Current Affairs – June 01-02, 2025

{GS2 – IR – Asia} UK Handed Over Chagos Islands to Mauritius

• Context (TH): United Kingdom (U.K.) officially handed over sovereignty of the Chagos Islands to Mauritius after finalising the political treaty agreed to last year.

• Under the deal, the important naval and bomber base on Diego Garcia, one of the archipelago’s largest island, operated by U.S. forces, will be leased by the U.K. from Mauritius which will maintain sovereignty over the region.

Chagos Islands

• The Chagos archipelago is a group of seven atolls in the Indian Ocean, comprising at least 60 islands about 500 km south of the Maldives and more than 2000 km northeast of Mauritius.
• Chagos Islands are the southernmost archipelago of the Chagos–Laccadive Ridge, a long submarine mountain range in the Indian Ocean.
• Key Islands: Salomon Islands, Diego Garcia, Nelsons Island, etc.
• The Great Chagos Bank is the largest atoll in the world.
• The Chagos Islands, including Diego Garcia, house a critical US military base in the Indian Ocean.

History of Chagos Islands

• 1793: French established coconut plantations in the islands off approximately 1000 km from Maldives.
• 1814: A set of 8 atolls i.e. ring-shaped islands, totalling sixty islands – Peros, Salomon, Nelsons, Three Brothers, Eagle, Danger, Egmont and Diego Garcia along with Mauritius and Seychelles were handed over to the British empire in 1814.
  • These islands were constituted as the British Indian Ocean Territory (BIOT) along with the islands of Aldabra, Desroches and Farquhar
• 1965: The islands of Aldabra, Desroches and Farquhar which were later ceded to Seychelles during its independence in June 1976.
• 1967: U.K. envisaged the use of Chagos island as a military base. Roping the United States (U.S.) as a partner in 1967, the U.K. allowed the U.S. to use Diego Garcia for defence purposes for 50 years.
• 1968: Mauritius gained freedom from the British and U.K paid a £3 million grant in recognition of the detachment of the Chagos Archipelago from Mauritius.

Fight Over Chagos

• Mauritius Claim of sovereignty: Since its independence, Mauritius has claimed sovereignty over Chagos, claiming that the U.K. was in violation of UN resolutions which banned dismemberment of colonies before independence.
• Declaration of Marine Protected Area by UK: In 2010, U.K. asserted its sovereignty over BIOT by declaring the area as a ‘Marine Protected Area’ (MPA).
  • However, Mauritius challenged this move in the Permanent Court of Arbitration (PCA).
• PCA Judgement (2015): The declaration of MPA was not compatible with U.K’s obligations under the UN convention on the Law of the Sea. However, the court refused to settle the sovereignty issue between the two nations, claiming it did not have jurisdiction.
• International Court of Justice (2019): Decolonisation of Mauritius was not lawfully completed following the separation of Chagos and that the U.K is obligated to end its administration of Chagos as rapidly as possible.
• United Nations General Assembly (UNGA): In 2019, it passed a resolution urging the UK to withdraw from Chagos within six months.

Read More> India’s Stand on Chagos Islands.

{GS2 – Polity – IC} Demand for including Kokborok & Bhojpuri in 8^th Schedule

• Context (IE): Demand for inclusion of Kokborok and Bhojpuri languages in the Eighth Schedule of IC.

About Eighth Schedule

• Eighth Schedule to the IC lists the languages officially recognised by the GoI.
• Part XVII of the Indian Constitution (Articles 344(1) & 351) deals with the Eighth Schedule.
• 22 languages have been classified under the Eighth Schedule to the Constitution.

