Daily Current Affairs 27 June 2026 – IAS Current Affairs

Current Affairs 27 June 2026 focuses on the Prelims-Mains perspective. Major events are :

Rupee And Bond Market Recovery

Source: Indian Express
GS III: Indian Economy and issues relating to planning, mobilization of resources, growth, development, and employment, Investment Models

Overview

1. News in Brief
2. Factors Responsible For The Rupee Recovery
3. Challenges
4. Way Forward

Why in the News?

The editorial in Indian Express explains the recent recovery of the Indian rupee and bond market due to lower global commodity prices, increased foreign investment, and improved global conditions.

News in Brief

• The Indian rupee appreciated against the US dollar after a period of depreciation, showing improvement in the foreign exchange market.
• The decline in 10-year Government Security (G-Sec) yields indicates higher investor confidence and lower borrowing costs for the government.
• The recovery helps reduce imported inflation and improve investor confidence, but it remains vulnerable to global uncertainties, geopolitical tensions, and domestic challenges.

Factors Responsible for the Rupee Recovery

Decline in Global Crude Oil Prices

• One of the biggest reasons behind the rupee’s appreciation is the fall in international crude oil prices.
• India imports nearly 85% of its crude oil requirements.
• Lower crude prices reduce India’s import bill.
• Reduced demand for US dollars by oil importers strengthens the rupee.
• Lower fuel prices also help in controlling inflation.
• Since petroleum products are essential for transportation, manufacturing, and electricity generation, cheaper crude oil benefits the entire economy.

Fall in Fertilizer Prices

• Global fertilizer prices have declined considerably.
• This has resulted in:
  • Lower fertilizer subsidy burden on the government.
  • Reduced fiscal pressure.
  • Improvement in government finances.
  • Better investor confidence.
• Lower subsidy expenditure allows the government to allocate resources for infrastructure and developmental activities.

Increase in Foreign Capital Inflows

• Foreign Portfolio Investors (FPIs) have returned to India’s debt market after a period of outflows.
• The government and RBI have encouraged foreign investments through:
  • Investment in Government Securities (G-Secs)
  • Relaxation of FCNR(B) deposit norms
  • Liberalization of External Commercial Borrowings (ECBs)
• As foreign investors bring dollars into India, the supply of foreign exchange increases, thereby strengthening the rupee.

Improvement in Government Bond Market

• The yield on India’s benchmark 10-year Government Security has declined.
• This indicates:
  • Increased demand for government bonds.
  • Improved investor confidence.
  • Lower borrowing costs for the government.
  • Better macroeconomic outlook.
• Since bond prices and yields move in opposite directions, rising bond prices automatically reduce yields.

Challenges

Geopolitical Risks

• The biggest concern is the continuing instability in West Asia.
• Any escalation of conflict may:
  • Disrupt crude oil supplies.
  • Increase global oil prices.
  • Widen India’s trade deficit.
  • Put pressure on the rupee.
• The Strait of Hormuz, through which nearly one-fifth of global oil trade passes, remains highly vulnerable to geopolitical tensions.

Volatile Foreign Investments

• Foreign Portfolio Investment is highly volatile.
• FPIs generally withdraw money during periods of:
  • Global uncertainty
  • Higher US interest rates
  • Geopolitical conflicts
  • Financial market volatility
• Large-scale withdrawals can weaken the rupee and create instability in capital markets.

Monsoon and El Niño Risks

• India’s agriculture remains dependent on the southwest monsoon.
• An El Niño event may lead to:
  • Weak rainfall
  • Lower agricultural production
  • Higher food inflation
  • Reduced rural demand
• Food inflation can force the RBI to maintain higher interest rates, slowing economic growth.

Fiscal Challenges

• Government expenditure on food subsidy, fertilizer subsidy welfare schemes may increase if global commodity prices rise again.
• Higher expenditure without corresponding revenue growth can widen the fiscal deficit and reduce investor confidence.

