Current Affairs — 13 August 2026

1. UPI at 10: The Digital Payments Revolution and the MDR Debate

Core Context: The Unified Payments Interface has just completed a decade of existence, and this anniversary has coincided with a significant legislative shift. Parliament recently passed an amendment removing the long-standing legal bar on charging a Merchant Discount Rate on UPI and RuPay debit card transactions. This reopens one of the more consequential debates in India's digital economy: how does a payments system that has become a genuine public good sustain itself financially without discouraging the very inclusion it was built to promote?

Latest Developments:

• The amendment modifies a provision of the law governing payment and settlement systems that previously prohibited any merchant fee on UPI and RuPay transactions.
• UPI now accounts for the overwhelming bulk of India's non-cash digital transactions, with tens of crores of active users and hundreds of banks, payment service providers and third-party applications forming its ecosystem.
• A handful of private applications process the vast majority of UPI's transaction volume and value, raising concerns about market concentration that the regulator has so far been reluctant to enforce against.
• Maintaining UPI's round-the-clock infrastructure, fraud prevention systems and compliance mechanisms is expensive, and current government subsidies cover only part of this cost, since the zero-fee mandate introduced in 2020 continues to apply to small transactions and small merchants.
• The proposed reform envisages a calibrated approach: ordinary citizen-to-citizen transfers and payments to small shopkeepers would remain completely free, while a modest fee would apply only to high-value transactions made to large commercial establishments.

UPSC Prelims Pointers:

• UPI was developed by the National Payments Corporation of India under the guidance of the Reserve Bank of India and runs on the Immediate Payment Service protocol.
• The zero-MDR policy on UPI and RuPay debit cards was introduced in 2020 following recommendations linked to a committee on deepening digital payments headed by Nandan Nilekani.
• Payment systems in India are regulated under the Payment and Settlement Systems Act, 2007, which empowers the Reserve Bank of India as the designated authority.
• Merchant Discount Rate refers to the fee a merchant pays to facilitate a digital payment, typically shared among the card issuer, acquiring bank and payment network.

2. The National Food Security (Amendment) Bill, 2026: Rethinking Antyodaya Entitlements

Core Context: Public health experts have flagged important policy implications of a draft bill that seeks to restructure how foodgrains are allocated to the poorest households under India's food security law. At present, Antyodaya Anna Yojana households, regardless of their size, receive a flat monthly quota, which means a household of two persons and a household of six persons currently get the same total ration. The proposed amendment shifts this to a per-person basis, and while it aims to correct an equity anomaly, it has triggered a fresh debate on whether the neediest and smallest households, such as those with a single elderly person or a person with disability, might actually end up worse off.

Latest Developments:

• The draft amendment proposes that every individual belonging to an Antyodaya Anna Yojana household would be entitled to a fixed quantity of foodgrain per month, subject to an overall household ceiling that matches the existing flat entitlement.
• The change intends to correct an anomaly where smaller Antyodaya households currently receive more foodgrain per person than larger ones, since the entitlement has so far been calculated per household rather than per person.
• Analysts point out that capping the entitlement at the household ceiling could reduce the effective allocation for a large share of Antyodaya households that have fewer than five members, since their total quota would now depend on headcount rather than a guaranteed flat amount.
• The beneficiary ceiling under the food security law is still based on Census 2011 population figures, meaning that a much smaller share of today's actual population is formally covered than the law originally intended.
• Nutrition data presented alongside the bill shows a mixed picture: stunting among children has declined, but wasting and being underweight remain stubbornly high, and only a small proportion of infants receive a minimally adequate diet, even as diabetes and prediabetes affect a large number of Indian adults.

UPSC Prelims Pointers:

• The National Food Security Act, 2013 guarantees subsidised foodgrain to Priority Households and Antyodaya Anna Yojana households under the Targeted Public Distribution System.
• Priority Households are entitled to 5 kilograms of foodgrain per person per month, while Antyodaya Anna Yojana households currently receive 35 kilograms per household per month.
• Antyodaya Anna Yojana was launched in the year 2000 to specifically target the poorest of the poor among below-poverty-line families.
• The Act mandates coverage of up to seventy-five percent of the rural population and fifty percent of the urban population, based on Census-linked ceilings.