• 14 originally listed: Assamese, Bengali, Gujarati, Hindi, Kannada, Kashmiri, Malayalam, Marathi, Odia, Punjabi, Sanskrit, Tamil, Telugu, and Urdu.
• Sindhi language was added by the 21st Amendment Act of 1967.
• Konkani, Manipuri, and Nepali were included by the 71^st Amendment Act of 1992.
• Bodo, Dogri, Maithili, and Santhali were added by the 92^nd Amendment Act of 2003.
• English, despite its widespread use & role in official spheres, has never been part of the Eighth Schedule.
• There is no fixed criteria for any language to be considered for inclusion in the Eighth Schedule.
  • Ashok Pahwa Committee (1996) and Sitakant Mohapatra Committee (2003) suggested criteria for inclusion of any language in the Eighth Schedule.

Except Pali and Prakrit, all Classical Languages are listed in Eighth Schedule of the Constitution.

Benefits of being listed in the Eighth Schedule

• Languages listed in the Eighth Schedule are eligible for translation services in Parliament if spoken by any member.
• National Sahitya Akademi recognizes the languages of the Schedule as literary languages by default.
• Included as options in the Indian language paper for the UPSC examinations.
• Receive developmental funds from central government, as language falls under the Concurrent List.

Official Language Commission

• Set up in 1955 under Article 344(1) of the IC, which mandates its establishment by the President.
• Reviews the progress of language use, makes recommendations for improvement, reports to the President, and advises on language policy.

Article 351 provides for promoting the spread of the Hindi language so that it may serve as a medium of expression for all the elements of the composite culture of India and by enriching it through assimilating into it the forms, style and expressions used in the languages specified in the Eighth Schedule.

Kokborok Language

• Kokborok is a Sino-Tibetan language of the Bodo–Garo branch.
• It is related to the Bodo and Dimasa languages of neighbouring Assam.
• Kókborok consists of several dialects spoken in Tripura.

{GS3 – Envi – Conservation} Kumram Bheem Conservation Reserve

• Context (TH): Telangana declared the tiger corridor area connecting the Kawal Tiger Reserve in the State with the Tadoba-Andhari Tiger Reserve in Maharashtra as ‘Kumram Bheem Conservation Reserve’.

• Area: It spans a total area of 1,492 sq km.
  • The area is a critical part of the wildlife corridor connecting Kawal with not only Tadoba but also Kanhargaon, Tipeshwar, and Chaprala wildlife sanctuaries in Maharashtra, as well as the Indravati Tiger Reserve in Chhattisgarh.
• Fauna: Tigers, leopards, wild dogs, sloth bears, wolves, hyenas, honey badgers, jungle cats, sambar, nilgai, chital, four-horned antelopes, muntjacs, etc.
  • More than 240 bird species have made it home, including the Malabar Pied Hornbills and Long Billed Vulture – for which it is the only nesting site.

Conservation Reserve

• The State government may declare any areas owned by it, particularly those adjacent to national parks and sanctuaries, as well as areas that link one protected area with another, as a conservation reserve.
  • There is the precondition of having consultation with the local communities.
• Legal Basis: Section 36(A) of the Wildlife Protection Act, 1972.
  • Introduced in the Wildlife (Protection) Amendment Act of 2002.
• Objective: To protect landscapes, seascapes, flora, fauna, and their habitat.
  • People’s participation is encouraged through local communities.
• Conservation Reserve Management Committee: The act mandates the State Government to constitute a CRMC to advise the Chief Wildlife Warden to conserve, manage & maintain conservation reserve.
• Activities: Regulated low-impact activities; hunting and habitat destruction are banned.

Read More> Protected Areas

{GS3 – Envi – PA} First-ever Tiger Safari in Palamau Tiger Reserve

• Context (IE): Jharkhand plans to establish its 1^st tiger safari in the fringe area of Barwadih Western Forest Range within Palamau Tiger Reserve.

What is a Tiger Safari?

• It is a controlled wildlife enclosure within protected areas like national parks or sanctuaries designed for viewing rescued, injured, or orphaned tigers.
• Objective: To promote wildlife conservation, environmental education, and local employment while easing tourism pressure on core tiger habitats.
• The concept was first envisaged in the Guidelines for Tourism issued by the National Tiger Conservation Authority (NTCA) in 2012.