Way Forward

• India should not depend excessively on temporary foreign portfolio inflows.
• Instead, the country should focus on:
  • Attracting stable Foreign Direct Investment (FDI)
  • Continuing structural economic reforms
  • Improving ease of doing business
  • Expanding manufacturing under initiatives like Make in India
  • Maintaining fiscal discipline
  • Reducing the debt-to-GDP ratio
  • Diversifying energy sources to reduce dependence on imported crude oil.
• Such long-term measures will strengthen India’s external sector and improve resilience against global economic shocks.

Key Takeaways

UPSC Prelims Practice Question

Consider the following statements:

1. 1. Bond prices and bond yields generally move in opposite directions.
   2. A sustained increase in crude oil prices generally puts downward pressure on the Indian rupee.
   3. A stronger rupee helps reduce the cost of imports and can moderate imported inflation.

Which of the statements given above is/are correct?

a) 1 and 3 only
b) 2 and 3 only
c)  1 and 2 only
d) 1, 2 and 3

Answer: d) 1,2 and 3

Samagra Shishu Bal Swasthya Karyakram

Source: PIB
GS II: Issues relating to development and management of Social Sector/Services relating to Health, Education, Human Resources

Overview

1. News in Brief
2. How it helps

Why in the News?

Union Health Minister to Launch Samagra Shishu Bal Swasthya Karyakram (SSBSK) at 16th CCHFW Conference

News in Brief

• In a significant step towards strengthening newborn and child health services in the country, the Union Minister for Health and Family Welfare will launch the Samagra Shishu Bal Swasthya Karyakram (SSBSK).
• It will launch during the 16th Conference of the Central Council of Health and Family Welfare (CCHFW).

About Samagra Shishu Bal Swasthya Karyakram

• The launch will mark a major milestone in advancing the Government’s commitment to ensuring comprehensive, accessible and quality healthcare for every child.
• Providing a seamless continuum of home and community-based care from birth to 36 months of age.
• SSBSK will carry forward the vision of “Comprehensive care for the first three years”.
• It recognises the critical importance of the first three years of life for child survival, growth, nutrition and early brain development.

Approach

• SSBSK will be a unified national programme that will consolidate the two flagship community-based initiatives into a single comprehensive framework
  • Home-Based Newborn Care (HBNC)
  • Home-Based Care for Young Child (HBYC) .
• By integrating these programmes, SSBSK will ensure continuity of care from birth through the first three years of life, strengthening child survival, nutrition, healthy growth and early childhood development through an integrated approach.

Children at Risk

• For the first time, the programme will introduce a risk-stratified approach for newborns and children identified as ‘At-risk’.
• These children will receive intensified follow-up through additional home visits based on their level of risk.
• Under the programme, ‘At-risk’ newborns will receive up to nine home visits during the first 42 days, while ‘At-risk’ children will receive up to eight home visits up to 36 months of age.
• The programme will further strengthen continuity of care through joint home visits by Accredited Social Health Activists (ASHAs), Auxiliary Nurse Midwives (ANMs), Community Health Officers (CHOs) and Anganwadi Workers (AWWs).
• It will also introduce Well-Baby Sessions at every Village Health, Sanitation and Nutrition Day (VHSND) and a monthly Shishu Shivir at Ayushman Arogya Mandirs for early identification, assessment and management of ‘At-risk’ children.

Implementation of Digital Technologies

• The programme will leverage digital technologies through Decision-Support Systems (DSS), child tracking applications, referral loops and alert mechanisms to strengthen monitoring and continuity of care.
• These digital systems will be aligned with the JANANI Portal, U-WIN Portal, MPCDSR Portal, RBSK 2.0 Portal and POSHAN Tracker, enabling seamless data exchange and service continuity through ABHA and Baal-ABHA IDs.
• It will also address home-based care in urban settings through tailored strategies for slum, migrant and underserved populations.3
• The guidelines will also address emerging challenges of the digital era by promoting age-appropriate play, physical activity and mental stimulation during the first three years of life
• At the same time, recognising the adverse impact of excessive screen time and reduced physical interaction on brain development, emotional health and social skills.

