Monthly Current Affairs January 2025

Current Affairs January 2025

Economic Survey 2025: Key Insights, Summary, and Notable Highlights

The Economic Survey 2024-25, compiled by the Ministry of Finance, Government of India, provides a comprehensive review of the country’s economic progress, sectoral developments, and strategic policy directions. Below is a chapter-wise breakdown of the survey’s key takeaways:

Chapter 1: Economic Performance Overview

The global economy in 2024 experienced varied growth trends, with manufacturing slowing in Europe and Asia due to supply chain disruptions, while services continued to support economic expansion. Although inflationary pressures eased, geopolitical uncertainties persist. India maintained steady growth, with real GDP estimated at 6.4% for FY25. The agriculture and services sectors were primary contributors in the first half of the year, whereas manufacturing faced setbacks. Factors such as a strong external balance, disciplined fiscal policies, and a surplus in service sector trade bolster India’s macroeconomic stability. Food inflation is anticipated to ease due to a robust Kharif harvest and improving agricultural conditions.

Chapter 2: Monetary and Financial Sector Updates

The Reserve Bank of India (RBI) maintained a stable monetary policy, keeping the repo rate at 6.5% for most of FY25 before adopting a neutral stance and reducing the Cash Reserve Ratio (CRR) to 4%, injecting ₹1.16 lakh crore into the banking system. Bank credit growth remained robust, non-performing assets (NPAs) declined, and profitability in the banking sector improved. The capital market thrived, with increased IPO activity, higher investor participation, and greater financial inclusion.

Chapter 3: External Trade and Foreign Investments

Despite global economic uncertainties, India’s trade sector remained resilient in FY24. Proactive export promotion measures and enhancements in the ease of doing business supported trade expansion. India continued to attract Foreign Direct Investment (FDI), particularly in manufacturing and technology. The balance of payments remained stable, with a surplus in services trade counterbalancing challenges in goods trade.

Chapter 4: Inflation Trends and Price Stability

Global inflation, which peaked at 8.7% in 2022, declined to 5.7% in 2024. In India, retail inflation moderated to 4.9% in FY25, assisted by government initiatives and improved supply chains. Food inflation, primarily driven by fluctuations in onion and tomato prices, was controlled through strategic buffer stocking. The overall inflation outlook remains stable, supported by steady core inflation and projected declines in global commodity prices.

Chapter 5: Medium-Term Growth and Economic Liberalization

India’s long-term growth potential is linked to structural reforms and economic liberalization, which aim to enhance business ease and economic freedoms. To realize the vision of a Developed India (Viksit Bharat) by 2047, an 8% annual growth rate is necessary over the next two decades. The International Monetary Fund (IMF) forecasts India’s economy to reach $5 trillion by FY28 and $6.3 trillion by FY30. The chapter underscores the importance of removing regulatory hurdles to foster sustainable economic growth.

Chapter 6: Infrastructure and Investment Trends

Post-election infrastructure investment surged, driven by increased public capital expenditure. This chapter explores advancements in power, digital, urban, and rural infrastructure, along with developments in tourism and space infrastructure. The focus remains on sustaining both public and private investment to ensure long-term growth in infrastructure.

Chapter 7: Industrial Growth and Business Reforms

India’s industrial sector demonstrated significant progress, particularly in core industries such as steel, cement, and chemicals. The chapter highlights the role of business-friendly policies and deregulation in facilitating growth. Innovations in capital goods, consumer products, and R&D were emphasized, with the Production-Linked Incentive (PLI) scheme cited as instrumental in indigenization, especially in the air conditioning sector.

Chapter 8: Service Sector Developments

India’s service sector continued to expand, driven by IT, business services, and logistics. Foreign investment in the sector remained strong, reinforcing its role in economic growth. Improved physical connectivity via railways, airways, and waterways boosted domestic tourism. State-wise variations in service sector performance were examined, highlighting the sector’s significance in India’s economic trajectory.

Chapter 9: Agriculture and Food Management

Government initiatives such as PM-KISAN and the Pradhan Mantri Kisan Maandhan Yojana supported agricultural growth. Challenges in productivity for pulses and oilseeds persist, but the sector remains crucial for food security. The survey emphasizes the need for sustainable farming, efficient resource utilization, and diversification toward high-productivity crops.