Legal Framework

• Tiger Safari are not defined under the Wildlife (Protection) Act, 1972.
• Construction inside sanctuaries requires approval from the National Board for Wild Life (NBWL).
• National Tiger Conservation Authority (NTCA) guidelines, 2016 permit the establishment of tiger safaris in buffer and fringe zones for conflict, rescued and zoo-bred tigers (permitted under Central Zoo Authority supervision).
• SC, in 2024, directed that tiger safaris be established outside core & buffer areas of tiger reserves.

Palamau Tiger Reserve

• Located on the western Chotanagpur Plateau, spanning Latehar & Garhwa districts in Jharkhand spannig an area of 1129.93 sq km. It is the only tiger reserve in the state of Jharkhand.

• Part of Betla National Park, it was among the first nine tiger reserves established under the Project Tiger initiative in 1973.
• Site of the world’s first tiger census in 1932 using pugmark tracking (technique for identifying and monitoring tigers by their footprints).
• The geological formation consists of gneiss and includes granite and limestone. The region is drought-prone but rich in minerals, such as bauxite and coal.
• Crossed by three rivers: North Koyal, Auranga, and Burha (the only perennial river).
• Flora: Dominated by moist and dry deciduous forests, primarily Sal & bamboo.
• Fauna: Royal Bengal tiger, Asiatic elephant, leopard, grey wolf, dhole (wild dog), gaur (Indian bison), sloth bear, and four-horned antelope.

Also Read,> National Parks of India with Map (109 National Parks in India in 2023)

{GS3 – IE – Banking} RBI’s Draft Directions on Gold Loans

• Context (TH | IE): RBI released draft guidelines to standardise gold loan lending by banks & Non-Banking Financial Companies (NBFCs). It will come into effect from January 1, 2026.
• Objective of the guidelines: Harmonise norms across lenders, ensure responsible lending, and protect financially weaker sections.

Key Draft Proposals

• Loan-to-Value (LTV): Capped at 75% for consumption-based bullet loans; accrued interest is included in LTV, thus reducing disbursed amounts.
• Proof of Ownership: Loans cannot be extended against gold whose ownership is doubtful.
• Gold Valuation for collateral purposes: Based on the 30-day average of 22-carat gold price with standardised purity checks.
• Loan Restrictions:
  • No concurrent loans (e.g., for both consumption and income generation) on the same collateral.
  • Renewals/top-ups allowed only if the existing loan is classified as standard and within LTV norms.
• Repayment & Repledging: Fresh loans are allowed only after full repayment (principal + interest).
  • Repledging by NBFCs is banned.
  • Collateral must be returned within 7 working days of loan repayment; failure attracts ₹5,000/day penalty.
• Financial Gold Exclusion: Loans against gold exchange-traded funds (ETFs), Sovereign Gold Bonds (SGBs), and gold mutual funds are not permitted.

LTV ratio is calculated by dividing the loan amount by the value of the gold jewellery or coin. Bullet loan: Where both the principal amount and the interest are due at the date of maturity.

Why did the RBI Intervene?

• Irregularities in lending: Excessive top-ups and concurrent loans, especially among NBFCs.
• Transparency: Repledging of pledged gold, raising concerns about asset security and transparency.
• Credit risk: inconsistent valuation norms, increasing credit risk and borrower vulnerability.

Impact Analysis

On NBFCs and Lending Institutions

• Reduced operational flexibility, especially on loan renewals and top-ups.
• Higher compliance burden due to ownership proof, purity checks, and LTV tracking.
• Liquidity strain for smaller NBFCs reliant on gold repledging.
• May lead to market consolidation and a rise in interest rates to offset higher operational costs.

On Borrowers

• Rural and small borrowers may face reduced access due to:
  1. Smaller loan amounts for the same gold.
  2. Stricter conditions on renewals and fresh disbursement.

