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19 December 2025

SC Tells EC Feed Fround Facts | India-Oman Pact Boosts Trade | SC Okays Kolhapur HC Bench | Rural Lifetimes And Directives | Bold Step for Nuclear Goals | Temporary Relief | FM tables Securities Code Bill | MGNREGA: Ground Slipping Away | Delhi Air Needs Local Plan | RBI Shoring Rupee? Let It Be

SC TELLS EC HEED GROUND FACTS

 

KEY HIGHLIGHTS

Context of the News

  • The Supreme Court asked the Election Commission of India (ECI) to take a “sympathetic view” on requests to extend the enumeration phase of the Special Intensive Revision (SIR) of electoral rolls.
  • Petitioners from Uttar Pradesh and Kerala argued that even revised timelines were too short and risked exclusion of genuine voters.
  • Revised timelines:
    • Kerala: Enumeration till 18 December; draft roll on 23 December.
    • Uttar Pradesh: Enumeration extended till 26 December.
  • The Court did not issue mandatory directions, respecting ECI’s autonomy.
  • The constitutional validity of SIR will be heard on 6 January 2026.

Key Points

  • SIR: A non-routine, intensive exercise to verify and update electoral rolls beyond annual summary revision.
  • Petitioners’ concern:
    • No urgency as UP Assembly elections are due in 2027.
    • Possibility of large-scale voter exclusion (claimed ~25 lakh in Kerala).
  • ECI’s stand:
    • Extensions already granted based on feedback.
    • Judicially imposed deadlines may undermine constitutional independence.
    • SC declined to examine issues related to data sharing with volunteers at this stage.

Static Linkages

  • Article 324: ECI’s plenary powers over elections (subject to law made by Parliament).
  • Representation of the People Act, 1950:
  • Governs preparation and revision of electoral rolls.
  • Provides for intensive and special revisions.
  • Universal Adult Franchise (NCERT Polity):
  • Requires inclusion, accuracy, and fairness in voter lists.

Critical Analysis

  • Advantages
    • Improves credibility and purity of electoral rolls.
    • Removes duplicates, deceased, and ineligible voters.
    • SC’s restraint preserves separation of powers.
  • Concerns
    • Short timelines may violate the substantive right to vote.
    • Risk of procedural arbitrariness and wrongful deletions.
    • Data handling by volunteers raises privacy and trust issues.

Way Forward

  • Follow state-specific timelines based on population and migration.
  • Strengthen appeal and correction mechanisms during SIR.
  • Ensure trained enumerators and clear data- protection protocols.
  • Increase voter awareness drives before intensive revisions.

INDIA-OMAN PACTS BOOSTS TRADE

KEY HIGHLIGHTS

What is the News?

  • India and Oman signed a Comprehensive Economic Partnership Agreement (CEPA) in 2025.
  • It aims to deepen trade, services, investment and labour mobility.
  • It is India’s 2nd CEPA in the GCC (after UAE, 2022).
  • Oman’s first bilateral trade agreement since 2006 (US–Oman FTA).

Key Trade Commitments

  • Oman → India
    • Duty-free access on 98.08% tariff lines  
    • Covers 99.38% of India’s exports
  • India → Oman
    • Liberalised tariffs on 77.79% tariff lines  
    • Covers 94.81% of imports from Oman
  • Trade Data (2024–25)
    • India’s exports to Oman: $4.06 billion
    • India’s imports from Oman: $6.5 billion
    • Oman accounts for ~1% of India’s total trade

Sectoral Impact

  • Full tariff elimination for Indian exports in:
    • Gems & jewellery
    • Textiles, leather, footwear
    • Engineering goods, automobiles
    •  Pharmaceuticals & medical devices
    • Plastics, furniture, agricultural products
  • Sensitive sectors excluded by India:
    • Dairy, tea, coffee, rubber, tobacco  
    • Gold & silver bullion, jewellery
    • Footwear, sports goods, metal scrap