Key Takeaways

India-China Strategic Economic Dialogue: Background, Benefits, Challenges, Way Forward

Source: Indian Express
GS II: India and its Neighbourhood – Relations 

Overview

1. News in Brief
2. Background of India-China Strategic Economic Dialogue
3. Benefits of Resuming the Strategic Economic Dialogue
4. Key Concerns
5. Way Forward

Why in the News?

Recent improvements in India–China relations have renewed calls to resume the India–China Strategic Economic Dialogue (SED) to strengthen economic cooperation alongside diplomatic and security engagement.

News in Brief

• India and China recently signaled an improvement in bilateral ties through high-level diplomatic interactions.
• Both countries agreed to accelerate the resumption of dialogue mechanisms in trade, finance, and other sectors.
• The economic engagement is seen as an important pillar alongside ongoing diplomatic and security discussions.

Background of India–China Strategic Economic Dialogue

• The India–China Strategic Economic Dialogue (SED) is a high-level institutional mechanism established in 2010 during the tenure of Prime Minister Manmohan Singh and Chinese Premier Wen Jiabao to strengthen bilateral economic cooperation.
• It serves as a platform for cooperation in areas such as:
  • Macroeconomic policy coordination
  • Trade and investment
  • Infrastructure
  • Energy
  • High technology
  • Pharmaceuticals
  • Resource conservation
  • Environmental protection
• On the Indian side, the dialogue was initially coordinated by the Planning Commission and later by NITI Aayog.
• Six rounds of the dialogue were held between 2011 and 2019.
• The dialogue has remained suspended since the 2020 India–China border tensions along the Line of Actual Control (LAC).

Benefits of Resuming the Strategic Economic Dialogue

• Expand Engagement Beyond the Border
  • Bilateral relations should not remain confined to the boundary dispute.
  • Economic cooperation can continue while managing strategic differences.
• Support India’s Development Goals
  • China remains a major global manufacturing hub.
  • Economic engagement can support India’s industrial growth, technology adoption, and infrastructure development.
• Strengthen Energy Security
  • Both countries share an interest in:
    • Stable global energy markets
    • Renewable and clean energy
    • Secure energy supply chains
• Promote Regional Economic Cooperation
  • Stronger India–China economic engagement can contribute to Asian economic integration.
  • It can create opportunities in infrastructure, manufacturing, and emerging technologies.

Key Concerns

• Trade Imbalance
  • India continues to face a significant merchandise trade deficit with China.
  • Heavy dependence on Chinese imports, especially machinery, electronics, and industrial inputs, remains a major concern.
• Geopolitical and Security Challenges
  • Border disputes and strategic rivalry continue to influence bilateral relations.
  • Economic engagement must be balanced with national security considerations.
• Changing Global Economic Landscape
  • US–China trade tensions and shifting global supply chains have reshaped international trade.
  • Amid global uncertainties, developing economies are seeking greater economic cooperation and resilient supply chains.

Way Forward

• Resume the Strategic Economic Dialogue alongside existing diplomatic and security mechanisms to sustain regular engagement.
• Reduce the Trade Imbalance by improving market access for Indian exports and diversifying the export basket.
• Deepen Cooperation in Key Sectors such as renewable energy, the digital economy, infrastructure, pharmaceuticals, and emerging technologies.
• Balance Economic Cooperation with Strategic Interests by expanding mutually beneficial engagement while safeguarding national security concerns.

Key Takeaways

UPSC Prelims And Mains Practice Question

Consider the following statements regarding the India–China Strategic Economic Dialogue (SED):

1. It was launched to promote cooperation on macroeconomic policy, trade, infrastructure, and energy.
2. It continued uninterrupted after the 2020 India–China border tensions.
3. The dialogue was initially coordinated on the Indian side by the Planning Commission.
4. One of its objectives was to promote cooperation in high technology and environmental protection.

