significant developments connecting the world’s largest economies.”
Key Points to Ponder:
— What are the major agreements signed between India and the US?
— Know the key highlights of the India-US Interim trade deal.
— What is the significance of the India-US trade deal? How important is it for India?
— What was the impact of US reciprocal tariffs on India?
— What is the status of India’s oil import from Russia?
— What are the key takeaways of 16th India-European Union Summit ?
— What is the significance of the recent India–EU FTA?
— What are the challenges in implementing the India–EU Free Trade Agreement?
— What are the concerns related to the India-US interim trade deal?
Key Takeaways:
— “Both FTAs have different histories, commonalities and differences. India’s position is based on, one, not budging from its stated position of protecting the vulnerable areas of agriculture, dairy and SMEs, ensuring the interests of the small farmers are not compromised, and two, the emergence of a mature, market-driven economy in India, driven by wider reforms across governance, regulation, and market infrastructure.”
— “The differences include some key points, notably the issue of CBAM in the EU negotiations and its absence in the US FTA negotiations. Views on labour mobility also differ across the two FTAs.”
— “Looking at the EU FTA, India has secured unprecedented market access for more than 99 per cent of Indian exports, by trade value, to the EU, which also bolsters the “Make in India” initiative. Beyond goods, it unlocks high-value commitments in services, supported by a comprehensive mobility framework enabling the seamless movement of skilled Indian professionals.”
— “In contrast, the US interim agreement was a direct by-product of emerging geopolitical realities. The fact that the deal with the US was given the go-ahead only after putting in place historic deals with the EU and the UK stands testimony to India’s diplomatic acumen. The deal with the US should thus be viewed as part of a series of formal negotiations spanning the Middle East, the UK, and New Zealand, all of which indicate the emergence of a new trade order in South Asia.”
— “Before we discuss the impact of the US trade deal, a couple of points are in order on the misguided rhetoric around the deal. First, even after the 18 per cent tariff has come into force, the gap between the MFN simple average tariff and the new tariff is among the lowest for India relative to most countries, including its neighbours.”
— “Second, India’s exports post‑deal could still see an upside, as exports of goods and services — even with a 50 per cent tariff regime — have almost matched a hypothetical no‑tariff scenario in the first nine months of FY26 by registering growth of 4.3 per cent.”
— “Third, hypothetically, the complete substitution of Russian crude with Venezuelan crude (Merey 16) has clear benefits for the domestic economy, as heavy crude discounts in the range of $10–12 per barrel can ensure commercial viability. In fact, India could save up to $3 billion on its import bill. This suggests that the trade deal will not significantly affect domestic inflation, even after sacrificing the Russian discount (end of hostilities in Ukraine may even reduce the discount from Russia).”
— “Now, the benefits. The US trade deal opens up a massive $118 billion global market for textiles and apparels. Further, the 25 per cent penalty on Russian oil imports will cease to exist, provided necessary adjustments to the oil import basket are made. The US has also indicated that this interim framework is a stepping stone toward a full Bilateral Trade Agreement (BTA). Further tariff reductions on Indian goods will be considered during BTA negotiations.”
— “The two deals share some similarities, notably shielding the imports of agri and dairy products to India. Under the US deal, India will eliminate or reduce tariffs on all US industrial goods and a wide range of US food and agricultural products, including dried distillers’ grains (DDGs), red sorghum for animal feed, tree nuts, fresh and processed fruit, soyabean oil, wine, and spirits, while protecting the broader domestic market…Hence this decision clearly benefits India. Similarly, almonds, walnuts, pistachios and cranberry import from USA will now attract significantly lower duties and benefit India consumers. India produces these fruits in very limited quantities and these are in high demand given their nutritional contents.”
— “Notably, regarding non-tariff barriers and digital trade, both the US and the EU have indicated flexibility and a willingness for dialogue.”
— “In terms of benefits, $75 billion of Indian exports to the EU are poised for take-off, with $33 billion in labour-intensive sectors set to gain significantly from preferential access under the EU FTA.”