Services & Labour Mobility

  • Major highlight: Mode 4 commitments (movement of professionals)
  • Intra-Corporate Transferees quota increased from 20% to 50%
  • Contractual Service Suppliers stay extended:
    • 90 days → 2 years (+ 2-year extension)
  • Liberalised entry for skilled professionals in key sectors

Strategic Significance

  • Strengthens India’s engagement with West Asia & GCC
  • Acts as a gateway to GCC, Africa, Central Asia & Eastern Europe
  • Supports India’s export diversification strategy  Enhances India’s role in regional value chains

Static Concept Linkage

  • FTAs/CEPAs → Preferential trade under WTO rules
  • Services trade → GATS Modes of Supply  Trade creation vs trade diversion
  • Economic diplomacy as foreign policy tool

Critical Analysis

  • Positives
    • Near-complete market access for Indian exports
    • Boost to labour-intensive manufacturing
    • Strong services and mobility commitments  
    • Enhances India’s economic footprint in Gulf
  • Concerns
    • Persistent trade deficit with Oman
    • Implementation challenges in services mobility  
    • Limited gains if MSMEs fail to integrate
    • Exposure to external economic shocks

Way Forward

  • Effective implementation and dispute- resolution mechanisms
  • MSME onboarding and export facilitation  
  • Mutual recognition of qualifications
  • Use CEPA as a template for India–GCC FTA  
  • Strengthen logistics and trade facilitation

SC OKAYS KOLHAPUR HC BENCH

KEY HIGHLIGHTS
Context of the News
  • The Supreme Court (Justices Aravind Kumar and N.V. Anjaria) dismissed a petition challenging the establishment of a Circuit Bench of the Bombay High Court at Kolhapur.
  • The Bench upheld the decision as consistent with the constitutional vision of bringing justice closer to the people.
  • The Circuit Bench was notified on August 1 under Section 51(3) of the States Reorganisation Act, 1956.

Key Facts

  • Legal basis: Section 51(3), States Reorganisation Act, 1956.
  • Authority: Chief Justice of the High Court, with Governor’s approval, can appoint additional places of sitting.
  • Challenge: Petition alleged violation of Article 14 (arbitrariness and discrimination), citing demands from other regions like Pune and Solapur.
  • Supreme Court ruling:
    • No constitutional requirement to satisfy all regional demands simultaneously.
    • Article 14 does not mandate absolute uniformity in administrative decisions.
    • Differential treatment is valid if based on objective criteria.
  • Rationale for Kolhapur:
    • Serves contiguous districts.
    • Located at a substantial distance from the principal seat.
    • Chosen after assessing accessibility, feasibility, litigation needs, and institutional capacity.
    • Finding: No evidence of mala fides or extraneous considerations.

Static Constitutional & Legal Linkages

  • Article 214: High Courts for States. Article 225: Jurisdiction and powers of High Courts.
  • Article 14: Equality before law → allows reasonable classification, not mechanical equality.
  • Article 21: Access to justice as part of the right to life (Hussainara Khatoon case).
  • States Reorganisation Act, 1956 – Section 51(3):
    • Enables decentralised judicial sittings within a State.
  • Doctrine of Reasonable Classification:
    • Intelligible differentia
    • Rational nexus with objective (here: access to justice).

Constitutional Significance

  • Reinforces judicial decentralisation without constitutional amendment.
  • Balances institutional autonomy with citizen- centric justice delivery.
  • Clarifies limits of Article 14 in administrative and judicial governance.
  • Aligns with transformative constitutionalism focusing on substantive access, not formal equality.

Critical Analysis

  • Pros
    • Improves access to justice for remote regions.
    • Reduces cost, delay, and travel burden for litigants.
    • Decongests principal High Court seat.
  • Concerns
    • Possibility of competitive regional demands.
    • Requires adequate judicial manpower and infrastructure to avoid dilution.