Which of the statements given above are correct?

a) 1 and 2 only
b) 1, 3 and 4 only
c)  2 and 3 only
d) 1, 2, 3 and 4

Answer: b) 1,3 and 4 only

Mains Practice Question

Q. Economic diplomacy has become an important instrument in managing complex bilateral relationships. Discuss this statement in the context of India–China relations, highlighting the role of the Strategic Economic Dialogue (SED). (10 Marks, 150 Words)

Energy Diversification, Small Modular Reactors And PLI Scheme: Explained

Source: Indian Express
GS III: Indian Economy, Industrial Growth, Infrastructure

Overview

1. News in Brief
2.  Key Highlights
3. Way Forward

Why in the News?

The President of the Confederation of Indian Industry (CII) called for continuing the PLI Scheme, diversifying energy sources, securing critical minerals, and advancing reforms to strengthen India’s manufacturing resilience after the West Asia conflict.

News in Brief

• The West Asia conflict disrupted global energy markets and supply chains, highlighting India’s dependence on imported crude oil, natural gas, fertilisers, and critical minerals.
• The crisis underscored the need to strengthen India’s resource mobilisation and reduce vulnerabilities arising from import dependence.
• India should accelerate domestic exploration of oil, gas, and minerals while diversifying import sources to build resilient supply chains and enhance economic security.

Key Highlights

PLI Scheme Must Continue to Strengthen Manufacturing

• The Production Linked Incentive (PLI) Scheme has significantly contributed to India’s manufacturing sector by attracting investments, creating employment, boosting exports, and increasing tax revenues.
• Rather than discontinuing the scheme, the government should modify it wherever necessary to improve sectoral performance.
• Future PLIs should prioritize:
  • Export-oriented industries.
  • Import-intensive sectors.
  • High-value manufacturing.
  • Chemicals used for Active Pharmaceutical Ingredients (APIs) to reduce dependence on imports.
• The PLI scheme also helps India integrate into Global Value Chains (GVCs) while supporting the vision of Atmanirbhar Bharat.

MSMEs are Central to Supply Chain Resilience

• India’s MSMEs play a critical role in employment generation and industrial production.
• MSMEs should become globally competitive through better technology, finance, and infrastructure support so thet they can participate effectively in domestic and global supply chains.
• A strong MSME ecosystem will reduce dependence on imports while improving manufacturing competitiveness.

Energy Diversification is Essential for Energy Security

• India should build a diversified energy portfolio comprising:
  • Solar energy
  • Wind energy
  • Biomass
  • Biofuels
  • Hydropower
  • Nuclear energy
  • Tidal energy
  • Green Hydrogen
• It will ensure reliable, affordable, and clean energy while reducing import dependence and enhancing climate commitments.

Small Modular Reactors (SMRs): The Future of Nuclear Energy

• With many countries investing in SMRs, India should strengthen indigenous capabilities in reactor design, manufacturing, and innovation.

Strengthening the Entire Manufacturing Value Chain

• Industrial growth cannot be achieved through downstream manufacturing alone.
• India must simultaneously strengthen:
  • Upstream industries (raw materials and intermediate goods)
  • Component manufacturing
  • Domestic supply chains
  • Testing, Maintenance, Repair and Overhaul (MRO) ecosystem
• The evolution of India’s electronics sector from assembly to component manufacturing is an example of value-chain development that should be replicated in sectors like aerospace, defence, and chemicals.

Way Forward

• Continue and refine the PLI Scheme with greater focus on domestic value addition and export competitiveness.
• Strengthen MSMEs and build resilient supply chains for energy, critical minerals, and manufacturing.
• Diversify the energy mix by expanding renewable energy, nuclear power, and promoting Small Modular Reactors (SMRs).
• Undertake structural reforms in ease of doing business, land, labour, logistics, taxation, technology, and innovation to improve the investment climate.
• Accelerate trade agreements and integration into Global Value Chains (GVCs) while safeguarding India’s strategic and economic interests.