3. The Mines and Minerals (Development and Regulation) Amendment Bill, 2026

Core Context: With both Houses of Parliament clearing this bill, India has taken another step toward securing its supply chains for critical and strategic minerals such as lithium, cobalt, nickel and graphite, which are essential for clean energy technology, electronics and defence manufacturing. The amendment updates the seven-decade-old Mines and Minerals (Development and Regulation) Act, 1957, and reflects a broader global race among countries to lock in access to minerals that will power the energy transition.

Latest Developments:

• Holders of existing mining leases can now seek state government approval to add other minerals, including critical and strategic minerals like lithium, graphite, nickel, cobalt, gold and silver, to their leases without any additional payment.
• The National Mineral Exploration Trust is being expanded in scope and renamed to also fund mineral and mine development, not just exploration, and will now be called the National Mineral Exploration and Development Trust.
• The existing ceiling that restricted captive mines from selling more than half their mineral output in the open market has been removed, giving captive mine holders greater commercial freedom.
• The amendment also restricts state governments from imposing fresh taxes on mineral rights and mineral-bearing land without conditions set by the Central government, a provision likely to reignite the ongoing Centre-State debate over control of mineral resources.

UPSC Prelims Pointers:

• Mines and minerals fall under the Union List in respect of regulation and development declared by Parliament to be expedient in the public interest, under Entry 54.
• The National Mineral Exploration Trust was originally set up in 2015 and is funded through a statutory contribution linked to royalty payments made by mining lease holders.
• Critical minerals identified by India include lithium, cobalt, nickel, graphite and rare earth elements, all vital for batteries, semiconductors and renewable energy equipment.
• The Supreme Court, in an earlier significant ruling on mineral taxation, held that states possess the legislative competence to tax mineral rights, a position that legislative changes of this kind continue to interact with.

4. Protecting the National Song: The Prevention of Insults to National Honour (Amendment) Bill, 2026

Core Context: As India marked significant milestones associated with the national song this year, Parliament passed, and the President gave assent to, an amendment that criminalises the intentional disruption of the singing of Vande Mataram, extending to it the same legal protection that has long been available to the National Anthem, Jana Gana Mana. For the first time, Vande Mataram was rendered from the ramparts of the Red Fort as part of Independence Day observances, underlining the symbolic weight of this legislative change.

Latest Developments:

• The amendment updates the existing law on prevention of insults to national honour to explicitly prohibit intentionally preventing the singing of the national song or causing disturbance to any gathering engaged in singing it.
• Both Houses of Parliament passed the bill before it received Presidential assent, formally making it law.
• The move places Vande Mataram on a similar legal footing to the National Anthem in terms of protection against intentional insult, even though the two continue to hold distinct constitutional and historical status.

UPSC Prelims Pointers:

• Vande Mataram was composed by Bankim Chandra Chattopadhyay and first appeared in his novel Anandmath, published in 1882.
• The Constituent Assembly adopted Vande Mataram as the National Song and Jana Gana Mana as the National Anthem on the same day, 24 January 1950.
• The original Prevention of Insults to National Honour Act was enacted in 1971 and penalises insults to the National Flag, the Constitution and the National Anthem.
• Unlike the National Anthem, the National Song does not have an explicit constitutional provision defining it; its status rests on convention and parliamentary practice.

5. Parliament Passes Bill to Rename Kerala as Keralam

Core Context: Following a unanimous resolution passed by its Legislative Assembly, the state of Kerala will now be officially known as Keralam, its name in Malayalam, after Parliament passed the Kerala (Alteration of Name) Bill, 2026. The episode is a good illustration of how the Constitution allows the internal boundaries and names of India's federal units to be reshaped through an ordinary parliamentary process rather than through a rigid constitutional amendment.

Latest Developments:

• The bill amends the First Schedule of the Constitution, which lists the names and territorial extent of every state, to substitute Kerala with Keralam.
• The process began with the State Legislative Assembly passing a resolution requesting the change, after which a bill could be introduced in Parliament only on the prior recommendation of the President.
• Before making this recommendation, the President is required to refer the proposal to the concerned State Legislature for its views within a specified period, though these views are not binding on Parliament.
• Being treated as an ordinary law under the relevant constitutional provision, the bill required only a simple majority in both Houses, rather than the special majority needed for many other constitutional amendments.