Way Forward

  • Frame objective, transparent criteria for future circuit benches.
  • Periodic review based on pendency, accessibility, and performance.
  • Complement physical benches with e-courts and digital access.
  • Strengthen judge strength and infrastructure as recommended by Law Commission and Economic Survey.
RURAL LIFETIME AND  DIRECTIVES
KEY HIGHLIGHTS
Context of the News
  • Parliament has introduced the Viksit Bharat – Guarantee for Rozgar and Ajeevika Mission (Gramin) Bill, 2025 to replace MGNREGA, 2005.
  • The Bill proposes a structural shift from a rights-based, demand-driven employment guarantee to a centrally controlled, allocation- based framework.
  • The move has raised concerns regarding constitutional values, federalism, decentralisation, and social justice.

Key Points

  • MGNREGA provides a legal guarantee of 100 days of wage employment to rural households.
  • Employment is universal, voluntary, and demand-driven.
  • Entire wage cost is borne by the Union government; States share limited costs.
  • The new Bill:
    • Replaces demand-driven employment with normative financial allocations.
    • Removes the legal obligation of the Centre to provide work beyond allocated funds.
    • Increases State governments’ financial burden to ~40%.
    • Centralises project design, audits, and monitoring.
    • Prohibits employment during peak agricultural seasons.
    • Makes Aadhaar linkage and digital attendance mandatory.
  • In 2024–25, ~8.9 crore workers demanded work, but ~1 crore were denied.
  • Average employment remains below 50 days, despite statutory entitlement.
  • Rural employment spending has stayed below 0.2% of GDP

Static Linkages

  • State obligation towards livelihood security.
  • Directive Principles as instruments of economic democracy.
  • Federal distribution of fiscal and administrative powers.
  • Decentralised governance through local institutions.
  • Equality in wages and access to work.
  • Social justice for historically marginalised groups.

Critical Analysis

  • Concerns
    • Dilutes the right to work by removing legal enforceability
    • Converts welfare from entitlement-based to budget-limited assistance.
    • Greater fiscal stress on States undermines cooperative federalism.
    • Centralisation weakens Panchayati Raj Institutions.
    • Seasonal work ban reduces workers’ bargaining power, especially women.
    • Digital conditions risk exclusion due to connectivity and authentication failures.
    • Disproportionate impact on SCs, STs, and women, who form the majority of beneficiaries.
  • Possible Rationale
    • Fiscal predictability for the Centre.
    • Greater monitoring through digitisation.
    • Alignment with broader livelihood missions.

Way Forward

  • Refer the Bill to a Parliamentary Standing Committee.
  • Retain the demand-driven, rights-based core of rural employment.
  • Ensure adequate, need-based funding, indexed to rural distress.
  • Strengthen Panchayat autonomy in planning and execution.
  • Use digital tools as enablers, not eligibility barriers.
  • Integrate employment support with skill development and livelihood diversification.

BOLD STEP FOR NUCLEAR GOALS

KEY HIGHLIGHTS

Context of the News

  • Parliament passed the SHANTI Bill, 2025 to enable large-scale expansion of nuclear energy.
  • It consolidates provisions of the Atomic Energy Act, 1962 and Civil Liability for Nuclear Damage Act, 2010.
  • Objective: support high human development, energy security, and decarbonisation.
  • India targets 100 GW nuclear capacity by mid- century pasted

Key Points

  • HDI rises with per capita energy consumption (income, health, education).
  • To reach HDI ~0.9, India may need ~24,000 TWh/year energy generation.
  • Current electricity generation (2023–24): ~1,950 TWh.
  • Electricity share in Final Energy Consumption:~22% → needs major rise.
  • Solar & wind:
    • Intermittent
    • Storage-intensive  
    • Land-constrained
  • Nuclear power:
    • Low-carbon
    • 24×7 baseload
    • Essential for industry & green hydrogen  
  • India’s strengths:
    • Indigenous 700 MW PHWRs
    • Fuel fabrication, heavy water, waste reprocessing
  • SHANTI Bill:
    • Statutory recognition to nuclear regulator  Primary safety & liability on licensee