— “The EU FTA and the interim BTA with the US open a new chapter in India’s trade history. Today, consumers are the real kings, conscious of the choices they make across backward and forward integration. This changed reality must be recognised, and adjustments made. India has effectively established a reverse Byzantine equation, engaging in dialogue with all key stakeholders on its own terms and pace, building a springboard for a win-win proposition.”
From the Ideas Page- In next phase of India-US trade talks, bring to the table: Balance, clarity, reciprocity
— Ajay Srivastava writes- “On February 6, India and the US released a joint statement outlining the framework for an interim trade agreement under the proposed Bilateral Trade Agreement. The interim framework reflects a familiar US negotiating approach — securing market access, regulatory concessions, and strategic alignment without offering commensurate commitments in return. The agreement risks locking India into obligations that are difficult to reverse.”
— “Both sides have agreed to strengthen “economic security alignment” to address non-market policies of third countries. In effect, this seeks to align India’s economic and security policies with those of the US, and therefore warrants serious caution. Agreeing to such language could have far-reaching consequences. If the US were to impose steep tariffs on imports from countries like Russia or China on economic security grounds, India could be expected to adopt similar measures. India may also be required to restrict trade or financial transactions with third countries sanctioned by the US, severely limiting its ability to pursue an independent foreign policy.”
— “Similar commitments have already been extracted by the US from Malaysia. Given India’s size, global role, and sovereign interests, tying its economic and security policies too closely to any single country carries significant risks. India should therefore seek to clearly limit or opt out of this aspect in the next phase of negotiations.”
— “India is already highly dependent on US software and technology firms, making it, in effect, a digital colony. Against this backdrop, the digital trade language in the joint statement is worrying, as it signals a readiness to give up long-held policy positions.”
— “The US would require India to remove barriers to digital trade and adopt binding rules that could force it to drop its opposition at the WTO to a permanent moratorium on customs duties on electronic transmissions. Such commitments would also limit India’s future ability to tax and regulate global technology firms.”
— “Accepting such terms would weaken India’s position at the WTO and sharply reduce its digital policy space. It would limit India’s ability to levy equalisation taxes, regulate large digital platforms, or shape its digital economy. For a country already dependent on foreign tech firms, giving up regulatory and fiscal autonomy in the sector would be a costly and hard-to-reverse mistake.”
— “India has agreed to ease several so-called non-tariff barriers. These include relaxing rules on import of medical devices, removing import licensing for US ICT products, and deciding within six months whether to accept US or international standards and testing procedures in certain sectors. India has also committed to addressing regulatory issues affecting US food and agricultural exports. Malaysia accepted US sanitary and health certificates for dairy, meat, and poultry imports, effectively prioritising US standards over its own domestic regulations. Crucially, the US did not offer similar regulatory access or recognition for Malaysian exports. India could face a similar outcome.”
— “As negotiations proceed, India must resist pressure to trade long-term regulatory autonomy and strategic flexibility for short-term tariff relief. The next phase should focus on restoring balance, clarity, and reciprocity.”
Other Important Articles Covering the same topic:
📍UPSC Issue at a Glance | India and EU seal the deal: Trade, Mobility, Security—and major takeaways
📍Why closing the deal marks a decisive break in Delhi-DC dynamic
📍Sensitive sectors safeguarded, Goyal on farm, dairy producers
Previous year UPSC Prelims Question Covering similar theme:
(5) In the context of global oil prices, “Brent crude oil” is frequently referred to in the news. What does this term imply? (UPSC CSE 2011)
1. It is a major classification of crude oil.
2. It is sourced from the North Sea.
3. It does not contain sulfur.
Which of the statements given above is/are correct?
(a) 2 only
(b) 1 and 2 only
(c) 1 and 3 only
(d) 1, 2 and 3
Previous year UPSC Mains Question Covering similar theme:
‘What introduces friction into the ties between India and the United States is that Washington is still unable to find for India a position in its global strategy, which would satisfy India’s National self-esteem and ambitions’. Explain with suitable examples. (UPSC CSE 2019)
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| PRELIMS ANSWER KEY |
| 1. (b) 2. (d) 3. (d) 4. (b) 5. (b) |
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Prime Minister Narendra Modi with the Malaysian Prime Minister Anwar Ibrahim during their joint press statement in Kuala Lumpur on February 8. Photo: X/@PMOIndia
