INTEGRATED MAINS AND PRELIMS MENTORSHIP (IMPM) 2025 Daily KEY
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Retail Inflation and Carbon Border Adjustment Mechanism (CBAM) its significance for the UPSC Exam? Why are topics like Stubble burning, Sixth Schedule of the Indian Constitution , Green hydrogen technologies important for both preliminary and main exams? Discover more insights in the UPSC Exam Notes for November 14, 2025 |
Retail inflation hits a historic low of 0.25% in October
For Preliminary Examination: Current events of national and international Significance
For Mains Examination: GS III - Economy
Context:
Retail inflation fell to a historic low of 0.25% in October, with the government attributing this fall to the first full month’s impact of GST rate cuts, a favourable base effect, and drop in inflation of several food items such as vegetables and fruits.
Read about:
What is Retail Inflation?
Goods and Service Tax
Key takeaways:
- Retail inflation refers to the rise in the prices that consumers pay for everyday goods and services—such as food, clothing, fuel, transport, and household items—over a period of time. It reflects how much more expensive life becomes for an average household.
- In India, retail inflation is measured using the Consumer Price Index (CPI), which tracks changes in the cost of a fixed basket of goods typically purchased by consumers.
- When retail inflation increases, it means that the purchasing power of money decreases, as people must spend more to buy the same items they used to afford earlier.
- This form of inflation is particularly important because it directly affects living standards. For instance, a rise in the price of essential commodities like vegetables, cereals, or cooking gas immediately impacts household budgets, especially for lower- and middle-income groups.
- It also influences economic decision-making at various levels. The Reserve Bank of India closely monitors retail inflation to decide monetary policies such as interest rates. If inflation rises beyond the RBI’s comfort zone, the central bank may raise interest rates to control spending and stabilize prices.
- Conversely, when inflation is low, it may lower rates to encourage borrowing and boost economic activity.
Additional Information
- Retail inflation dropped to an unprecedented 0.25% in October, a decline the government credits to the full-month impact of GST rate reductions, a favourable base effect, and lower price increases in several food items like fruits and vegetables.
- The government noted that this is the lowest inflation rate recorded in the current Consumer Price Index series, which began in January 2012. The data indicate that much of the decline in overall inflation stems from the statistical influence of the base effect on food prices.
- Figures show that the food and beverages segment registered a 3.7% fall in prices in October 2025, deepening the 1.4% drop seen in September. Economists, however, point out that this decline is largely due to the high inflation of 9.7% in the same month last year, making the current year’s figures appear more favourable rather than reflecting a true reduction in prices.
- In contrast, inflation in the housing sector rose slightly to 3% in October 2025, up from 2.8% in October 2024.
- Among other groups, clothing and footwear experienced a slowdown in price rise, easing to 1.7% compared to 2.7% last year, likely influenced by GST cuts. Meanwhile, inflation in the pan, tobacco, and intoxicants group edged up to 2.9% from 2.5% a year earlier.
- The miscellaneous category—which covers items outside the main sectors—saw inflation pick up significantly, rising to 5.7% in October 2025 from 4.3% in the same month the previous year
Follow Up Question
Mains
1.The recent decline in retail inflation to a historic low has been attributed largely to the statistical base effect rather than a genuine reduction in prices. In this context, critically examine the role of base effects in shaping inflation trends in India. Discuss how sector-specific variations—such as food, housing, and miscellaneous categories—complicate the interpretation of headline inflation
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Note: This is a refrence approach to the Question and Model Answer Only
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- Bank rate
- Open Market Operations
- Public debt
- Public revenue
Which of the above is/are component(s) of Monetary Policy?
(a) 1 only
(b) 2, 3 and 4
(c) 1 and 2
(d) 1, 3 and 4
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Answer (c)
Monetary policy refers to tools used by the RBI to regulate money supply and credit in the economy.
Hence, only 1 and 2 are components of monetary policy |
Indian iron and steel exporters face the highest CBAM levy
For Preliminary Examination: Current events of national and international Significance
For Mains Examination: GS III - Environment and Ecology
Context:
Indian exporters of iron and steel to EU may have to pay about €301 million (approximately ₹3,000 crore) in Carbon Border Adjustment Mechanism (CBAM) fees, the highest among all countries exporting similar products to the EU, an analysis by European non-profit think-tank Sandberg has found
Read about:
Carbon Border Adjustment Mechanism (CBAM)
Greenhouse gas (GHG) emissions
Key takeaways
- The Carbon Border Adjustment Mechanism (CBAM) is a policy tool introduced by the European Union (EU) to address the issue of “carbon leakage” — a situation where industries shift production to countries with weaker climate regulations to avoid the costs of reducing greenhouse gas emissions.
