Daily Current Affairs

Why in News? The Narcotics Control Bureau (NCB) busted an international drug trafficking syndicate and seized 227.7 kg of Captagon worth around ₹182 crore. A Syrian national was arrested during the operation named “Operation Ragepill.” Key Highlights Major Seizure First-ever seizure of Captagon in India. Total drugs seized: 31.5 kg from Delhi’s Neb Sarai 196 kg from Mundra Port, Gujarat Estimated value: ₹182 crore Arrest Syrian national Alabras Ahmad arrested. He entered India on a tourist visa in November 2024. Visa expired in January 2025; he was staying illegally. Smuggling Route Drugs were allegedly being routed: Syria → India → Saudi Arabia & West Asia Captagon tablets were hidden inside: a chapati-cutting machine a shipment declared as sheep wool What is Captagon? About Captagon is a synthetic stimulant drug. Main ingredient: Fenethylline Produces: high alertness euphoria reduced fatigue Why Called “Jihadi Drug”? Reportedly abused in conflict zones and by extremist groups in West Asia. Linked to illegal drug networks in the Middle East. Operation Ragepill Conducted by the Narcotics Control Bureau. Based on intelligence shared by a foreign drug law-enforcement agency. Demonstrates growing international cooperation against narcotics trafficking. Government Statement Amit Shah reiterated the government’s policy of “Zero Tolerance Against Drugs” and emphasized the vision of a Drug-Free India. Exam Relevance Prelims Captagon Fenethylline NCB International drug trafficking routes Operation Ragepill Mains Internal Security / International Relations India as a transit point for narcotics Challenges of transnational organized crime Need for global cooperation in anti-drug operations

What happened? India has rejected a reported award issued by the Court of Arbitration (CoA) at The Hague regarding hydroelectric projects on the Indus river system. The dispute mainly concerns the Kishenganga and Ratle hydroelectric projects being built by India. India stated that it does not recognise the tribunal as legally constituted and therefore considers all its decisions “null and void.” Background: The Indus Waters Treaty The Indus Waters Treaty was signed in 1960 between India and Pakistan with the World Bank as a mediator. River Allocation India: Ravi, Beas, Sutlej (Eastern Rivers) Pakistan: Indus, Jhelum, Chenab (Western Rivers) India is allowed limited use of western rivers for: Hydropower generation Irrigation Non-consumptive purposes Why is Pakistan objecting? Pakistan challenged the design features of: Kishenganga Hydroelectric Project Ratle Hydroelectric Project The main issue is “pondage” — the amount of water that can be stored temporarily in run-of-river hydroelectric plants. Pakistan argues: India’s designs may allow excessive water control. This could affect downstream water flow into Pakistan. What is the Court of Arbitration (CoA)? The CoA is a five-member arbitration panel constituted in 2023 at Pakistan’s request. India refused to participate because: India believes the matter is technical, not legal. Under the treaty, technical disputes should first go to a Neutral Expert. A Neutral Expert process was already underway through the World Bank. India argues that running both mechanisms simultaneously violates the treaty framework. India’s Position External Affairs Ministry spokesperson Randhir Jaiswal said: The tribunal is “illegally constituted.” Any award issued is invalid. India’s decision to keep the treaty “in abeyance” remains effective. India has increasingly argued that: Pakistan repeatedly uses dispute mechanisms to delay Indian projects. The treaty needs modification due to changed geopolitical and security realities. What did the tribunal reportedly decide? According to reports: The tribunal interpreted treaty provisions largely in Pakistan’s favour. It reportedly restricted how India calculates permissible pondage. It narrowed India’s design flexibility for run-of-river projects. This could potentially limit operational freedom for future Indian hydropower projects. Why is this important? 1. India-Pakistan Relations Water-sharing is one of the few long-standing agreements that survived multiple wars and crises between the two countries. 2. Strategic Importance Hydroelectric projects in Jammu & Kashmir are strategically important for: Energy generation Regional development Water management 3. Treaty Interpretation Conflict The case highlights a deeper disagreement over: Who has jurisdiction? How disputes should be resolved? Whether treaty mechanisms can run simultaneously. Key Terms Pondage Temporary water storage used to regulate flow for hydropower generation. Run-of-River Project A hydropower plant that generates electricity without creating a large reservoir. Neutral Expert A technical specialist appointed under the treaty to resolve engineering/design disputes. Exam Relevance UPSC / State PCS Topics Covered: India-Pakistan relations International water treaties International arbitration Hydroelectric power Indus river system Possible Questions Discuss the significance of the Indus Waters Treaty in India-Pakistan relations. Why has India objected to the Court of Arbitration on the Indus dispute? Explain the concept of pondage in run-of-river hydropower projects.