Also Read,> Reserve Bank of India (RBI)

{GS3 – IE – Development} India Releases Provisional GDP Estimates

• Context (IE): The National Statistics Office, Ministry of Statistics and Programme Implementation (MoSPI) released the Provisional Estimates (PE) of Annual GDP for the FY 2024-25.

• Annual GDP PE are compiled using the Benchmark-indicator method i.e., the estimates available for the previous FY 2023-24 are extrapolated using the relevant indicators reflecting the performance of sectors.

Key Highlights

GDP

• Nominal GDP (GDP at Current Prices): Estimated to attain a level of ₹330.68 lakh crore in the FY 2024-25, showing a growth rate of 9.8%.
  • The growth of the nominal GDP is less than 10% at 9.8%, FY25’s growth is the 6^th slowest growth rate in nominal GDP since India liberalised its economy in 1991.
• Real GDP (GDP at Constant Prices): Estimated to attain a level of ₹187.97 lakh crore in FY 2024-25, registering a growth rate of 6.5%.
  • CAGR of real GDP now stands at just above 5% since 2019. India’s economy has lost its growth momentum over the past decade, with the CAGR being just above 6% since 2014.
• Gap Between the Real & Nominal GDP: Shows the effect of inflation in prices of goods and services.

Credit: Indian Express

Gross Value Addition (GVA) & Sectoral Health Of Economy

• Nominal GVA: Estimated to attain a level of ₹300.22 lakh crore during FY 2024-25, showing a growth rate of 9.5%.
• Real GVA: Stood at ₹171.87 lakh crore, growing by 6.4% compared to ₹161.51 lakh crore in the previous fiscal.

Manufacturing Growth

• Slower Manufacturing Growth: Since 2019-20, manufacturing GVA has registered a slower growth rate (CAGR of 4.04%) than even agriculture and allied activities (4.72%).
• It explains the high urban youth unemployment in India. Also provides an understanding of why labour has been moving back to Indian villages and joining agriculture and allied activities.

Services Sector

• The services sector also witnessed a slight deceleration, with trade, hotels, transport and communication as well as the financial, real estate and professional services segments growing at a slower pace than before.

Primary Sector

• It has seen 4.4% growth rate as compared to growth rate of 2.7% observed in previous financial year.
• Agriculture continued to expand at a healthy pace, driven by favourable weather conditions and remunerative prices, which induced farmers to sow more area.
  • Agriculture sector grew at 4.6% in FY 2024-25 compared to 2.7% in FY 2023-24.

Industry

• The industrial sector, though, slowed sharply, weighed down by manufacturing. The sector grew at just 4.5% in 2024-25, down from 12.3% the year before.

Other

• Private Final Consumption Expenditure (PFCE): Reported 7.2% growth rate during FY 2024-25 as compared to 5.6% growth rate in the previous financial year.
• Gross Fixed Capital Formation (GFCF): Recorded 7.1% growth rate during FY 2024- 25 and 9.4% growth rate in Q4, FY 2024-25

How is national income measured?

• Economic Growth: Measured using two metrics.
  1. Gross Domestic Product (GDP): Calculated by adding up all the expenditures made in the economy, including expenditures by Indians in their individual capacity, expenditures by governments, expenditures by private businesses, etc. This provides a picture of the demand side of the economy.

2. Gross Value Added (GVA): looks at the supply side. It effectively measures the contribution of each sector of the economy by calculating and summing the value added (or income) at each stage of production.
   • GVA captures the true momentum of the Indian economy; providing insight into the health of each sector as it excludes the effects of taxes and subsidies, which can distort GDP figures.

• GDP and GVA are Linked: They measure the same economic performance but through different routes. Their relationship can be spelled out using the following equation:

  GDP = (GVA) + (taxes earned by government) — (subsidies provided by government)

• MoSPI provides GDP and GVA data both in nominal terms (in present day prices) and real terms (after taking away the effect of inflation). Both nominal and real data have their own analytical significance.
  • While the size of the economy uses nominal GDP data, international comparisons of growth rate are done based on the growth rate of real GDP.
  • This is because inflation differs from country to country, and only real GDP provides a genuine understanding about how many actual new goods and services were produced in a particular year.