- Essentially, CBAM ensures that imported goods into the EU face a carbon price equivalent to what EU producers pay under the EU’s Emissions Trading System (ETS).
- Under the EU’s climate policies, industries within the region are required to purchase carbon credits for every tonne of carbon dioxide they emit. This system creates a financial incentive to adopt cleaner technologies and reduce emissions.
- However, if foreign producers exporting to the EU are not subject to similar carbon pricing in their home countries, they gain a cost advantage. The CBAM aims to neutralize this imbalance by imposing a carbon tariff on such imports.
- The mechanism initially covers carbon-intensive sectors such as iron and steel, cement, aluminum, fertilizers, electricity, and hydrogen—areas that are both energy-intensive and highly traded globally. Importers in the EU will need to report the embedded emissions of their products and purchase corresponding CBAM certificates to cover these emissions. The price of these certificates will mirror the price of carbon within the EU’s ETS.
- For developing countries, including India, CBAM raises significant concerns. It could act as a trade barrier by making exports to the EU more expensive if domestic producers cannot demonstrate low carbon footprints. This may also pressure developing economies to adopt stricter climate measures and carbon accounting mechanisms to maintain export competitiveness.
- In essence, the CBAM represents a major step in linking global trade with climate policy. While it supports the EU’s goal of achieving net-zero emissions by 2050, it also introduces new dynamics in international trade, prompting debates on climate justice, fairness, and the responsibilities of developed versus developing nations in combating global warming
Additional Information
- According to a recent analysis by the European think tank Sandberg, Indian exporters of iron and steel to the European Union (EU) may incur approximately €301 million (about ₹3,000 crore) in charges under the Carbon Border Adjustment Mechanism (CBAM)—the highest liability among all nations exporting similar products to the bloc.
- The CBAM functions as a carbon levy imposed on European importers who purchase goods from countries where production generates higher carbon emissions per tonne than comparable goods produced within the EU.
- Sandberg’s newly released online calculator estimates that Russia will face the second-highest CBAM costs at €240 million, followed by Ukraine (€198 million) and China (€194 million).
- The study further reveals that when India’s exports of aluminium and cement are included alongside iron and steel, its total CBAM liability amounts to around €330 million, equivalent to roughly 1.05% of the value of all traded goods.
- However, it also highlights a potential opportunity — Indian industries could increase revenues by about €510 million if they adopt cleaner and more energy-efficient technologies, thereby offsetting nearly €180 million in net costs.
- India has, however, consistently voiced opposition to the CBAM, with several industry associations labelling it a form of “non-tariff barrier” that could adversely affect the competitiveness of Indian exports in European markets
Follow Up Question
Mains
1.“The European Union’s Carbon Border Adjustment Mechanism (CBAM) represents a new intersection between climate policy and international trade.”
Critically examine the implications of CBAM for India’s exports and its alignment with the principles of climate justice and the WTO framework. Suggest measures India can adopt to mitigate its economic and environmental impact.
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Note: This is just a model answer and a Model Structure model
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1.Which of the following adopted a law on data protection and privacy for its citizens known as ‘General Data Protection Regulation’ in April, 2016 and started implementation of it from 25th May, 2018? (UPSC CSE 2019)
(a) Australia
(b) Canada
(c) The European Union
(d) The United States of America
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Answer (c)
The General Data Protection Regulation (GDPR) is a comprehensive data protection law adopted by the European Union (EU) in April 2016, and it came into effect on 25th May 2018. It establishes strict rules on how personal data of EU citizens can be collected, processed, stored, and transferred — both within the EU and by entities outside it that handle EU residents’ data. The GDPR gives individuals greater control over their personal information through rights such as:
It also mandates organizations to obtain explicit consent for data processing and to report data breaches promptly. The regulation has become a global benchmark for privacy and data protection laws, influencing similar frameworks in several countries, including India’s Digital Personal Data Protection Act, 2023 |
Is Punjab’s stubble burning problem really declining?