1. Context Retail Hikes: Petrol and diesel prices hiked by ₹3 per litre across all variants. Compressed Natural Gas (CNG) prices increased by ₹2 per kg. Historical Context: This marks the first major retail fuel price hike (defined as >₹1/litre) in over four years, since the staggered ₹9 hike following the March 2022 Russia-Ukraine conflict. New Base Rates (Delhi): * Regular Petrol: ₹97.77 / litre Regular Diesel: ₹90.67 / litre 2. Fiscal Measures: Windfall Tax Adjustments Simultaneously, the Central Government restructured the windfall gains tax regime to regulate outbound shipments and domestic availability: Petrol Exports: New windfall tax of ₹3 per litre imposed. Diesel Exports: Levy reduced to ₹16.5 per litre. Aviation Turbine Fuel (ATF): Levy reduced to ₹16 per litre. 3. Under-Recoveries & OMC Financial Strain The Macro Loss: Prior to this decision, State-run Oil Marketing Companies (OMCs like IOCL, BPCL, HPCL) were bearing combined losses of approximately ₹1,000 crore per day across petrol, diesel, and LPG. Global Catalysts: Severe upstream financial pressure caused by global crude oil spikes, soaring freight rates, and supply-chain re-routing born out of the ongoing conflict in West Asia. The Fiscal Gap: Structural under-recoveries stood at ₹13–15/litre for petrol and ₹17–18/litre for diesel. Experts note the ₹3 hike is only a partial buffer; a ₹10 per litre hike is required to bridge even 50% of the OMCs' true under-recoveries. 4. Strategic Multi-Dimensional Impact Consumer Inflation Risks: While a ₹3 hike offers a breather to corporate OMC balance sheets, it introduces cascading input-cost pressures across logistics, public transport, and agricultural supply chains. Demand-Side Management: Aligns with the political executive’s recent public push urging citizens to voluntarily curb fuel consumption to ease India's high crude import bill. The "Export vs Domestic" Balance: Imposing a windfall tax on petrol exports acts as a regulatory disincentive for domestic refiners private or public to prioritize lucrative international markets over domestic fuel pumps during a global energy crunch. What is Windfall Tax? A windfall tax is a higher, temporary tax levied by a government on specific companies or industries that have experienced sudden, exceptionally high, and unexpected profits. These extraordinary gains are called "windfalls" because they do not result from any strategic investment, expansion, or sudden business innovation by the company itself. Instead, they are entirely driven by external economic shocks or geopolitical events beyond the company's control. 1. Why Do Governments Impose It? Redistributing Excess Wealth: It ensures that companies profiting massively from a crisis contribute a fair portion back to the economy, rather than keeping all the gains. Funding Public Relief: The extra revenue generated is often channeled directly into funding public welfare programs, infrastructure development, or consumer subsidies to ease the burden of the crisis on the general public. Fiscal Balancing: It provides governments with emergency revenue during times of crisis (such as wars or high import bills) without having to raise regular taxes on ordinary citizens.

1. The Core Ruling (May 2026) Judicial Decision: The Indore Bench of the Madhya Pradesh High Court ruled that the disputed 11th-century Bhojshala-Kamal Maula Mosque complex in Dhar is a Hindu temple dedicated to Goddess Vagdevi (Saraswati). Quashing of 2003 Order: The court struck down the April 2003 Archaeological Survey of India (ASI) arrangement that divided access (Hindus on Tuesdays/Basant Panchami; Muslims on Fridays). Exclusive Worship Rights: The Hindu community has been granted continuous daily rights to perform worship rituals at the site; Friday namaz is no longer permitted. 2. Key Legal & Scientific Evidence ASI Scientific Survey: The judgment relied heavily on a multi-volume ASI report utilizing advanced techniques (carbon dating, GPR, XRF spot analysis, and palaeography). Structural Findings: The survey concluded that the current standing structure was constructed centuries later using the dismantled, recycled remains of an 11th-century monumental complex from the Paramara dynasty. Recovered Artefacts: Excavations revealed sculptures and iconography representing Hindu deities (Ganesha, Brahma, Narasimha, Hanuman, Krishna) alongside Jain Tirthankara imagery. Reused basalt pillars showed Arabic/Persian inscriptions carved on older temple components. Historical Continuity: The court recorded that the site historically served as a Bhojshala (a prominent center for Sanskrit learning) under Raja Bhoj, and noted that the continuity of Hindu worship at the site had never been legally extinguished. 3. Key Directives Issued by the Court Administration & Upkeep: The court handed over full supervisory control, conservation, and regulation of religious access to the ASI and directed the Central Government to manage the site as a Bhojshala temple and Sanskrit learning center. Repatriation of the Deity: The Union Government has been directed to consider active representations to bring back the original Pratima (idol) of Goddess Saraswati/Vagdevi, currently housed in the British Museum in London, and re-establish it at the site. Alternate Land for Mosque: To secure religious equity, the court stated that the state government may consider allocating an alternate, suitable piece of land within Dhar district for the Muslim community to construct a mosque. 4. Constitutional & Jurisprudential Grounding Articles 25 & 26 Alignment: The Bench noted that under the Constitution, the State has an obligation to protect ancient monuments of historical and spiritual significance, including the preservation of the sanctum sanctorum and the purity of the deity. Ayodhya Principles: The 242-page judgment drew from the 10 principles of the Supreme Court's Ram Janmabhoomi verdict, reiterating that courts can safely rely on multidisciplinary, transdisciplinary archaeological studies when determining the historical character of a site. Rejection of the 1935 Proclamation: The court dismissed the Muslim side's reliance on a 1935 official proclamation (Ailaan) by the princely State of Dhar naming it a mosque, noting it lacked legal validity as the site was already a protected monument under the 1904 Ancient Monuments Preservation Act.