UPSC Prelims Pointers:

• Article 3 of the Constitution empowers Parliament to form new states, alter boundaries, and change the names of existing states by ordinary legislation.
• Article 4 clarifies that laws made under Article 3, including those amending the First Schedule, are not to be treated as constitutional amendments under Article 368.
• Earlier examples of state renaming include Orissa becoming Odisha in 2011, Uttaranchal becoming Uttarakhand in 2007, and Pondicherry becoming Puducherry in 2006.
• Renaming a Union Territory follows a similar consultative logic, though Parliament is not bound to seek a legislature's views in every case, since not all union territories have one.

6. The Saudi Arabia-Pakistan-Turkiye Defence Pact and Its Implications for India

Core Context: A trilateral defence agreement signed in Mecca by the leaderships of Saudi Arabia, Pakistan and Turkiye has drawn close attention in New Delhi. Under the arrangement, an armed attack on any one of the three countries would be treated as an attack on all three, effectively creating a mutual defence clause among three influential Islamic-majority powers, one of which is a nuclear-armed neighbour of India.

Latest Developments:

• The pact brings together Saudi Arabia's financial and oil-driven regional influence, Turkiye's substantial defence manufacturing base and large conventional military, and Pakistan's nuclear weapons capability.
• India's external affairs establishment has stated that it is studying the security implications of the agreement, given Pakistan's inclusion in a collective security framework alongside two influential West Asian powers.
• The development comes against the backdrop of expanding defence cooperation between Pakistan and Turkiye in recent years and a broader recalibration of Saudi Arabia's regional strategic posture.
• Commentators have noted that the pact could push India to deepen its own strategic partnerships in West Asia and beyond to balance the emerging alignment.

UPSC Prelims Pointers:

• India's engagement with the Gulf region is often discussed under the framework of the Link West policy, which emphasises energy security, diaspora welfare and trade.
• India maintains strategic partnerships with several Gulf countries, including Saudi Arabia and the United Arab Emirates, through mechanisms such as Strategic Partnership Councils.
• Mutual defence clauses, where an attack on one member is treated as an attack on all, are a classic feature of collective security arrangements, historically associated with alliances such as NATO's Article 5.
• Turkiye is a member of NATO, giving its bilateral and trilateral defence arrangements added geopolitical significance beyond the immediate region.

7. India-Mauritius Maritime Cooperation: The Navy Chief's Visit

Core Context: The Chief of the Naval Staff undertook a four-day visit to Mauritius, his first to the island nation since taking charge, to deepen bilateral maritime cooperation and defence ties. The visit reflects the enduring importance India attaches to Mauritius as a key partner in the Indian Ocean Region, particularly given the island's strategic location along vital sea lanes.

Latest Developments:

• During the visit, the Navy Chief held meetings with the senior leadership of the Government of Mauritius, including the Prime Minister, focusing on maritime security, defence cooperation and capacity building.
• The engagement is positioned within India's broader vision for maritime cooperation in the region, which emphasises security and growth for all in the region.
• Strengthening operational-level linkages between the two navies is expected to consolidate the long-standing strategic partnership between India and Mauritius.

UPSC Prelims Pointers:

• Mauritius lies in the southwestern Indian Ocean and is considered part of India's extended maritime neighbourhood.
• India's vision for maritime cooperation in the Indian Ocean Region was earlier articulated through the SAGAR doctrine, meaning Security and Growth for All in the Region, and has since evolved into the broader MAHASAGAR framework.
• India has historically supported Mauritius through defence platforms, coastal surveillance radar systems and capacity-building assistance, reflecting a long-standing security partnership.
• Mauritius hosts a significant population of Indian origin, adding a cultural and diaspora dimension to the bilateral relationship alongside strategic considerations.

8. Cess: A Purpose-Bound Fiscal Tool

Core Context: The imposition of a new widow and orphan welfare cess on petrol and diesel by the Himachal Pradesh government has brought renewed attention to how cesses work as a fiscal instrument, distinct from ordinary taxes, and why states increasingly favour them to fund targeted welfare goals.