For Preliminary Examination: Current events of national and international Significance
For Mains Examination: GS III - Environment and Ecology
Context:
Paddy harvesting has picked up momentum in Punjab, the country’s key grain-producing State, and so have stubble burning incidents. This year, stubble burning has been relatively fewer because the State faced one of its worst floods in decades, leaving vast stretches of farmland inundated
Read about:
What is Stubble burning?
Are stubble burning incidents declining?
Key takeaways:
- The harvesting of paddy has gained pace in Punjab, one of India’s major grain-producing States, and with it, the annual problem of stubble burning has reappeared. However, the number of farm fires this year has been comparatively lower.
- This decline is largely attributed to the severe floods that struck Punjab earlier in the year, submerging large tracts of farmland and delaying agricultural operations.
- Every year, as autumn approaches, the burning of paddy residue becomes a major environmental concern, contributing significantly to the deterioration of air quality across northern India, including the National Capital Region (NCR).
- Paddy harvested with combine harvesters leaves short stalks on the field, and farmers often find it most convenient to burn these remains to quickly prepare the soil for wheat sowing, which must begin within a narrow window of about three weeks.
- This short turnaround period, combined with the cost and labour involved in alternative disposal methods, drives many farmers toward this practice.
- Both the Central and State governments have claimed success in reducing the frequency of stubble burning through stricter monitoring, awareness campaigns, and by providing subsidised residue management equipment.
- Official satellite-based data from the Punjab government indicates a 70% fall in reported fire incidents in 2024 — from 36,663 cases in 2023 to 10,909 cases this year.
- Yet, despite this apparent progress, the total area affected by burning has shown little change. Data from the Punjab Remote Sensing Centre (PRSC) and the Punjab Pollution Control Board (PPCB) reveal that around 19.17 lakh hectares of farmland were affected by residue burning in 2024, almost the same as the 19.14 lakh hectares recorded the previous year.
- Earlier figures show that around 15.4–15.6 lakh hectares were affected in 2021–2022, indicating a gradual expansion over time.
- Experts caution that while the number of fire events detected has declined, the actual burnt area may have increased due to several factors. Satellite sensors often miss small, low-intensity, or short-duration fires, particularly those occurring in fragmented farmlands.
- Since satellites such as MODIS and VIIRS pass over Punjab only a few times a day, and most fires are lit in the late afternoon or evening, many are not captured. Additionally, haze, smoke, and cloud cover can obscure active fires, leading to underreporting.
- A recent study by the Indian Institute of Science Education and Research (IISER), Mohali, published in Science of the Total Environment, underscores these limitations. It also notes that some farmers, aware of satellite monitoring, may attempt to conceal burnt fields before the next satellite pass.
What is Stubble Burning?
- Stubble burning is the practice of setting fire to crop residue — the dry stalks, roots, and leaves left behind in the field after harvesting — primarily to clear the land quickly for the next planting season.
- In India, this practice is most common in Punjab, Haryana, and parts of western Uttar Pradesh, where paddy (rice) is grown during the kharif season and followed immediately by wheat cultivation in the rabi season.
- Because the time gap between harvesting paddy (usually in October) and sowing wheat (by mid-November) is short — roughly two to three weeks — farmers often find burning the leftover straw to be the fastest and cheapest way to prepare their fields.
- Modern combine harvesters, while efficient at harvesting paddy, leave behind stubble that is too short for mechanical collection and too tough for cattle feed.
- Removing or managing it mechanically requires expensive equipment and additional labour, which many small and marginal farmers cannot afford. As a result, burning becomes the most convenient option.
- However, this method has serious environmental and health consequences. It releases large amounts of particulate matter (PM2.5 and PM10), carbon monoxide (CO), nitrous oxide (Nâ‚‚O), and volatile organic compounds, which contribute to air pollution and smog, especially in northern India. The practice also depletes soil nutrients, reduces microbial activity, and damages soil health over time.
- Thus, while stubble burning offers short-term convenience, it leads to long-term environmental degradation, public health hazards, and climate challenges, making it a major policy concern in India’s agricultural and environmental governance
Follow Up Question
Q. “Stubble burning reflects the intersection of environmental neglect, agrarian distress, and policy gaps.”
Examine the causes and consequences of stubble burning in India and suggest sustainable alternatives to address this issue.
