Banking Awareness of 29, 30 and 31 January 2026

Topic: Indian Economy/Financial Market

1. According to Statistics Ministry, factory output growth rate increased to 7.8% in December.

• This is a 25-month high level of factory output growth rate, based on the Index of Industrial Production (IIP).
• The Ministry said the growth was driven by increase in manufacturing, mining and electricity.
• Manufacturing output increased 8.1% year-on-year in December 2025.
• This was much higher than the growth (3.7%) seen in December month last year.
• Industries including ‘computer, electronic and optical products (34.9%), motor vehicles, trailers and semi-trailers (33.5%) and other transport equipment (25.1%) recorded very strong growth.
• Mining production increased 6.8% in December and power generation increased 6.3% in December 2025.
• India's industrial production growth declined to 3.9% during the April-December of FY26.
• Most use-based segments showed faster growth in December compared to November. Consumer durables expanded to a 13-month high of 12.3%.
• Capital goods and Infrastructure and construction goods growth declined compared to November.
• IIP growth increased to a six-quarter high of 5.2% in Q3 FY26.
• GDP growth for the quarter is projected at around 7.1–7.2%. IIP growth may slow to 6–7% in January 2026, partly due to an unfavourable base effect.

Topic: Indian Economy/Financial Market

2. India’s Innovation Performance strengthened and Global Innovation Index Rank improved: Economic Survey 2025–26.

• On 29 January, the Economic Survey 2025-26 was tabled in Parliament by Union Minister for Finance and Corporate Affairs, Smt Nirmala Sitharaman.
• India’s innovation performance was highlighted as steadily strengthening, with the Global Innovation Index (GII) rank improving from 66th in 2019 to 38th in 2025.
• It was noted that India now ranks first among lower-middle-income countries and also holds the top position in the Central and Southern Asia region in the Global Innovation Index.
• The Production Linked Incentive (PLI) Scheme, launched in 2020 under the vision of Aatmanirbhar Bharat, was expanded to 14 key sectors with a total outlay of ₹1.97 lakh crore.
• Till September 2025, actual investments exceeding ₹2 lakh crore were realised under the PLI Scheme.
• This led to incremental production and sales of more than ₹18.70 lakh crore and employment generation of over 12.60 lakh people.
• Cumulative incentives of ₹23,946 crore were disbursed across 12 sectors, while 806 applications were approved across all 14 sectors under the scheme.
• Exports crossing ₹8.20 lakh crore were recorded under the PLI framework, with electronics, pharmaceuticals, and telecom and networking products contributing significantly.
• The National Manufacturing Mission announced in the Union Budget 2025–26 was described as a foundational policy blueprint to accelerate industrial growth and enhance global competitiveness over the next decade.
• To finance innovation at scale, a Research, Development and Innovation (RDI) Fund with an outlay of ₹1 lakh crore over six years was announced, with ₹20,000 crore allocated for FY26.
• The establishment of the Anusandhan National Research Foundation under the ANRF Act, 2023 was highlighted as a major institutional reform.
• It is intended to provide strategic direction and competitive funding across industry, academia and government.
• India emerged as a significant global player in Intellectual Property (IP), ranking 4th in trademarks, 6th in patents and 7th in industrial designs in global filings during 2024.
• Patent applications nearly doubled between FY20 and FY25, while trademark registrations grew 1.5 times and design registrations increased 2.5 times.
• Bengaluru, Delhi and Mumbai were listed among the world’s top 50 most innovation-intensive clusters, reflecting a marked growth in India’s overall innovation output.
• The World Intellectual Property Organization (WIPO) ranked India 12th globally for entrepreneurship policies and culture.
• Since the launch of the Startup India initiative in 2016, the number of startups recognized by DPIIT has increased from approximately 500 to over 200,000 by 2025.

Topic: Indian Economy/Financial Market

3. India ranked among Top Five Countries for Private Infrastructure Investment: Economic Survey 2025–26.

• Infrastructure was reaffirmed as central to India’s growth strategy, with sustained increases in public capital expenditure highlighted in the Economic Survey 2025–26.
• The institutionalization of multimodal planning through PM GatiShakti, supported by the National Logistics Policy and digital platforms, was credited with reducing transaction costs and execution risks.
• The World Bank ranked India among the top five countries globally in terms of private investment in infrastructure among low- and middle-income economies.
• India emerged as the largest recipient of private participation in infrastructure investment in South Asia, accounting for over 90% of the regional total.
• Government capital expenditure increased nearly 4.2 times from ₹2.63 lakh crore in FY18 to ₹11.21 lakh crore in FY26 (BE), positioning infrastructure as a key growth driver.
• Effective capital expenditure in FY26 (BE) was estimated at ₹15.48 lakh crore, reflecting the strong multiplier impact of infrastructure investments on the economy.
• India’s infrastructure financing landscape was described as diversifying beyond bank credit, with NBFC credit to the commercial sector growing at a CAGR of 43.3% during FY20–FY25.
• Infrastructure Investment Trusts (InvITs) and Real Estate Investment Trusts (REITs) were highlighted as playing an increasing role in mobilising long-term institutional capital.
• The national highway network expanded by around 60% from 91,287 km (FY14) to 1,46,572 km (FY26, up to December).
• While operational high-speed corridors increased nearly ten-fold from 550 km (FY14) to 5,364 km (FY26, up to December).
• Railway infrastructure expansion continued, with the rail network reaching 69,439 route kilometres and electrification achieving 99.1% by October 2025.
• India became the world’s third-largest domestic aviation market, with the number of airports rising from 74 in 2014 to 164 in 2025.
• Indian ports achieved near-global standards in efficiency, with seven ports featuring among the top 100 in the World Bank’s Container Port Performance Index 2024.
• The power sector witnessed continuous capacity expansion, with installed capacity increasing by 11.6% (year-on-year) to 509.74 GW by November 2025.
• Power sector reforms resulted in a historic turnaround, with DISCOMs recording a positive profit after tax of ₹2,701 crore in FY25 for the first time.
• Renewable energy capacity rose more than threefold over the last decade, reaching 253.96 GW by November 2025 and accounting for nearly half of total installed capacity.

