28 March 2026

• Economy: Petrol and diesel excise duty cut; Special Additional Excise Duty (SAED) reduced by ₹10 per litre.
• Economy: The rupee hit ₹94 against the US dollar.
• Polity: North-South delimitation crisis: South India fears losing 47 to 63 Lok Sabha seats post-census.
• West Asia: Transgender Persons Amendment Bill controversy continued in civil society.
• International: India assumes BRICS chairship with the September 2026 summit in Kazan-II format.
• Education: Karnataka government announced SSLC third-language policy reform.

GS area: Economy (fiscal policy, energy)

The government announced a reduction in excise duty:

• SAED reduction: Special Additional Excise Duty on petrol and diesel cut by ₹10 per litre.
• Revenue implication: The cut reduces central government revenue by approximately ₹1.5 lakh crore annually (extrapolated from fuel consumption data).
• Trigger: West Asia conflict-driven Brent crude at $108 per barrel was pushing retail fuel prices to politically sensitive levels. Retail petrol prices in metros had crossed ₹110 per litre.
• How India's excise works:
  • Retail price = crude cost + refinery margin + Central Excise + State VAT + dealer margin.
  • Central Excise has multiple layers: Basic Excise Duty (BED), Special Additional Excise Duty (SAED), and Agriculture and Infrastructure Development Cess (AIDC).
  • SAED is the component the government adjusts frequently (it is not devolved to states through the Finance Commission).
• Revenue sharing: The AIDC and SAED components are not part of the divisible pool shared with states. This is why the Centre can cut SAED without impacting state devolutions.

Static linkage: Excise duty, fiscal federalism, petroleum pricing (GS III).

GS area: Economy (monetary policy, external sector)

The Indian rupee depreciated to ₹94 per US dollar:

• Drivers of depreciation:
  • FII portfolio outflows: ₹88,000 crore withdrawn in March 2026.
  • Oil import bill surge: Current account deficit widening.
  • Dollar strengthening globally (investors seeking safe haven).
• Impact on India:
  • Import inflation: Every ₹1 depreciation adds approximately ₹12 crore per day to India's oil import cost.
  • Export competitiveness: Indian goods become cheaper for foreign buyers, benefiting textile and IT exporters.
  • External debt service: India's external debt stood at approximately $650 billion. Dollar-denominated debt becomes more expensive to service.
• RBI's response: RBI intervened in the forex market by selling dollars from its reserves. Reserves fell from $725 billion (high) to $709 billion.
• Purchasing Power Parity: PPP-adjusted growth rates show India's economy is larger than nominal GDP data suggests; a weaker rupee affects nominal comparisons but less the real economy.

Static linkage: Exchange rate, current account deficit, RBI forex intervention (GS III).

GS area: Polity (elections, federalism)

The prospective delimitation of Lok Sabha constituencies after the 2026 census became a major federalism controversy:

• The arithmetic: Lok Sabha has 543 seats. Constituencies are redrawn after each census based on population. The 84th Amendment (2002) froze delimitation until 2026.
• The problem: South Indian states (Tamil Nadu, Kerala, Andhra Pradesh, Telangana, Karnataka) have successfully reduced their fertility rates. Their populations grew slower than North Indian states (Uttar Pradesh, Bihar, Madhya Pradesh, Rajasthan).
• Projected loss: Models project South India could lose 47 to 63 Lok Sabha seats after delimitation based on population shares.
• Political implication: South Indian parties (DMK, Congress, TRS, YSRCP) lose parliamentary representation despite better development outcomes.
• Perverse incentive: Delimitation based on population rewards states that did not control population growth, penalising states that followed the two-child norm actively.
• Possible remedies discussed: A "Development Performance" criterion in delimitation; constitutional amendment to delink seat allocation from population alone; no delimitation until 2031.

Static linkage: Delimitation, federalism, 84th Amendment (GS II).

GS area: Economy (national accounts)

A study by economists including Arvind Subramanian (former CEA) gained attention:

• The claim: India's actual GDP growth rate has been overestimated by 1.5 to 2 percentage points annually in recent years.
• Methodology used in the study: Compared GDP growth with proxies (electricity consumption, satellite night lights, two-wheeler sales, rail freight). These proxies correlate with economic activity without using the national accounts estimates.
• Government's rebuttal: Ministry of Statistics argued the GVA-based GDP estimation (post-2011 base year revision) captures the services sector more accurately, which the proxies miss.
• Context: India's GDP base year was revised in 2015 from 2004-05 to 2011-12. This revision raised the base and changed sectoral weights.
• CSO (MoSPI): Central Statistics Office (now part of MoSPI: Ministry of Statistics and Programme Implementation) produces the national accounts. Its methodology follows the UN System of National Accounts 2008 guidelines.

Static linkage: GDP estimation, national accounts, CSO (GS III).

GS area: Environment, Governance (urban)

The Musi Riverfront Development Project in Hyderabad drew protest:

• Project cost: ₹6,500 to ₹7,000 crore. To develop a 55 km stretch of the Musi River.
• Displacing communities: About 1.5 lakh people living in informal settlements on the Musi's flood plains were to be displaced.
• Environmental concerns:
  • The Musi is severely polluted (receiving untreated sewage from Hyderabad). Riverfront development without sewage treatment plants would not revive the river.
  • Flood plain encroachment: The flood plains are natural buffers that the project partially converts to parks and promenades.
• Model: Inspired by Sabarmati Riverfront Development (Ahmedabad). Critics argued the Sabarmati model also displaced marginalised communities.
• EIA: The project's Environmental Impact Assessment was challenged as having inadequate public consultation.

Static linkage: Urban rivers, EIA, displacement (GS III, GS I).

GS area: International Relations

India assumed the BRICS chairship for 2026:

• Summit: September 2026, to be hosted in New Delhi.
• BRICS-Plus format: The 2023 Johannesburg summit admitted 6 new members: Saudi Arabia, UAE, Ethiopia, Iran, Egypt, Argentina (though Argentina later declined). The group's expansion continued with 3 more members in 2024.
• India's priorities as chair:
  • Multilateral development bank reform (expanding New Development Bank lending).
  • Digital public infrastructure (UPI, digital ID) as a BRICS priority.
  • Food security in the context of West Asian conflict's impact on food supply chains.
• NDB (New Development Bank): BRICS' multilateral bank headquartered in Shanghai. Total capital: $100 billion. India is a co-founder.
• India-China in BRICS: BRICS requires India to work constructively with China despite Galwan-era friction. India navigates this by focusing on functional economic areas rather than political alignment.

Static linkage: BRICS, NDB, multilateralism (GS II).