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Note: This is a reference Structure answer and Model answer only
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Prelims
1.Acid rain is caused by the pollution of the environment (UPSC 2013, 2022)
(a) Carbon Dioxide and Nitrogen
(b) Carbon Monoxide and Carbon Dioxide
(c) Ozone and Carbon Dioxide
(d) Nitrous Oxide and Sulphur Dioxide
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Answer (d)
Acid rain occurs when pollutants such as Sulphur Dioxide (SOâ‚‚) and Nitrogen Oxides (NOâ‚“) are released into the atmosphere—mainly from the burning of fossil fuels in industries, vehicles, and power plants. These gases react with water vapour, oxygen, and other chemicals in the atmosphere to form sulphuric acid (Hâ‚‚SOâ‚„) and nitric acid (HNO₃). These acids then mix with rainwater, lowering its pH, and fall as acid rain Impact:
Remember — Acid rain = SOâ‚‚ + NOâ‚“ → Hâ‚‚SOâ‚„ + HNO₃ (acidic compounds)
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- The Sixth Schedule of the Indian Constitution provides a framework for the governance of tribal areas in the northeastern states of Assam, Meghalaya, Tripura, and Mizoram. Inclusion of Ladakh under this Schedule would enable the creation of Autonomous District Councils (ADCs) and Autonomous Regional Councils (ARCs), which are elected bodies with authority over tribal areas.
- These councils would have legislative powers over various subjects such as forestry, agriculture, village and town administration, inheritance, marriage, divorce, and social customs.
- The Schedule also empowers ADCs and ARCs to collect land revenue, impose taxes, regulate money lending and trade, levy royalties from mineral leases or licenses, and develop public infrastructure like schools, markets, and roads.
- In 2019, the National Commission for Scheduled Tribes recommended that Ladakh be brought under the Sixth Schedule, citing several reasons: the region has a tribal population exceeding 97%, there are restrictions on land acquisition by outsiders, and Ladakh possesses a distinct cultural heritage that needs protection.
- Following violent incidents linked to these demands, climate activist Sonam Wangchuk, who had been on a 35-day hunger strike, ended his fast. The Leh administration imposed restrictions on gatherings of four or more people as a precaution.
- The unrest occurred ahead of scheduled talks between the Centre and the Leh Apex Body on October 6, after a four-month hiatus. Government sources indicated that Wangchuk was seen as a potential obstacle to the negotiations.
- The roots of the issue go back to 2019, when the repeal of Article 370 and the Jammu and Kashmir Reorganisation Act led to the bifurcation of the state into two Union Territories: Jammu and Kashmir with a legislature, and Ladakh without one.
- The political and legal status of Ladakh has remained a matter of debate, with the people advocating for Sixth Schedule inclusion due to the high proportion of Scheduled Tribes (over 90%).
- Under Article 244, the Sixth Schedule allows the establishment of ADCs, which govern tribal-majority areas. These councils, each having up to 30 members serving five-year terms, can legislate on issues related to land, forests, water, agriculture, village councils, health, sanitation, and policing at village and town levels.
- Currently, there are 10 ADCs in the Northeast, distributed as three each in Assam, Meghalaya, and Mizoram, and one in Tripura.
- Sonam Wangchuk, an engineer and innovator of sustainable technologies, is widely recognized for inspiring the character portrayed by Aamir Khan in the 2009 film 3 Idiots.
- In 2018, he was awarded the Ramon Magsaysay Award for his systematic, community-driven reforms in education and his efforts to improve opportunities for Ladakhi youth, serving as a model for minority communities worldwide
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Note: This is for reference Only - Reference Mains Structure and Reference midel Answer Only
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Answer (C)
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Will China capture the electrolyser market?