Static Linkages

  • Energy–development relationship  
  • Baseload vs intermittent power
  • Three-stage nuclear programme  
  • Polluter pays principle
  • Independent regulation in high-risk sectors
  •  Sustainable development

Critical Analysis

  • Pros
    • Reliable baseload decarbonised power
    • Supports heavy industry & hydrogen economy  
    • Reduces fossil fuel dependence
    • Builds on indigenous capability
  • Concerns
    • High capital cost & long gestation  
    • Uranium import dependence
    • Safety perception & regulatory strength

Way Forward

  • Nuclear–renewable balanced energy mix  
  • Strengthen regulator autonomy
  • Invest in advanced reactors & waste handling
  • Improve public risk communication
  • Secure uranium through diplomacy
TEMPORARY RELIEF

KEY HIGHLIGHTS

Context of the News

  • Merchandise exports grew 19.4% to $38.1 bn (Nov 2025) – highest November in 10 years.
  • Exports to U.S. rose 22.6% to $6.98 bn despite 50% U.S. tariffs.
  • Merchandise imports fell 1.9% to $62.7 bn, narrowing trade deficit.
  • Export growth driven by tariff absorption, not competitiveness.
  • Order slowdown expected from January; sustainability at risk.

Key Points

  • Exporters absorbing tariffs to retain markets – short-term strategy.
  • MSMEs dominate U.S.-bound exports → limited capacity to bear losses.
  • Rupee depreciation offers partial, temporary relief.
  • Import contraction signals weak domestic demand, not strength.
  • Export Promotion Mission announced, schemes not yet notified.

Static Linkages

  • Trade balance as a determinant of Current Account Deficit (CAD).
  • Limited effectiveness of exchange rate depreciation under high tariff regimes.
  • MSMEs as key drivers of employment-intensive export growth.
  • Relationship between import contraction and aggregate demand slowdown.
  • WTO principles on tariff barriers and trade distortions.

Why Export Growth Is Misleading

  • The export surge reflects price sacrifice, not productivity or competitiveness gains.
  • Exporters absorbing tariffs leads to:  
    • Margin erosion
    • Liquidity stress
    • Reduced reinvestment capacity
  • Such growth cannot be sustained once balance sheets weaken.

Import Decline: Why It Is a Red Flag

  • India remains import-dependent for:  
    • Capital goods
    • Intermediate inputs  
    • Energy resources
  • Import contraction suggests:
    • Slackening domestic consumption and investment demand
    • Possible post-GST rate cut demand weakness  
  • Unlike export growth, import decline does not automatically signal economic strength.

Stakeholder-wise Impact

  • Exporters: Credit stress, shrinking margins, order uncertainty.
  • Workers: Risk of layoffs in labour-intensive MSME sectors.
  • Government: Pressure on fiscal resources and trade diplomacy.
  • Economy: Risk of export slowdown feeding into GDP growth.

Policy Evaluation

  • What the Government Is Doing
    • Announced Export Promotion Mission.  
    • Considering loan moratoriums.
  • Gaps
    • Delay in notifying schemes.
    • Moratorium helps cash flow but does not improve credit access.
    • No targeted mechanism for tariff-affected exporters yet.

Way Forward

  • Operationalise Export Promotion Mission immediately with sector-specific support.
  • Introduce export-focused credit guarantee scheme (on the lines of ECLGS).
  • Target support to MSMEs in labour-intensive export sectors.  
  • Diversify export markets to reduce U.S. concentration risk.
  • Strengthen trade diplomacy and dispute resolution mechanisms.
  • Reduce structural export costs via logistics, GST rationalisation and compliance simplification.

FM TABLES SECURITIES CODE BILL

KEY HIGHLIGHTS

Context of the News

  • Securities Market Code Bill, 2025 tabled in Lok Sabha by the Finance Minister.
  • Referred to the Standing Committee on Finance.
  • Proposal announced earlier in Union Budget 2021–22.