1. Event Overview Context: Prime Minister Narendra Modi’s state visit to the UAE (Abu Dhabi) as part of a 5-nation tour (including the Netherlands, Sweden, Norway, and Italy). Geopolitical Stance: India explicitly condemned recent regional attacks on the UAE, praising its "restraint" and offering support for regional peace efforts. 2. Key Pillar: Strategic Energy Security To fortify India's energy cushions against external shocks, the Abu Dhabi National Oil Company (ADNOC) and Indian Strategic Petroleum Reserves Ltd. (ISPRL) signed two major MoUs: Strategic Reserves: Agreement for storing up to 30 million barrels of crude oil in India's underground strategic reserves. Reciprocal Storage: Exploration of potential Indian crude oil storage facilities within the UAE. Supply Stability: Concluded pacts on long-term LNG (Liquefied Natural Gas) supplies to diversify India’s fuel basket. 3. Key Pillar: Strategic Defence Cooperation Framework An institutional framework proposed during January was officially concluded to upgrade the bilateral security relationship: Industrial & Tech Alliance: Deepened collaboration in defence manufacturing, technology transfer, and joint industrial production. Operational Interoperability: Increased scale of joint military exercises, specialized training, and special forces operations. Modern Security Domains: Enhanced intelligence sharing and coordination in maritime security, cyber-defence, and information exchange. 4. Key Analytical Takeaways The "West Asia" Pivot: Amid the broader West Asia crisis (which dragged down India's regional trade volumes in April 2026), these pacts show India actively using deep bilateral diplomacy to insulate its vital energy supply lines. Strategic Depth via Storage: Relying on the UAE to fill India's commercial and strategic petroleum reserves provides a cushion against price volatility and transit chokepoint disruptions. Beyond Buyer-Seller Relations: The shift from simple oil procurement to joint defence manufacturing and cyber-warfare capabilities marks a transition from a transactional relationship to a comprehensive strategic partnership.

India’s April 2026 merchandise exports grew 14% to $43.6B. Driven by market diversification and strong services, the overall trade deficit fell 30% to $7.8B. Trade Performance 1. Data Merchandise Trade: Exports grew ~14% to $43.6 billion (vs $38.3B in April 2025); Imports rose to $71.9 billion. Services Trade: Exports jumped to $37.2 billion; Imports marginally dipped to $16.7 billion. Net Deficit: The overall trade deficit (Goods + Services) shrank by 30% to $7.8 billion, thanks to a strong services surplus cushioning the goods deficit. 2. Core Trends & Drivers Price Effect: Rising global commodity prices artificially boosted the nominal value of exports. Supply Resilience: Industry successfully maintained domestic supply chains despite global maritime bottlenecks. Market Diversification: Exporters hedged risks by shifting focus to non-traditional and historically smaller destinations. 3. Shift in Export Destinations India recorded massive growth spikes in alternate markets to counter traditional slowdowns: Asia-Pacific & Neighborhood: Sri Lanka (+215%), Singapore (+179%), Bangladesh (+64%), and Vietnam (+53%). Africa: Exports to Tanzania surged 158% to reach $1.2 billion. 4. Geopolitical Shock: West Asia Crisis Regional conflict heavily depressed trade volumes along traditional Middle Eastern/Red Sea routes: Exports to West Asia: Dropped 28% to $4.16 billion. Imports from West Asia: Fell 31.6% to $10.5 billion (reflecting lower/disrupted energy and raw material inflows). 5. Key Takeaways Services as a Macro Buffer: The widening gap in merchandise trade is systematically absorbed by India's structural strength in service exports, keeping the overall external balance stable. Volume vs. Value: Growth driven by global price inflation is a temporary cushion. Long-term export stability requires scaling up real cargo volumes, lowering logistics overheads, and expediting bilateral trade pacts. Transit Vulnerabilities: The sharp drop in West Asian trade underlines India's extreme exposure to strategic maritime chokepoints, stressing the urgency for viable, multi-modal transport corridors.