Latest Developments:

• A cess is a specialised tax levied over and above regular taxes to raise revenue for a specific, pre-determined purpose, and is expected to be withdrawn once that purpose has been achieved.
• Revenue collected through Union cesses and surcharges is excluded from the divisible pool of taxes that the Centre must share with states as per Finance Commission recommendations, allowing the Centre to retain the entire amount.
• State legislatures can impose their own cesses on subjects falling within the State List or Concurrent List, and several states have used fuel sales as a convenient base for welfare-linked cesses.
• Funds raised through a cess are meant to be ring-fenced for their stated purpose and are typically routed into dedicated, non-lapsable funds rather than the general exchequer.

UPSC Prelims Pointers:

• The constitutional basis for cesses and surcharges levied by the Union lies in Article 270, which governs the distribution of tax revenues between the Centre and the states.
• Prominent examples of Union-level cesses in recent years include the Goods and Services Tax Compensation Cess and the Health and Education Cess.
• Unlike a surcharge, which is a tax on tax with no earmarked purpose, a cess must legally be spent only on the specific objective for which it was created.
• Because cess revenue bypasses the divisible pool, states have often flagged increasing reliance on cesses and surcharges as a concern for fiscal federalism.

9. The One Herb, One Standard Initiative

Core Context: The Ministry of Ayush and the Ministry of Health and Family Welfare have renewed, for a further three years, their joint effort to create single, scientifically validated quality standards for medicinal plants used across India's diverse traditional medicine systems, an initiative that speaks directly to the credibility and export potential of India's traditional medicine sector.

Latest Developments:

• The initiative aims to harmonise testing methods and quality parameters for the same medicinal plant across the pharmacopoeias of modern medicine and traditional systems, so that regulators, manufacturers and laboratories use one common reference standard instead of conflicting ones.
• The first phase, initiated a few years ago, resulted in the development of quality monographs for fifty individual medicinal herbs, and the renewed partnership is expected to expand this list further.
• The initiative applies to medicinal plants used across five recognised traditional systems, and aligns Indian standards with accepted international benchmarks to support global trade in Indian herbal products.

UPSC Prelims Pointers:

• The Pharmacopoeia Commission for Indian Medicine and Homoeopathy functions under the Ministry of Ayush and sets quality standards for Ayurvedic, Siddha, Unani and Homoeopathic drugs.
• The Indian Pharmacopoeia Commission is an autonomous body under the Ministry of Health and Family Welfare responsible for setting standards for modern pharmaceuticals.
• India officially recognises Ayurveda, Yoga and Naturopathy, Unani, Siddha, Sowa-Rigpa and Homoeopathy as its traditional and complementary systems of medicine, together represented by the acronym AYUSH.
• Sowa-Rigpa, one of the systems covered under such standardisation efforts, is a traditional medicine system practised largely in the Himalayan and trans-Himalayan regions, including Ladakh and Sikkim.

10. Srijan: Voices from the Loom

Core Context: The Ministry of Textiles organised a special programme in New Delhi to celebrate the contribution of women weavers to India's handloom heritage, bringing together artisans from multiple handloom clusters to share their personal journeys of skill, resilience and cultural preservation.

Latest Developments:

• The programme brought together more than a hundred women weavers from six handloom clusters to narrate first-person accounts of their craft, challenges and achievements.
• An anthology documenting the stories and voices of the participating weavers was released as part of the event, intended to serve as a lasting record of their contribution.
• The initiative is meant to enhance the visibility of women artisans, who form the backbone of India's handloom workforce, while promoting traditional weaving knowledge and its transmission across generations.

UPSC Prelims Pointers:

• National Handloom Day is observed on 7 August every year, commemorating the launch of the Swadeshi Movement in 1905.
• Women constitute a very large majority of India's handloom workforce, making gender an important lens for understanding livelihood policy in this sector.
• Key government schemes for the sector include the Handloom Weavers Comprehensive Welfare Scheme and the India Handloom Brand, which certifies quality handloom products for niche and export markets.
• The handloom sector is the second-largest source of rural employment in India after agriculture, underlining its significance for inclusive economic growth.

