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#Upsc Economy
India-New Zealand FTA to Take Effect on October 20
India-NZ FTA, which is valid from October 20, is aimed at increasing bilateral trade twofold to reach ₹35,000 crore in 4-5 years. New Zealand offers duty-free access for products made in India, whereas India safeguards its sensitive industries such as dairy and agriculture.
0.4% UPI Fee on Merchant Payments Above ₹2,000
NPCI will charge a 0.4% MDR for UPI merchant transactions above ₹2,000 from 15 October, but peer-to-peer transactions and transactions below ₹2,000 will continue to be free of cost. The architecture is designed to achieve equilibrium between making UPI affordable and ensuring its sustainability. Cost-passing, merchant adoption, and rural penetration are among the challenges.
Does Inflation Targeting Work in India? Explained
Inflation Targeting, which is a decade-old framework for India (4% CPI), is facing difficulties due to a flat Phillips curve, unanchored expectations, and supply shocks. Rate increases could negatively impact growth without reducing inflation. Future actions should include monetary policies and supply-side measures, better communication, fiscal coordination, and India-specific models.
GST Revenue Grows 14.8% to Nearly ₹2 Lakh Crore in August
GST collections reached ₹1.998 lakh crore, growing by 14.8%. However, several concerns remain: domestic growth at 9.3% is lower than import growth of 29%, while refunds have increased by 72.6%. The inverted structure of the GST duties is still a concern. Moving ahead, rate rationalisation and compliance are needed.
Chandra’s settlement comes as IBC turns 10, with bank haircuts at five-year high
The bankruptcy proposal put forth by Subhash Chandra with a haircut of 99.97% has once again opened the debate on IBC. It throws light on many of the issues relating to resolution versus recovery, related-party voting, and personal guarantors.
Gross FDI hit 15-year high of $30.7 billion in April-June 2026
Gross FDI inflow into India registered a 15-year record of $30.7 billion in Q1 2026, showing an increase of 46% from the previous quarter, led by the manufacturing sector. Net FDI inflow has become positive with $1.3 billion recorded in June. Challenges are posed by large outflows, concentration of investors, and the requirement for good-quality investments.
Only 8.25% Graduates Work in Jobs Matching Qualifications: NITI Aayog
NITI Aayog stresses the existence of an acute education-to-employment gap in India, where merely 8.25% of graduates are in occupations that correspond to their education level. With outdated curricula, poor industrial-academic connections and low numbers of apprentices, India needs to adopt a curriculum linked to industries, vocational training and apprenticeship to ensure employability.
India Can Become Global Shipbuilding Hub: Rajnath Singh
India can emerge as a global shipbuilding centre owing to the decline in conventional centres, strategic autonomy, strong steel infrastructure, skilled labour force, and export prospects. Issues faced include global competition, capacity constraints, and financing. The approach needed includes clusters, PPPs, R&D, policy initiatives, and skill development, moving from import dependence to global exports.
Food Security Act Amendment May Hurt the Poorest: Explained
The NFSA amendment would change the entitlement of AAY from 35 kg per household to about 7 kg per individual, impacting smaller and weaker households more adversely. Since entitlement based on a per-capita approach would ensure formal equality, it could undermine substantive equality. Thus, reforms in this regard must consider both aspects.
Lok Sabha Passes Bill Allowing Banks to Levy Charges on UPI
The Taxation and Other Laws (Amendment) Bill 2026 would help the government tweak the zero-MDR regime applicable on the Unified Payments Interface (UPI) and RuPay without having to introduce charges immediately. The move is an attempt to bring more flexibility into the system in light of India-US trade worries.
Rajya Sabha Passes MSME Development (Amendment) Bill, 2026
The MSME Development (Amendment) Bill, 2026 encourages digitisation and invoice financing through TReDS, as part of an effort to enhance MSME liquidity and formalisation. It aims to facilitate quick payments and develop the digital economy. It will be successful based on the following factors: greater use of TReDS, implementation, digital literacy, and financial inclusion of MSMEs.