The recently released Periodic Labour Force Survey (PLFS) 2025 highlights important changes in India’s employment situation. Every year, nearly 7–10 million young Indians enter the labour market, making job creation and skill development critical for the country’s economic future. According to the report, India’s Labour Force Participation Rate (LFPR) reached 59%, while the unemployment rate remained low at 3%. Youth unemployment has also declined compared to 2024, showing improvement in both rural and urban areas. One of the biggest positive trends is the rise in women’s participation in the workforce. Female labour participation, especially in rural areas, increased steadily during 2025. The report also shows improvement in the quality of jobs, as regular salaried employment increased from 22% to 24%, while dependence on self-employment slightly declined. Women’s earnings also improved across salaried jobs, self-employment, and casual labour. However, gender wage gaps still remain a major concern. Women continue to earn less than men in most sectors. The report also points towards structural changes in the economy. Agriculture’s share in employment has declined, while manufacturing and services are creating more opportunities, especially for young people and women. Despite these positive developments, several challenges continue: Many graduates still struggle to find jobs after completing higher education. Only a small percentage of people have formal vocational or technical training. Women often leave the workforce because of childcare and household responsibilities. Around 25% of youth aged 15–29 belong to the NEET category (Not in Education, Employment, or Training). Experts suggest that India must focus on skill development, apprenticeships, women-friendly workplace policies, and expansion of stable salaried jobs to fully utilise its demographic dividend. Why is this important? Shows India’s employment and unemployment trends Highlights progress in women’s workforce participation Explains challenges in job creation and skill training Important for understanding India’s demographic dividend Key Points PLFS 2025 shows unemployment rate at 3%. Labour Force Participation Rate reached 59%. Women’s participation in workforce improved. Manufacturing and services sectors are growing. Skill gaps and NEET youth remain major concerns.

Evika Siliņa resigned as the Prime Minister of Latvia after her coalition government lost its majority in Parliament. The political crisis began when the left-leaning Progressives party withdrew support from the ruling coalition. This happened after Defence Minister Andris Sprūds was removed from his position following controversy over stray Ukrainian drones entering Latvian airspace. The drone incidents raised concerns about national security and border protection in Latvia, which shares regional security concerns because of the ongoing Russia-Ukraine conflict. Evika Siliņa’s resignation is significant because it comes only a few months before Latvia’s general elections. Political analysts believe the incident may affect public opinion and increase pressure on the next government to strengthen defence and security policies. Why is this important? Shows political instability in Latvia before elections Highlights security concerns linked to the Russia-Ukraine war Raises questions about airspace monitoring in European countries May influence Latvia’s future defence policies Key Points Latvian PM Evika Siliņa resigned. Coalition lost majority after partner party withdrew support. Defence Minister Andris Sprūds was removed over drone controversy. Ukrainian drones reportedly entered Latvian airspace. Resignation comes before Latvia’s general elections.

External Affairs Minister S. Jaishankar strongly criticised unilateral sanctions imposed by countries outside the United Nations framework during the BRICS Foreign Ministers’ Meeting held under India’s chairmanship. His remarks came as India awaits the decision of the United States on extending the waiver that allows India to continue importing Russian crude oil despite U.S. sanctions on Russia. Speaking at the BRICS meeting, Jaishankar said that sanctions not approved by the United Nations are “unjustified” and negatively affect developing countries. He stressed that dialogue and diplomacy are better solutions than pressure and coercive measures. The meeting was attended by Russian Foreign Minister Sergey Lavrov and Iranian Foreign Minister Abbas Araghchi, representing two countries heavily affected by U.S. sanctions. According to global shipping data, India’s imports of Russian oil increased sharply in May 2026. Indian refiners are buying more Russian oil because supplies from West Asia are facing disruptions due to tensions around the Strait of Hormuz. Reports suggest Russian oil imports reached around 1.96 million barrels per day in May, compared to 1.57 million barrels per day in April. The U.S. had earlier granted temporary waivers allowing countries like India to import oil from Russia and Iran due to the ongoing West Asia conflict. However, the waiver for Iran has already ended, and the Russian oil waiver is expected to expire soon. India has traditionally opposed unilateral sanctions that are not approved by the United Nations. At the same time, India also balances its foreign policy and energy needs carefully to protect national interests and ensure stable oil supplies for its large population. Why is this important? Highlights India’s independent foreign policy Shows the importance of energy security for India Reflects global tensions affecting oil markets Demonstrates BRICS cooperation on international issues Key Points India criticised non-UN sanctions at the BRICS meeting. S. Jaishankar called unilateral sanctions unjustified. India is waiting for the U.S. decision on the Russian oil waiver. Russian oil imports by India increased in May 2026. West Asia tensions are affecting global energy supplies.