{GS3 – IE – Urbanisation} Urban Challenge Fund

• Context (IE): In Budget 2025-26, Finance Minister announced Urban Challenge Fund. The government has allocated Rs 10,000 crore for the first year (2025-26).
• Aim: To implement the proposals for ‘Cities as Growth Hubs’, ‘Creative Redevelopment of Cities’, and ‘Water and Sanitation.’

What is the Urban Challenge Fund?

• Urban Challenge Fund (UCF) is a flagship government initiative worth Rs 1 lakh crore aimed at transforming urban India by encouraging sustainable, innovative urban development.
• The three core thematic areas are:
  1. Cities as Growth Hubs: Making cities productive and efficient centers of economic activity.
  2. Creative Redevelopment of Cities: Addressing issues like congestion by refurbishing and redeveloping existing urban areas.
  3. Water and Sanitation: Modernizing urban infrastructure to improve public health and environmental sustainability.
• Funding Mechanism: It will finance up to 25% of cost of bankable projects, with the condition that at least 50% of the project cost should come from bonds, bank loans, and Public-Private Partnerships (PPPs).
  • Rs 10,000 Cr has been allocated for the first year (2025-26).

Need of the Fund

• Rising urban population: About 31.1% (27.7% in 2001) of India’s population live in urban areas. (2011 Census). By 2036, over 600 million people are projected to live in Indian cities.
• To address urban challenges like overcrowding, inadequate infrastructure, water scarcity, pollution, & housing shortages.
• Financing Gap: Local bodies contribute only about 15% to urban infrastructure. Private investment accounts for a mere 5%.

How Does the UCF Address These Challenges?

• Financing Model: By funding 25% of project costs, UCF incentivizes cities to raise the remaining 75% through bonds, loans, and PPPs, encouraging market participation.
• Encouraging Innovation: The “Creative Redevelopment” aspect focuses on refurbishing congested areas and promoting sustainable, efficient urban design.
• Infrastructure Focus: Prioritizes critical sectors like water and sanitation, addressing pressing public health and environmental needs.
• Capacity Building: Supports the development of qualified urban planners and modern governance frameworks for better project execution.

{GS3 – S&T – AI} The MANGO Paradox – India’s Missed AI Opportunity

• Context (IE): MANGO is an acronym for Meta, Anthropic, Nvidia, Google, and OpenAI. The article uses a metaphorical comparison to explore why India exports AI talent instead of cultivating global AI leadership domestically.

MANGO Paradox: Factors Responsible

• Brain Drain: India has the highest AI skill penetration rate (2.8x the global average). However, this talent overwhelmingly migrates to the West, driven by better opportunities & infrastructure.
  • 65% of leading US AI firms have Indian-origin leaders.
• Funding and R&D Deficit: India’s R&D spend is ~0.7% of GDP (3% in the US and 2.4% in China).
• ‘Services over Innovation’: Indian IT giants (TCS, Infosys, Wipro) focus on services, not innovation. There is no Indian equivalent to OpenAI or DeepMind — companies driving AI frontiers.

• Infrastructure and Hardware Gap: India’s top AI supercomputer, AIRAWAT, has 656 GPUs, compared to 10,000+ in use by companies like Meta and OpenAI. IndiaAI Mission aims to expand this to 18,000 GPUs.

IndiaAI Mission aims to boost AI development and innovation in India. It was launched as a joint initiative between the Meity and NASSCOM in 2023.

• Risk-Averse Mindset: Indian VCs currently prefer low-risk, quick-return investments, limiting support for capital-intensive AI ventures.