Purpose of the Bill

  • To consolidate multiple securities market laws into a single code.
  • To simplify regulation and remove overlaps.
  • To strengthen investor protection and capital market efficiency.
  • Laws Proposed to be Merged
    • Securities Contracts (Regulation) Act, 1956  
    • SEBI Act, 1992
    • Depositories Act, 1996

Major Provisions

  • SEBI Board Restructuring
  • Board strength increased from 9 to 15 members.
  • Composition includes :
    • Chairperson
    • 2 Central Government nominees  
    • 1 RBI nominee
    • 11 other members
  • Minimum number of whole-time members raised to 5.
  • Decriminalisation of Offences
    • Minor, procedural and technical violations shifted to civil penalties.
    • Objective is to reduce compliance burden and improve ease of doing business.
    • Retention of Criminal Punishment
    • Serious market offences such as insider trading and market manipulation remain criminally punishable.
  • Civil Penalty Framework
    • Unlawful gains or losses to be dealt with through monetary penalties.
    • Focus on faster adjudication rather than imprisonment.
  • Limitation on Inspection
    • No inspection can be initiated after 8 years from the date of violation.
  • Conflict of Interest Measures
    • SEBI members must disclose direct or indirect interests before decision-making.
  • Concerns and Criticism
    • Opposition expressed concern over concentration of powers in SEBI.
    • Questions raised on separation of powers and regulatory accountability.

Static Linkages for Answers

  • Role of independent regulators in a liberalised economy.
  • Quasi-judicial bodies and delegated legislation.   
  • Principles of natural justice and transparency.  
  • Post-1991 financial sector reforms.
  • Advantages
    • Simplifies securities regulation.  
    • Reduces litigation and delays.
    • Improves investor confidence.
    • Aligns with international regulatory practices.
  • Challenges
    • Risk of excessive regulatory centralisation.
    • Effectiveness of civil penalties as deterrence.
    • Time limit may restrict investigation of complex frauds.

Way Forward

  • Strong parliamentary and judicial oversight.
  • Clear distinction between minor and serious offences.
  • Periodic review of regulatory framework.

MGNREGA: GROUND SLIPPING AWAY

KEY HIGHLIGHTS
Context of the News
  • The VB-G RAM G Bill proposes replacing MGNREGA, altering its core design and governance.
  • The Bill shifts focus from a demand-driven legal entitlement to a more centralised, supply-driven framework.
  • This has triggered debate on employment guarantees, decentralisation, and federal balance.
  • Evidence from academic studies and crisis periods (COVID-19) highlights MGNREGA’s systemic role beyond welfare pasted

Key Points

  • MGNREGA guarantees employment on demand through a self-targeting mechanism.
  • Empirical outcomes:
    • ~14% rise in household earnings.  
    • ~26% reduction in rural poverty.
    • No evidence of employment loss despite higher wages.
  • Strengthened labour bargaining power and rural demand.
  • Women account for 57%+ of employment days nationally (up to ~80% in some states).
  • Acted as an employer of last resort during COVID-19.
  • VB-G RAM G Bill:
    • Proposes 125 days of work (nominal).
    • Moves towards budget-capped, centrally guided allocation.
    • Increases State fiscal responsibility.

Static Linkages

  • Employment guarantees as instruments of inclusive growth.
  • Self-selection preferred over targeting in informal economies.
  • Wage floors can correct labour market distortions.
  • Decentralisation improves accountability.
  • Counter-cyclical public spending stabilises demand.

Critical Analysis

  • Merits of MGNREGA
    • Legal entitlement ensures accountability.
    • Self-targeting limits exclusion and manipulation.
    • Major boost to women’s labour participation.  
    • Macroeconomic stabiliser in crises.
    • Empowers Panchayati Raj Institutions.
  • Issues with VB-G RAM G Bill
    • Dilutes demand-driven guarantee.
    • Centralised planning weakens local autonomy.  
    • Seasonal pauses reduce effective workdays.
    • Wage concerns ignore positive spillovers.
    • Fiscal burden on States may widen regional disparities.