Topic: Indian Economy/Financial Market

4. Agricultural Productivity boosted through inputs, mechanisation and market support: Economic Survey 2025–26.

• Productivity enhancements in agriculture were attributed to both in situ and post-harvest interventions, as outlined in the Economic Survey 2025–26.
• Launched in 2014–15, the Sub-Mission on Seeds and Planting Materials (SMSP) ensured access to high-quality seeds, benefiting over 2.85 crore farmers through the creation of 6.85 lakh seed villages.
• A National Mission on High-Yielding Seeds was announced in the Union Budget 2025–26 to promote climate-resilient varieties and improve commercial seed availability.
• The government promotes micro-irrigation under the PDMC program by providing financial assistance of 55% to small and marginal farmers and 45% to other farmers for installing drip and sprinkler systems.
• As a result, expansion of irrigation facilities increased the gross irrigated area from 41.7% in 2001–02 to 55.8% in 2022–23.
• To improve soil health, the Soil Health Management (SHM) and Soil Health Card (SHC) schemes were implemented under the National Project on Management of Soil Health and Fertility.
• This promoted integrated nutrient management by combining chemical fertilizers with organic manure and bio-fertilizers.
• As of November 14, 2025, more than 25.55 crore cards have been issued.
• Fertiliser management reforms such as neem-coated urea and Aadhaar-linked point-of-sale verification improved transparency and nutrient efficiency.
• Farm mechanisation was promoted through the establishment of 25,689 Custom Hiring Centres, improving access to modern equipment.
• Agricultural marketing infrastructure was strengthened through storage and post-harvest projects supported under AMI and AIF schemes.
• Launched in April 2016, e-NAM is a pan-India virtual market platform to improve price discovery and competition.
• By December 2025, it connected 1.79 crore farmers, 2.72 lakh traders, and 4,698 FPOs across 1,522 mandis in 23 states and 4 UTs.
• Minimum Support Prices continued to be fixed at 1.5 times the cost of production for 22 mandated crops.
• Income support through assured prices and schemes like PM-KISAN has strengthened farm incomes and agricultural growth.
• Since its launch, over ₹4.09 lakh crore has been released to more than 11 crore farmers in 21 instalments.
• Agricultural credit disbursement crossed ₹28.69 lakh crore in FY25, surpassing the annual target.

Topic: Indian Economy/Financial Market

5. As per Economic Survey 2025-26, India’s GDP growth for FY26 is estimated at 7.4% and is driven by consumption and investment.

• India continues to be the fastest-growing major economy for the fourth year in a row.
• The Survey was presented in Parliament by Finance and Corporate Affairs Minister Nirmala Sitharaman on 29 January 2026.
• The Survey projects real GDP growth of 6.8 to 7.2 per cent in FY27.
• Rural consumption has remained steady due to good agricultural performance.
• Overall consumption growth has been broad-based.
• Gross fixed capital formation is estimated at 30 per cent of GDP.
• Capital formation grew by 7.6 per cent in the first half of FY26.
• Agriculture and allied activities are estimated to grow by 3.1 per cent in FY26.
• Agricultural GVA increased by 3.6 per cent in the first half of FY26.
• Manufacturing grew by 8.4 per cent in the first half of FY26.
• The manufacturing sector’s share of the economy stayed around 17 to 18 per cent.
• Industrial growth is expected to rise to 6.2 per cent in FY26.
• Services continue to be the largest contributor to growth. Services GVA rose by 9.3 per cent in the first half of FY26.
• Most service sub-sectors recorded growth above 9 per cent.
• Growth has been accompanied by easing inflation, which has improved real purchasing power.
• Headline CPI inflation declined to 1.7 per cent.
• Core inflation showed some persistence due to higher precious metal prices.
• Direct taxes reached nearly 53 per cent of annual targets by November 2025.
• Nearly 60 per cent of the budgeted capital outlay was utilised by November 2025.
• S&P upgraded India’s sovereign rating to BBB. and CareEdge Global assigned India a BBB+ rating.
• The repo rate was reduced by 125 basis points since February 2025.
• Lending rates on fresh loans declined noticeably and gross NPAs fell to multi-decade lows.
• India’s exports reached a record USD 825.3 billion in FY25. Export momentum continued into FY26.
• The services trade surplus offset the merchandise trade deficit.
• Four Labour Codes replaced 29 central labour laws as part of labour reforms.
• Inflation is at historically low levels and rebasing of the CPI will affect inflation analysis.
• GDP growth for FY27 is projected at 6.8 to 7.2 per cent. This suggests steady growth despite global uncertainty.