For Preliminary Examination: Current events of national and international Significance
For Mains Examination: GS III - Enviornment and ecology
Context:
In the clean energy market, the limelight has recently shifted from solar and wind towards green hydrogen. Hydrogen is widely used in industries for oil refining and ammonia and methanol production, but most of it is currently produced using fossil fuels, which add to carbon emissions. Green hydrogen technologies used in production, storage, transportation and application are rapidly advancing, with electrolysers at the core of this transformation. Electrolysers are central to its production, much like photovoltaic (PV) modules are to solar power. And just as no discussion on solar PVs is complete without examining China’s dominance in its supply chain, a similar story seems to be unfolding with electrolysers
Read about:
Photovoltaic (PV) modules
Green hydrogen technologies
Key takeaways:
In the global clean energy sector, attention has been shifting from traditional renewables such as solar and wind to green hydrogen. While hydrogen already plays a critical role in industries like oil refining and the production of ammonia and methanol, the majority of it is generated from fossil fuels, adding to carbon emissions. The focus now lies on developing green hydrogen technologies across production, storage, transport, and application stages. Electrolysers, in particular, have emerged as the backbone of this transformation, much like photovoltaic (PV) modules are for solar energy. Just as debates on solar PVs cannot overlook China’s dominance in the supply chain, a similar trend is now unfolding with electrolysers.
China’s position in green hydrogen
- By 2024, China had become the leading producer of hydrogen globally, generating around 36.5 million tonnes annually. Of this, nearly 1,20,000 tonnes was green hydrogen—accounting for close to half of the world’s total.
- In the electrolyser market, China commands almost 85% of global production capacity for alkaline (ALK) electrolysers. Currently, both Alkaline (ALK) and Proton Exchange Membrane (PEM) electrolysers are used commercially.
- ALK systems, being an established technology, are cheaper but less efficient in handling renewable power fluctuations. PEM electrolysers, though costlier, perform better under variable loads and yield hydrogen of higher purity.
- For the moment, China’s edge lies in its mass-scale ALK electrolyser production, catering both to domestic use and exports.
- China’s rapid build-up of electrolyser capacity, alongside its rollout of large-scale green hydrogen projects, has raised global concerns about its growing influence over the sector’s supply chains.
How China gained this advantage
- China replicated in electrolysers the strategy it had earlier applied in solar PVs: subsidised pricing, tightly integrated supply chains, control over raw material inputs, and speedy expansion of manufacturing capacity.
- ALK electrolysers from China are priced significantly lower than international averages, offering up to 45% cost savings for hydrogen plants in Europe. Price declines continue due to supply chain maturity and increased competition.
- In 2024, a 5 MW ALK electrolyser system cost about six million yuan (~$167/kW), 20% cheaper than in 2023. A 1 MW PEM system was also priced at six million yuan (~$838/kW), reflecting a 32% drop within a year.
- China benefits from abundant domestic supplies of nickel and steel, essential for ALK electrolysers. However, PEM electrolysers depend on scarce and expensive metals such as iridium, platinum, and titanium, which China imports heavily.
- Since hydrogen production requires specific system integration depending on its intended use and purity requirements, competition may increasingly depend on providing integrated solutions rather than price alone.
- Major Chinese renewable energy players such as LONGi and Envision have diversified into hydrogen, not only manufacturing electrolysers but also investing in overseas production facilities.
- For example, Guofu Hydrogen has partnered with German firms to build plants, while Envision Energy has unveiled the world’s largest green hydrogen and ammonia facility powered entirely by renewables.
Competition and challenges
- China appears well on track to dominate the green hydrogen equipment market through its aggressive scaling up of production and international outreach. However, replicating its solar success will not be straightforward.
- Unlike solar, green hydrogen has been designated as a strategic sector by many countries, which are keen to safeguard domestic industries. Consequently, Chinese imports are expected to face stricter regulations, barriers, and scrutiny.
- Concerns over supply chain resilience and energy security will likely shape how far Chinese products penetrate international markets, potentially curbing their expansion in this domain
Follow Up Question
Mains
1.Green hydrogen production utilizes electrolysis, a process powered by renewable energy sources. However, large-scale production of renewable energy also has environmental implications. Discuss the ethical considerations involved in promoting green hydrogen as a sustainable solution. (250 words)
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Note: This is for reference Only - Reference Mains Structure and Reference midel Answer Only
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Prelims
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Answer (A)
Statement 1: If pure hydrogen is used as a fuel, the fuel cell emits heat and water as by-products. ✅ Correct. Statement 2: Fuel cells can be used for powering buildings and not for small devices like laptop computers. ⌠Incorrect. Statement 3: Fuel cells produce electricity in the form of Alternating Current (AC). ⌠Incorrect. |