1. U.S. Deports 200 Indians on Military Plane
Context:
- The U.S. has deported around 200 Indian nationals using a military aircraft.
- The move comes ahead of a scheduled visit by Indian Prime Minister Narendra Modi to the U.S.
- This follows discussions between Modi and U.S. President Donald Trump regarding illegal immigration.
Key Points:
- Reason for Deportation:
- The Trump administration has intensified actions against illegal immigration.
- The U.S. Department of Homeland Security (DHS) has increased border security and deportation efforts.
- Verification Process:
- The Indian side confirmed the nationality of all deported individuals before the U.S. authorities proceeded.
- The Indian government is “duty-bound” to take back its citizens staying abroad illegally.
- Diplomatic Angle:
- The deportation indicates a continuing dialogue between the U.S. and India on immigration policies.
- India’s External Affairs Minister S. Jaishankar met U.S. Secretary of State Marco Rubio to discuss the issue.
- Trump’s Stance on Immigration:
- Donald Trump emphasized that Modi would support the repatriation of illegal Indian immigrants.
- Immigration policy has been a key part of Trump’s administration and election campaign.
- Policy Implications:
- The move highlights the U.S. crackdown on illegal immigrants from multiple countries.
- It raises concerns about the legal status of Indian migrants in the U.S.
- Statistics:
- There are an estimated 18,000 illegal Indian immigrants in the U.S.
DHS has removed or returned over 1,60,000 individuals globally since June 2024.
2. China Hits Back at U.S. with Tariffs & Probes into Google
Context
- The trade war between the U.S. and China intensified as China retaliated against U.S. tariffs.
- The U.S. had imposed sweeping tariffs on Chinese goods, prompting China to respond with countermeasures.
China’s Countermeasures
Tariffs on U.S. Goods
- 15% tariffs on coal and liquefied natural gas (LNG).
- 10% tariffs on crude oil, agricultural machinery, big-engine vehicles, and pickup trucks.
Justification by China
- Response to the U.S.’s “unilateral tariff hike.”
- China accused the U.S. of violating World Trade Organization (WTO) rules.
- China planned to file a WTO complaint against U.S. tariffs.
Impact on Trade
- China is a major importer of U.S. energy (coal, LNG).
- China’s import from Russia ($94 billion) dwarfs its imports from the U.S. ($7 billion).
- Trade war disrupts global economic stability and supply chains.
Investigation into U.S. Tech Companies
- Google: Suspected of violating China’s Anti-Monopoly Law.
- PVH Corp. (owns Calvin Klein, Tommy Hilfiger) added to China’s “unreliable entities” list.
- Illumina (biotech firm): Also under investigation.
- Probes aimed at safeguarding national sovereignty and security.
Stock Market & Economic Impact
- Indian stock market (Sensex) rebounded after the U.S. paused tariffs on Canada & Mexico.
- China imposed export controls on rare metals & chemicals (tungsten, tellurium, bismuth, molybdenum).
U.S. Perspective
- Trump administration aimed to punish nations failing to curb illegal migration & drug flow into the U.S.
Planned talks between U.S. President and Chinese President Xi Jinping.
3. Strengthening Investment in School Education
Context
- The Union Budget 2025 has increased allocations for education, particularly in school education and higher education.
- The ASER 2024 report highlights gaps in foundational literacy and numeracy (FLN).
- The National Education Policy (NEP) 2020 aims to reform the education system, focusing on early education and holistic learning.
Key Highlights of Budget 2025 in Education
- Increased Allocations
- School education: ₹11,000 crore additional funds (+16% increase from 2024-25 revised estimates).
- Total allocation to school education: 55% of the budget (only a 0.12 percentage point increase).
- Higher education allocation: Unchanged at 99% of the budget.
- Major Announcements
- AI Centre of Excellence for education (₹500 crore allocation).
- Broadband connectivity for schools.
- Expansion of five third-generation IITs.
- Increased funding for Indian knowledge systems.
Challenges in Education Sector
- Higher Education Issues
- Ambitious UGC reforms (four-year degrees, bi-annual admissions, multi-institutional courses) require significant financial investment.
- Funding burden falls mostly on State governments.
- Budget does not fully address financial constraints in higher education.
- School Education & FLN Gaps
- The ASER 2024 report highlights gaps in foundational literacy and numeracy (FLN).
- COVID-19 learning losses recovered, but achieving full FLN by 2026-27 (NIPUN Bharat target) still remains a challenge.
- Early education (up to Class 3) is crucial, but:
- First two years before Class 1 are managed by Anganwadi workers, who are underpaid & lack training.
Government Policies & Implementation
- The National Education Policy (NEP) 2020 promotes a 5+3+3+4 system, emphasizing 5 years of early education.
- Kendriya Vidyalaya Sangathan & States receiving higher funding for implementation.
- A focused FLN drive is needed for skill development and demographic dividend utilization.
Way Forward
- Increase financial support to States for implementing NEP and UGC reforms
- Strengthen Anganwadi training & wages to improve early education outcomes.
- Monitor FLN progress to achieve NIPUN Bharat’s 2026-27 target.
- Expand digital education initiatives like broadband for schools.
Ensure sustainable funding for long-term education sector reforms.
4. Cess and Surcharge Impact on States' Tax Share
Context
- The Union Government collects a significant portion of taxes as cesses and surcharges, which are not part of the divisible tax pool shared with the States.
- This has led to a declining share of States in central taxes, disproportionately affecting southern States.
Key Issues
- Shrinking Divisible Pool of Taxes
- Cesses & surcharges are not included in the divisible tax pool, reducing the amount available for States.
- In FY 2021-22, the Centre’s collection from cesses & surcharges reached ₹13.5 per ₹100 of tax revenue (highest in a decade).
- Expected to decline to ₹10.97 per ₹100 in FY 2025-26 (BE).
- Declining Share of Southern States
- Southern States’ share in the divisible pool has declined:
- Kerala: 3.08% (FY02) → 2.50% (FY20) → 1.9% (FY26 BE).
- Tamil Nadu: 5.46% (FY17) → 4.02% (FY26 BE).
- Karnataka: 4.98% (FY02) → 3.6% (FY26 BE).
- Andhra Pradesh & Telangana: 7.7% (FY02) → 6.75% (FY26 BE).
- Odisha’s share has increased, while Madhya Pradesh, Maharashtra, Rajasthan, and Bihar saw a reduction.
- Reasons for Decline in State Shares
- Finance Commission formula considers:
- Population control efforts (disadvantages States with declining populations).
- Demographic & economic performance.
- Efficiency in tax collection.
- Forest cover & area.
- Some States argue that the formula is biased and politically motivated.
- GST Compensation Cess & Fiscal Issues
- GST compensation cess was meant to compensate States for GST losses but was not included in tax devolution.
- States have been struggling with revenue shortages due to GST implementation.
Implications
- Financial strain on States, especially those implementing better population control.
- Greater fiscal dependence on the Centre, weakening federalism.
- Potential increase in regional inequalities, as States with lower shares struggle with welfare programs.
Way Forward
- Re-evaluating the cess & surcharge mechanism to ensure a fair share for States.
- Reforming Finance Commission formulas to balance development & fiscal needs.
- Strengthening State revenue generation through better taxation policies.