Chapter 10: Climate and Environmental Policies

India’s climate strategy focuses on adaptation measures to address environmental challenges. The chapter examines global energy transition strategies and their applicability to India. The government’s approach aims to balance the transition to sustainable energy with energy security. The Lifestyle for Environment (LiFE) initiative promotes sustainable practices and responsible consumption.

Chapter 11: Social Development, Employment, and Human Capital

India has made notable progress in social infrastructure, focusing on health, education, housing, and sanitation. Government initiatives in rural connectivity and microfinance have significantly improved living standards. Emphasis is placed on gender equality and sustainable employment growth, with regulatory reforms recommended to shift towards outcome-driven policies in health and education.

Chapter 12: Employment and Workforce Development

India’s labor market experienced strong recovery post-pandemic, with the unemployment rate falling from 6% in 2017-18 to 3.2% in 2023-24. Improvements in labor force participation and worker-to-population ratios indicate a positive trend. The government prioritizes reskilling and upskilling programs to align the workforce with global demands, supporting the vision of Viksit Bharat 2047.

Chapter 13: Artificial Intelligence and Labor Market Dynamics

This chapter explores the impact of artificial intelligence (AI) on employment, emphasizing the need for policies to manage workforce transitions. While AI presents vast opportunities, infrastructure limitations and skill gaps remain challenges. Strategic investments in education and workforce training can enable AI to drive inclusive growth rather than job displacement.

Key Takeaways from the Economic Survey 2024-25

• India’s economy remains resilient, with GDP growth projected at 6.5% for FY25.

• Inflation is stable, though food price fluctuations require close monitoring.

• Trade expansion and FDI reforms continue to bolster the external sector.

• Industry and services growth is driven by deregulation and business-friendly policies.

• Infrastructure, agriculture, and digital advancements are crucial for long-term growth.

• AI, automation, and climate policies will shape India’s future workforce and economy.

MoMSME Introduces TEAM Initiative to Strengthen MSME Digital Footprint

The Ministry of Micro, Small, and Medium Enterprises (MoMSME) has unveiled the MSME Trade Enablement and Marketing (TEAM) Initiative, designed to elevate the online presence of small businesses across India. This initiative, backed by a ₹277.35 crore budget over three years, aims to integrate 5 lakh micro and small enterprises into the digital marketplace, with a particular focus on women entrepreneurs. Implemented in partnership with the Open Network for Digital Commerce (ONDC), this program seeks to democratize e-commerce access in India.

By incorporating small businesses into the ONDC ecosystem, the TEAM Initiative aims to remove operational challenges, enhance credibility, and unlock new growth opportunities for MSMEs in the digital economy.

Shubhanshu Shukla: India’s First Astronaut to Pilot Axiom-4 to ISS

India is set to achieve another milestone in space exploration as Group Captain Shubhanshu Shukla prepares to become the first Indian astronaut to pilot a mission to the International Space Station (ISS). He has been selected as the pilot for Axiom Mission 4 (Ax-4), a privately funded spaceflight scheduled for launch in the spring of 2025. This marks a historic moment in India’s space journey, building upon the legacy of Rakesh Sharma’s iconic mission 40 years ago.

ISRO Successfully Launches SpaDeX Mission for Space Docking

In a major leap for India’s space program, ISRO has successfully launched the SpaDeX mission to test space docking capabilities—an essential technology for future space missions. The PSLV-C60 rocket, which lifted off from the Satish Dhawan Space Centre (SDSC SHAR) on December 30, 2024, carried two small spacecraft, SDX01 (Chaser) and SDX02 (Target), into low-Earth orbit. With this achievement, India joins Russia, the US, and China in mastering autonomous docking and undocking systems.

RBI’s Key Findings from the Banking Sector Report (2023-24)

1. Improved Asset Quality

Indian banks have recorded their lowest gross non-performing assets (NPA) ratio in 12 years, dropping to 2.5% as of September 2024. This decline is attributed to better recovery mechanisms, the write-off of bad loans, and improved asset management strategies.

2. NPA Forecast

The Reserve Bank of India (RBI) projects that the gross NPA ratio may rise to 3% by March 2026 under normal conditions and could escalate to 5.3% in a high-risk scenario. However, banks are expected to maintain adequate capital buffers to absorb financial shocks.