11. The Panama Canal in the News

Core Context: Reports that a container ship paid nearly four million dollars to skip a ten-day queue at the Panama Canal, amid surging global shipping demand and drought-related transit restrictions, have once again highlighted the strategic and economic importance of this narrow, artificial waterway that connects two oceans.

Latest Developments:

• Rising demand for shipping slots, partly driven by vessels being diverted away from conflict-affected routes in West Asia, has intensified competition for transit through the canal.
• The Panama Canal Authority operates a competitive auction system that allows vessels without a pre-booked slot to bid substantial premiums to bypass queues, which explains episodes of extremely high payments by shipping companies in a hurry.
• Water availability remains a persistent operational constraint for the canal, since its lock system depends on freshwater from adjoining lakes rather than seawater, making it vulnerable to droughts.

UPSC Prelims Pointers:

• The Panama Canal connects the Atlantic Ocean, via the Caribbean Sea, with the Pacific Ocean across the Isthmus of Panama, and was officially opened in the year 1914.
• It was built by the United States, jointly administered under the Panama Canal Commission from 1979, and handed over fully to Panama on 31 December 1999.
• The canal's lock system is fed by freshwater from Gatun Lake and Alajuela Lake, both sourced from the Chagres River, and lifts ships above sea level to cross the continental divide.
• A third, wider set of locks capable of handling larger vessels, known as the Neopanamax locks, was opened in 2016 to expand the canal's capacity.

12. The Indonesian Babirusa: A Conservation Story

Core Context: The birth of a rare babirusa piglet at a zoo in the United Kingdom has drawn attention to the precarious status of this unusual wild pig species in its native Indonesian habitat, where African swine fever, habitat loss and hunting continue to threaten its already declining wild population.

Latest Developments:

• The birth is being viewed as an important addition to global conservation breeding efforts for the species, which faces mounting pressure in the wild from disease outbreaks and shrinking forest habitat.
• African swine fever, a highly lethal viral disease affecting pigs, has emerged as a significant additional threat to wild babirusa populations, compounding existing risks from habitat loss and hunting.
• Captive breeding programmes are increasingly seen as a genetic safety net for species whose wild numbers are shrinking rapidly due to a combination of ecological and disease-related pressures.

UPSC Prelims Pointers:

• The babirusa is endemic to a small set of Indonesian islands, namely Sulawesi, Togian, Sula and Buru, and is sometimes called the pig-deer because of the unusual upward-curving tusks of the males.
• It is currently classified as Vulnerable on the IUCN Red List of Threatened Species.
• These islands fall within the Wallacea biogeographic region, a transition zone between the Asian and Australian faunal realms named after the naturalist Alfred Russel Wallace.
• African swine fever does not affect humans but is highly contagious and often fatal among pigs, making it a serious concern for both wildlife conservation and the livestock economy.

13. The 'Sprite' Tejas Express: India's First Corporate-Branded Train

Core Context: Indian Railways and its catering and tourism arm have handed full commercial branding rights of the Lucknow-Delhi Tejas Express to a beverage company for six months, marking the first time a scheduled Indian train service has carried a corporate brand name, a step that signals a new approach to generating non-fare revenue for the railways.

Latest Developments:

• The branding arrangement covers external and internal displays as well as station announcements, making it the first instance in Indian Railways' history of a corporate name being incorporated into a scheduled train's identity.
• The train continues to operate under the existing infrastructure and zonal supervision of the railway network, with the operating corporation paying the usual haulage charges to Indian Railways.
• The move is part of a broader push to explore non-fare revenue streams, such as branding and advertising rights, to supplement traditional ticket-based earnings.

UPSC Prelims Pointers:

• The Tejas Express brand was introduced by Indian Railways as a semi-high-speed, fully air-conditioned service, with early trains operated on the Mumbai-Goa and Lucknow-Delhi corridors.
• The Indian Railway Catering and Tourism Corporation operates Tejas Express trains and is also responsible for catering, tourism and online ticketing services across the railway network.
• Non-fare revenue for Indian Railways includes income from advertising, branding, and monetisation of land and stations, an area of increasing policy focus given the operating ratio pressures on the railways.