UPSC Value Addition

Production Linked Incentive (PLI) Scheme

• Launched in 2020 under the Atmanirbhar Bharat Abhiyan.
• Aims to boost domestic manufacturing and make India a global manufacturing hub by offering financial incentives linked to incremental production.
• Objectives
  • Promote domestic manufacturing.
  • Attract domestic and foreign investments.
  • Increase exports.
  • Generate employment opportunities.
  • Reduce import dependence.
  • Integrate India into Global Value Chains (GVCs).
• Key Features
  • Incentives are provided based on incremental production/sales over a defined base year.
  • Covers 14 strategic sectors.
  • Encourages technology adoption and value addition in manufacturing.
• Major Sectors Covered
  • Electronics and mobile manufacturing, pharmaceuticals, medical devices, telecom and networking products, automobiles and auto components, food processing, textiles, specialty steel, white goods (air conditioners and LED lights), high-efficiency solar PV modules, drones and drone components, and Advanced Chemistry Cell (ACC) batteries.
• Achievements
  • Attracted significant domestic and foreign investments.
  • Boosted electronics and mobile phone exports.
  • Created employment across manufacturing sectors.
  • Increased domestic production capacity.
  • Enhanced tax revenues and industrial output.
• Challenges
  • Low domestic value addition in some sectors.
  • Continued dependence on imported raw materials and components.
  • Uneven performance across different PLI sectors.
  • Infrastructure and logistics bottlenecks.
  • Limited participation of MSMEs in supply chains.
• Significance for India
  • Strengthens the Make in India initiative.
  • Promotes Atmanirbhar Bharat by reducing import dependence.
  • Enhances India’s competitiveness in global manufacturing.
  • Improves export potential and foreign exchange earnings.
  • Supports long-term industrial growth and economic resilience.

Energy Security

• Four Pillars
  • Availability: Adequate supply of energy resources.
  • Accessibility: Reliable access to energy for all consumers.
  • Affordability: Energy at reasonable and stable prices.
  • Sustainability: Environmentally sustainable and clean energy sources.
• Key Challenges
  • High dependence on imported crude oil and natural gas.
  • Reliance on imported critical minerals for clean energy technologies.
  • Geopolitical conflicts affecting global energy supplies.
  • Rising electricity demand due to economic growth.
  • Balancing energy needs with climate change commitments.
• Major Government Initiatives
  • National Green Hydrogen Mission.
  • PM-KUSUM.
  • National Solar Mission.
  • Strategic Petroleum Reserves.
  • Biofuel Policy.
  • Nuclear Energy Expansion.

Critical Minerals

• What are Critical Minerals?
  • Critical minerals are minerals essential for strategic industries, clean energy technologies, and national security, with limited domestic availability or supply risks.
• Importance
  • They are indispensable for electric vehicles (EVs), battery manufacturing, renewable energy, semiconductors, defence equipment, aerospace, electronics, and advanced manufacturing.
• Major Critical Minerals
  • Lithium, cobalt, nickel, copper, graphite, and rare earth elements (REEs).
• Government Measures
  • National Critical Mineral Mission, auction of critical mineral blocks, overseas acquisition of mineral assets, and international cooperation through the Mineral Security Partnership (MSP).

Key Takeaways

UPSC Prelims Practice Question

Consider the following statements regarding the Production Linked Incentive (PLI) Scheme:

1. 1. It aims to enhance domestic manufacturing and reduce import dependence.
   2. Incentives are linked to incremental production or sales by eligible firms.
   3. The scheme is currently limited to the electronics and pharmaceutical sectors only.

Which of the statements given above is/are correct?

a) 1 and 2 only
b) 2 and 3 only
c) 1 and 3 only
d) 1, 2 and 3

Answer: a) 1 and 2 only

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