3. Strong Credit Growth and Economic Expansion

The banking sector witnessed a 19% increase in credit growth during 2023-24, driven by rising loan demand in infrastructure, housing, and personal finance sectors.

4. Digital Transformation in Banking

India’s banking industry is experiencing a rapid shift toward digital transactions, with significant growth in mobile and online banking. The RBI’s digital currency pilot programs further highlight this transformation, boosting financial accessibility and customer convenience.

5. Strong Capital Reserves

Indian banks maintain a robust Capital-to-Risk-Weighted Assets Ratio (CRAR) of 16.8% as of September 2024, well above the regulatory requirement of 9%, ensuring stability in the financial system.

6. Surge in Banking Frauds

A concerning rise in banking fraud cases was reported in the first half of FY25, prompting RBI to consider stricter security measures to mitigate risks.

2024 National Sports Awards Recipients

Major Dhyan Chand Khel Ratna Award 2024

Awarded for outstanding sports performance over the past four years.

1. Gukesh D (Chess)
2. Harmanpreet Singh (Hockey)
3. Praveen Kumar (Para-Athletics)
4. Manu Bhaker (Shooting)

China Reports Surge in Human Metapneumovirus (HMPV) Cases

China is witnessing a sharp increase in human metapneumovirus (HMPV) infections, sparking concerns about a potential public health crisis. Hospitals are overwhelmed with cases linked to HMPV, influenza A, Mycoplasma pneumoniae, and COVID-19. Identified in 2001, HMPV primarily affects children, the elderly, and individuals with weakened immune systems. However, Chinese authorities have not yet declared an emergency.

Highlights from the 82nd Golden Globe Awards (2025)

The 82nd Golden Globe Awards took place on January 5, 2025, at The Beverly Hilton in Beverly Hills, California, celebrating excellence in film and television. Notable winners included Adrien Brody (Best Actor in a Motion Picture – Drama for The Brutalist) and Zoe Saldaña (Best Supporting Actress for Emilia Pérez). Nikki Glaser made history as the first solo female host of the Golden Globes.

PM Inaugurates Z-Morh Tunnel, Enhancing Kashmir-Ladakh Connectivity

On January 13, 2024, Prime Minister Narendra Modi inaugurated the Z-Morh tunnel, ensuring year-round access between Kashmir and Ladakh. This strategically significant tunnel bypasses landslide-prone areas, improves connectivity to Sonamarg, and is expected to enhance winter tourism while strengthening military logistics in the region.

Devastating Wildfires in Southern California – January 2025

Southern California experienced a severe wildfire outbreak in January 2025, with flames ravaging Los Angeles and surrounding areas. The disaster displaced 130,000 residents, caused 10 fatalities, and even delayed the Oscars nominations.

Reasons for the Intensity of Wildfires

1. Dry Conditions Following Wet Weather – Heavy rainfall in 2022-23 led to excessive vegetation growth, which later dried up due to an exceptionally dry 2024 winter, creating a fire hazard.
2. Santa Ana Winds – These strong, dry winds rapidly spread the flames across vast areas.
3. Climate Change – Rising global temperatures have extended and intensified wildfire seasons.

Authorities have deployed aircraft to drop pink fire retardant to contain the flames, though concerns are being raised about its environmental impact.

Revised Appointment Process for India’s Election Commissioners

The Chief Election Commissioner and Other Election Commissioners (Appointment, Conditions of Service, and Term of Office) Act, 2023, introduces key reforms to enhance transparency in appointing Election Commissioners.

Key Changes

1. Selection Committee Formation – A three-member panel now oversees appointments, comprising:

   • The Prime Minister
   • A Cabinet Minister (nominated by the PM)
   • The Leader of the Opposition in the Lok Sabha

2. Role of the Search Committee – This committee, led by the Law Minister, identifies suitable candidates for consideration.

3. Inclusion of External Candidates – The selection process now allows candidates from outside the existing Election Commission pool.

4. Supreme Court Influence – The judiciary advocated for a more balanced appointment process, leading to the inclusion of opposition representation in the selection committee.

These reforms strengthen the Election Commission’s independence and credibility.