RBI Grade B Current Affairs — 4 October 2026

India's budget allocation for the Department of Agriculture and Farmers Welfare has risen more than fivefold, from ₹27,663 crore in 2013-14 to ₹1,40,528.78 crore in 2026-27. This reflects a sustained policy shift toward agricultural modernisation, rural credit expansion, and farmer income support. The increase spans flagship schemes including PM-KISAN, PM Fasal Bima Yojana, and the Agricultural Infrastructure Fund, all of which are tested directly in RBI, NABARD, and UPSC competitive examinations.

The fivefold jump in the agriculture ministry's budget over 13 years is not simply a fiscal number — it represents a structural transformation in how India finances its agrarian economy. Three distinct policy levers have driven this expansion.

First, direct income support: PM-KISAN (launched 2019) transfers ₹6,000 per year in three instalments directly to farmer bank accounts, making it one of the largest DBT programmes globally. This is a fiscal mechanism the RBI examiner connects to financial inclusion and priority sector lending targets.

Second, risk coverage: PM Fasal Bima Yojana and the Restructured Weather Based Crop Insurance Scheme protect farm income against weather shocks. NABARD's role in refinancing these credit-linked products is a recurring exam angle.

Third, infrastructure and credit: The Agricultural Infrastructure Fund (AIF) with a corpus of ₹1 lakh crore, and NABARD's own refinancing mandate, bridge the credit gap in post-harvest and rural logistics infrastructure.

For UPSC, this budget trajectory connects to GS-III themes of food security, agricultural subsidies versus investment, and inclusive growth. The examiner's test beneath this number is whether the aspirant understands the delivery mechanism — DBT, cooperative credit, crop insurance — not just the headline allocation. The shift from input subsidies to direct benefit transfers, and from ad-hoc relief to structural insurance, is the conceptual spine of modern Indian agricultural policy.

The Reserve Bank of India has revised its shareholding rules, allowing mutual funds, insurers, and pension funds to obtain a single one-time approval for subsequent purchases of bank shares up to a 10% stake. Previously, these institutional investors needed fresh regulatory clearance for each incremental acquisition. The revised framework eases compliance burden for long-term institutional investors while keeping the 10% ceiling intact, ensuring RBI oversight without repeated approval cycles for every transaction.

Bank shareholding norms in India are governed by RBI's licensing and ownership guidelines, which distinguish between different categories of shareholders — promoters, non-promoter major shareholders, and passive institutional investors like mutual funds, insurance companies, and pension funds.

The core regulatory concern is preventing concentration of control in banks by non-banking entities. RBI prescribes tiered approval thresholds: acquiring beyond certain percentage stakes in a private bank requires prior RBI approval. This protects systemic stability and ensures fit-and-proper ownership.

Under the earlier regime, even incremental purchases by institutional investors — who typically hold shares for passive investment, not control — required fresh approval each time they crossed or approached regulatory thresholds. This created procedural friction for large fund houses whose portfolios naturally fluctuate with market purchases.

The revised rule introduces a one-time approval mechanism: once RBI grants approval for a mutual fund, insurer, or pension fund to hold up to 10% in a bank, subsequent purchases within that ceiling do not need fresh clearance. The 10% cap itself remains unchanged — it is the approval process that has been streamlined.

For exam purposes, this is a regulatory circular anchored in RBI's power under the Banking Regulation Act, 1949, specifically provisions governing acquisition of shares in banking companies. The key distinction is between the threshold (10%) and the approval mechanism (one-time vs. repeated), which is precisely how the examiner frames withheld-datum questions.

The Indian government has extended the RoDTEP scheme — which refunds embedded taxes and duties on exported goods not captured by other mechanisms — until 31 December 2026. Announced on 2 October 2026, the extension ensures exporters continue receiving rebates on levies like electricity duties, mandi taxes, and fuel costs embedded in supply chains. RoDTEP replaced the earlier MEIS scheme after WTO compliance concerns and has been operational since January 2021.

RoDTEP stands for Remission of Duties and Taxes on Exported Products. It is a demand-side export promotion scheme administered by the Ministry of Commerce and Industry. Its core purpose is to refund taxes and levies borne by exporters that are not rebated through any other mechanism — such as GST input tax credits or duty drawback. These include state-level levies like electricity duties, mandi taxes, stamp duties on export documents, and the central fuel tax embedded in transportation costs.

RoDTEP replaced the Merchandise Exports from India Scheme (MEIS) in January 2021. MEIS was found to be non-compliant with WTO rules because it provided subsidies linked to export performance, which the WTO Agreement on Subsidies and Countervailing Measures (ASCM) prohibits. RoDTEP, by contrast, only remits taxes actually paid — making it WTO-compliant.

Benefits are issued as transferable electronic scrips credited to the exporter's ledger account on the ICEGATE portal, administered by CBIC. These scrips can be used to pay basic customs duty or transferred to other importers.

The extension to 31 December 2026 signals continuity of India's export support architecture during a period of global trade uncertainty. For UPSC and NABARD aspirants, the key static knowledge is the WTO compliance angle, the replacement of MEIS, and the mechanism of scrip-based rebate delivery. For RBI aspirants, the trade financing and current account implications — reducing exporters' embedded cost burden — are the relevant connection.

India's MEA Consultative Committee met to review India-Russia relations, with two issues dominating: India's peace proposals for the Ukraine conflict and the structural imbalance in bilateral trade. Discussions highlighted India's continued diplomatic engagement as a neutral party while also addressing the challenge of expanding two-way trade beyond energy imports. India has sought balanced trade growth, including greater Russian investment and market access for Indian goods to correct the widening trade deficit.

India's position on the Ukraine conflict rests on three diplomatic pillars: respect for sovereignty and territorial integrity under the UN Charter, dialogue and diplomacy over war, and opposition to unilateral sanctions not endorsed by the UN Security Council. India has abstained on multiple UN General Assembly resolutions condemning Russia, framing this as strategic autonomy rather than endorsement of aggression. Prime Minister Modi's visits to both Kyiv and Moscow in 2024 underscored India's ambition to be a credible peace broker rather than a passive bystander.

On the trade side, the India-Russia relationship has been dramatically reshaped since 2022. Russia became India's top crude oil supplier by 2023, but this created a lopsided trade relationship — India's imports from Russia far outpace exports. Bilateral trade surpassed $65 billion in 2023-24, but the imbalance is structural: India buys oil, defence equipment, and fertilizers while Russia's market remains hard to penetrate for Indian exporters. Payment settlement is another friction point, as Western sanctions restrict dollar-denominated transactions, pushing both sides toward rupee-rouble trade or third-currency arrangements.

The MEA Consultative Committee is a parliamentary mechanism — not a cabinet body — that briefs Members of Parliament on foreign policy matters. Its deliberations signal what India's diplomatic establishment considers its active foreign policy priorities, making it a useful barometer for exam-setters tracking India's foreign policy posture.