Way Forward

  • Retain legal, demand-driven employment guarantee.
  • Improve wage timeliness and asset quality.
  • Use scheme as a counter-cyclical safety net.  
  • Strengthen Panchayat autonomy.
  • Reform incrementally using evidence, not dilution.
DELHI AIR NEEDS LOCAL PLAN

KEY HIGHLIGHTS

Context of the News

  • Parliamentary replies (Nov 29, 2021; July 18, 2022) and CPCB data show COVID lockdowns failed to ensure clean air in Delhi.
  • 2020 (lockdown year): 49 Very Poor, 15 Severe AQI days.
  • 2021 (economic revival): 41 Very Poor, 12 Severe days → pollution declined despite higher activity.
  • Indicates meteorology + geography > short- term emission curbs.

Key Points

  • Lockdowns disproved emission-only theory of air pollution control.
  • Indo-Gangetic plains: low wind speed, temperature inversion, low mixing height.
  • Meteorology dominates AQI outcomes (CPCB, IMD studies).
  • GRAP is reactive, often implemented after thresholds are crossed.
  • Delhi functions as an airshed pollution reservoir, not an isolated city.

Static Linkages

  • Right to clean environment under Article 21.
  • Pollution as a negative externality requiring state intervention.
  • Airshed approach recognised under NCAP.
  • Prevention principle preferred over ex-post regulation.
  • Environmental governance needs cooperative federalism.

Critical Analysis

  • Pros
    • Better real-time AQI monitoring.
    • Judicial and policy attention to clean air.
  • Cons
    • Over-reliance on emergency measures.  
    • Weak use of weather-based prediction.  
    • Fragmented NCR governance.
    • Health and livelihood losses due to delayed action.

Way Forward

  • Shift from reactive to predictive GRAP.
  • Integrate weather forecasting + AI models.  
  • Implement airshed-level authority for NCR.
  • Ensure reliable power to end diesel generator use.
  • Dust-proof roads, green vacant land, cap landfills.
  • Promote citizen participation through transparency.
  • Adjust work hours to align with better mixing periods.

RBI SHORING RUPEE? LET IT BE

KEY HIGHLIGHTS

Context of the News

  • Rupee recorded its best single-day gain in 7 months after RBI intervention.
  • RBI sold dollars in the forex market.
  • Exchange rate appreciated from ₹91.05/$ to ₹90.09/$ (~0.7% by close; >1% intraday).
  • Rupee had depreciated >6% in one year, 2–3× faster than historical trend.
  • Sharp fall of ~3% in 10 days since mid- November triggered concerns of excessive volatility.
  • RBI reiterated market-determined exchange rate; intervention only to curb abnormal volatility.

Key Points

  • Dollar sales increase dollar supply, strengthening the rupee.
  • RBI does not target any exchange rate level or band.
  • Rapid depreciation risks panic and self- fulfilling expectations.
  • Low domestic inflation and subdued crude prices reduce inflationary risks of depreciation.
  • Long-term rupee value depends on exports, imports, and capital flows, not intervention.

Static Linkages

  • Managed floating exchange rate regime.  Forex demand–supply mechanism.
  • Balance of Payments dynamics.  Inflation pass-through.
  • Forex reserves as buffer.  Impossible Trinity.

Critical Analysis

  • Pros
    • Prevents disorderly markets.  
    • Anchors investor confidence.  
    • Limits short-term volatility.
  • Cons
    • Cannot alter fundamentals.
    • Prolonged use may erode reserves.  
    • May distort price discovery.

Way Forward

  • Allow fundamentals-based adjustment of the rupee.
  • Use intervention only for volatility smoothing.
  • Boost exports through competitiveness, not currency support.
  • Prefer stable FDI inflows.
  • Maintain reserves as insurance, not target.