Topic: Indian Economy/Financial Market

6. The Economic Survey 2025–26 said that a sharp improvement has been seen in the asset quality of Scheduled Commercial Banks.

• Both gross NPAs and net NPAs have fallen to their lowest levels in several decades.
• The capital adequacy position of SCBs remains strong, with a CRAR of 17.2 percent as of September 2025.
• The overall NPA recovery rate of SCBs increased from about 13 percent in FY18 to over 26 percent in FY25.
• Union Budget 2025–26 measures expanded the flow of credit to MSMEs.
• The upward revision of MSME investment and turnover limits further supported credit growth.
• Regional Rural Banks' number declined from 196 to 28 by May 2025.
• RRBs recorded a record consolidated net profit of ₹6.8 thousand crore in FY25.
• Public sector banks launched a digital Credit Assessment Model for MSMEs in 2025.
• Between April and November 2025, over ₹41.5 thousand crore of MSME loans were sanctioned under this system.
• A regulatory review cell was set up to reassess all regulations every five to seven years.
• The microfinance sector continues to focus on underserved segments.
• Women account for about 95 percent of borrowers. Rural clients form around 80 percent.
• Over 55 crore bank accounts were opened under PM Jan Dhan Yojana by March 2025.
• The share of adults with bank accounts rose from 35 percent in 2011 to 89 percent in 2021.
• The RBI’s Financial Inclusion Index increased to 67.0 in March 2025. It stood at 64.2 in March 2024.
• Creditors realised nearly ₹4 lakh crore from resolved insolvency cases.
• S&P Global Ratings upgraded India’s insolvency regime in December 2025 from Group C to Group B.

Topic: Indian Economy/Financial Market

7. The Economic Survey 2025–26 highlighted that real industry GVA increased by 7.0 percent year on year in the first half of FY2025–26.

• Industry GVA growth had slowed to 5.9 percent in FY2024–25.
• Manufacturing GVA grew by 7.72 percent in the first quarter and by 9.13 percent in the second quarter.
• Firms are gradually moving toward higher-value production.
• Medium- and high-technology industries now account for 46.3 percent of total manufacturing value added.
• India’s Competitive Industrial Performance ranking reached to 37th in 2023 from 40th in 2022.
• Credit growth from commercial banks slowed to 8.24 percent from 9.39 percent in FY24.
• Non-bank funding to the commercial sector grew and recorded a CAGR of 17.32 percent between FY20 and FY25.
• India remained the world’s second-largest producer of steel. It also retained the second position in cement production.
• Coal production reached record levels in FY25, with coal output touching 1,047.52 million tonnes.
• The chemicals and petrochemicals sector contributed 8.1 percent to manufacturing GVA in FY24.
• Vehicle production rose by nearly 33 percent between FY15 and FY25.
• India’s electronics sector moved from seventh place in FY22 to the third-largest export category in FY25.
• Mobile phone manufacturing played a central role. Production value expanded nearly thirty times over a decade.
• India supplies about 20 percent of global generic medicines.

Topic: Indian Economy/Financial Market

8. Economic Survey 2025-26 states that rural employment has been a key part of India’s social protection system for nearly two decades.

• According to Economic Survey 2025-26, participation of women increased steadily from 48 per cent in FY14 to 58.1 per cent in FY25.
• Mahatma Gandhi National Rural Employment Guarantee Scheme (MGNREGA) has provided wage employment since its launch in 2005.
• It stabilised rural incomes and created basic infrastructure by providing up to 100 days of guaranteed unskilled work to rural households.
• Rural employment needs have changed over time. The change is brought by increasing incomes, enhanced connectivity, widespread digital adoption, and diversified livelihoods.
• This emphasises both the programme’s achievements and the need to reassess its design and aims.
• Administrative and technological reforms have strengthened the scheme.
• The Aadhaar-Based Payment System is widely used. Electronic wage payments are nearly universal.
• However, structural challenges remain as monitoring shows work is sometimes not completed and expenditure does not always match physical progress.
• Other issues are the use of machinery in labour-intensive works, bypass of digital attendance systems and misappropriation of funds over time.
• These show the limits of the current system.
• Against this backdrop, Viksit Bharat- Guarantee for Rozgar and Ajeevika Mission (Gramin) Act, 2025 has been enacted. It is also referred to as VB G-RAM G Act, 2025.
• As per the Survey, VB G-RAM G Act, 2025 marks a major shift in India’s rural employment policy.