Impact on India

• Lost Economic Opportunity: India risks missing out on AI’s $15.7 trillion global economic contribution.
• Talent Drain: AI brain drain fuels innovation abroad while India gets left behind in terms of IP generation, product leadership, and unicorn formation.
• Geopolitical & Strategic Dependence: Lack of sovereign AI capability makes India reliant on foreign tech companies for critical AI infrastructure and applications — a national security concern.

Way Forward

• Build Domestic AI Compute Infrastructure: Invest in indigenous chip design, expand data centers, and establish GPU leasing/sharing.
• Reverse Brain Drain and Enhance Talent Ecosystem: Offer AI fellowships, returnee incentives, and create world-class AI Centres of Excellence at IITs and IISc to retain and attract top talent.
• Boost R&D Investment and Innovation Funding: Raise India’s R&D spending to 1.5% of GDP by 2030 and launch national AI research grants focused on foundational AI research to drive long-term innovation.
• Expand Risk-Tolerant Capital and Promote Product-First Startups: Encourage sovereign AI innovation funds and co-investment with VCs in deep tech startups and incentivizing IP-led AI startups.

{Prelims – Awards} National Florence Nightingale Awards 2025

• Context (PIB): President conferred the National Florence Nightingale Awards 2025.

About National Florence Nightingale Award

• Instituted in the Year: 1973. Named after Florence Nightingale, pioneer of modern nursing.
• Established by: Ministry of Health and Family Welfare
• Purpose: To honour registered nurses, ANMs, LHVs, and other public health service workers for meritorious and selfless service.
• Award constitutes: Cash prize (₹1,00,000), Medal and Certificate of Merit
• Eligibility: Auxiliary Nurse Midwives (ANMs), Staff Nurses, Lady Health Visitors (LHVs), Healthcare workers from government, UTs, and voluntary organisations.
• Selection Criteria: Nominated by States/UTs and institutions and evaluated by expert panels on service impact, innovation, dedication, and public health contribution.

Florence Nightingale Florence Nightingale was an English social reformer, statistician, and the founder of modern nursing. She gained prominence during the Crimean War by managing and training nurses to care for wounded soldiers in Constantinople. Her pioneering work in nursing education led to the establishment of the Nightingale School of Nursing at St. Thomas’ Hospital in London, the first scientifically based nursing school. She was the 1st women to be awarded the Order of Merit.

{Prelims – S&T – Defence – Exercises} Nomadic Elephant

• Context (PIB): 17^th edition of India-Mongolia Joint Military Exercise Nomadic Elephant is to be conducted at Ulaanbaatar, Mongolia.

• Exercise Nomadic Elephant is an annual event conducted alternately in India and Mongolia. 16^th edition of the exercise was conducted at Umroi, Meghalaya in 2024.
• Objective: To enhance interoperability between the two forces while employing joint task force in semi conventional operations in semi urban/ mountainous terrain under United Nations mandate.

{Species – Reptiles – Misc} Calotes zolaiking

• Context (TH): Calotes zolaiking, a garden lizard, recorded for the 1^st time in Meghalaya.

• Though this species was first described from Mizoram in 2019, its recent sighting in East Khasi Hills has extended its known range by over 170 kilometers.

Credit: TH

• It is a rare species of arboreal agamid lizard endemic to India.
• Distribution: It is currently found in Mizoram and Meghalaya.
• Habitat: Terrestrial
• Physical Description: Approximately 5 inches; strongly keeled, giving a sharp appearance; Dorsal scales are heterogeneous and composed of medium-sized, weakly pointed scales.
• Colouration: The colouration in life varies but is primarily mottled shades of light and darker brown dorsally, with four distinct, lighter transverse stripes on the body.
• Behaviour: Diurnal; capable of rapid movement on the ground and swimming.

Calotes Calotes, a genus of arboreal (tree-dwelling) lizards of the family Agamidae, are remarkable for their extreme colour changes when excited. India is home to 14 species of Calotes, 9 of which have been recorded in the Northeast.