8th August 2025 Current Affairs: Economy, Climate & Key Updates

Catch up on the most important 8th August 2025 current affairs — from economic trends and climate rulings to health news and diplomatic moves. Perfect for UPSC and competitive exams!

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1.Is the Indian economy perfectly balanced?

📰 Why It’s in the New?

A recent editorial published in The Hindu questions whether India’s economy is “perfectly balanced.” It explores how India’s high GDP growth rate and stable macroeconomic indicators coexist with persistent structural challenges such as inflation, inequality, and supply chain inefficiencies.

📌 Key Points for Prelims & Mains

➤ Economic Growth Trends:

• India registered real GDP growth of 7.8% in Q1 FY 2025-26, driven by private consumption (55% of GDP) and government capex.

• The Economic Survey 2024-25 projected growth at 7%–7.5%, supported by resilient domestic demand and stable financial sector performance.

➤ Macro-Economic Stability:

• Inflation (CPI) eased to 4.1% in July 2025, within the RBI’s target range (2%-6%) but food inflation remains volatile due to climate impacts.

• Fiscal deficit is estimated at 5.1% of GDP in FY26 (BE) — better than COVID-era levels, but still above FRBM targets.

• Current Account Deficit (CAD) narrowed to 1.2% of GDP, aided by a surge in services exports and remittances.

➤ Structural Challenges:

• Jobless Growth: Unemployment remains high, particularly in the youth segment (Urban youth unemployment rate ~13% as per CMIE).

• Agricultural inefficiencies: Supply chain bottlenecks continue; over 85% of farmers are small/marginal with limited market access.

• Income and regional disparities: Southern and western states continue to outperform the BIMARU states, exacerbating development gaps.

🌍 Recent Developments & Global Context

• Global Headwinds: Fed rate hikes paused in Q2 2025 but uncertainty remains. Oil prices have stabilized at $80–85/barrel range.

• China slowdown and EU stagnation impacting India’s merchandise exports (declined by 2.3% YoY in Q2 FY26).

• Positive domestic indicators: Manufacturing PMI stays above 55 since April 2025, indicating robust domestic activity.

• Easing global supply chains have helped reduce input costs for Indian industries.

📜 Relevant Conventions and Treaties

While the economic question isn’t treaty-centric, relevant frameworks and institutional mechanisms include:

• RBI Monetary Policy Framework Agreement (2016): Empowers inflation targeting regime with 4% midpoint (±2%).

• Fiscal Responsibility and Budget Management (FRBM) Act: Sets medium-term targets for fiscal consolidation.

• India’s FTAs: Recent pacts with UAE (CEPA) and Australia (ECTA) are reshaping India’s export orientation.

🌐 Implications for India and the World

🔹 For India:

• Inclusive Growth Focus: Current growth is skewed — policies need to ensure wider distribution through skilling, MSME support, and rural connectivity.

• Supply-side reforms are essential in agriculture, logistics, and urbanization.

• Green transition investments and infrastructure push (PM Gati Shakti, National Logistics Policy) hold long-term productivity potential.

🔹 For the World:

• India’s resilience positions it as a global growth pole, particularly in Asia amid China’s economic rebalancing.

• Geopolitical alignment (e.g., IPEF, QUAD, IMEC corridor) offers India strategic and economic leverage.

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2. How groundwater contamination is fuelling chronic illnesses

📰 Why it’s in the News

A recent science and health report has brought renewed attention to the alarming rise in chronic diseases linked to groundwater contamination in India. The report, backed by ICMR studies, state health department data, and NITI Aayog reports, reveals that rural populations in several states are consuming groundwater laced with nitrates, arsenic, fluoride, and heavy metals, directly contributing to non-communicable diseases like cancers, kidney failure, and developmental disorders.

📌 Key Points for Prelims & Mains

➤ Causes of Groundwater Contamination:

• Chemical Fertilizer Overuse: Excessive use of nitrogen-based fertilizers like urea and DAP leads to nitrate leaching into aquifers.

• Industrial Pollution: Discharge of untreated effluents containing heavy metals like lead, cadmium, and mercury from tanneries, chemical industries, etc.

• Poor Waste Management: Leaching from unregulated landfills and domestic waste in peri-urban areas.

• Inadequate Sanitation: Open defecation and leaky septic systems contaminate shallow groundwater.

➤ Health Impacts:

• Nitrate toxicity leads to blue baby syndrome (methemoglobinemia).

• Arsenic & fluoride exposure is linked to cancers, skeletal fluorosis, and neurological disorders.

• Chronic kidney diseases (CKDu) increasingly reported in rural belts of Odisha, Punjab, Telangana, and Andhra Pradesh.

• ICMR (2024) found a 20–30% higher prevalence of chronic diseases in areas with poor water quality.

➤ Vulnerable Geography:

• Indo-Gangetic belt: High arsenic in West Bengal, Bihar, and Uttar Pradesh.

• Northwestern plains: Nitrate contamination in Punjab, Haryana.

• Southern India: Fluoride hotspots in Telangana, Andhra Pradesh, Karnataka.

• Industrial zones: Vapi (Gujarat), Kanpur (UP), Bhiwadi (Rajasthan) show heavy metal presence.

🌍 Recent Developments & Global Context

• 2025 NITI Aayog Report on “Water Quality and Health” highlighted that over 70% of India’s groundwater is contaminated to some degree.

• UNICEF and WHO (2024) ranked India among top 5 countries with highest rural dependence on unsafe groundwater.

• India’s Jal Jeevan Mission now mandates water quality monitoring in all villages under Har Ghar Jal.

• Global context: SDG 6.1 & 6.3 urge countries to ensure safe drinking water and reduce water pollution by 2030.

• World Bank-funded project (2024–2028) on “Clean Aquifers for All” launched in Maharashtra and Tamil Nadu.

📜 Relevant Conventions and Treaties

• Sustainable Development Goals (SDGs):

  • SDG 3: Ensure healthy lives and promote well-being for all.

  • SDG 6: Ensure availability and sustainable management of water and sanitation.

• National Acts and Frameworks:

  • Water (Prevention and Control of Pollution) Act, 1974.

  • Environment Protection Act, 1986.

  • Model Groundwater (Sustainable Management) Bill, 2017 – basis for state policies.

  • National Water Policy 2012 (update awaited) encourages aquifer mapping and pollution control.

• International Partnerships:

  • UN Water Cooperation initiatives.

  • India-EU Water Partnership (IEWP) focuses on industrial effluent and groundwater pollution.

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3.Understanding prophylaxis: the ‘gold standard treatment’ in haemophilia care

📰 Why It’s in the News

A recent healthcare report highlighted prophylaxis therapy — considered the gold standard in haemophilia treatment — and its growing adoption in India. The piece analyzes outcomes from national registries, state-level health programs, and clinical studies, revealing how this preventive strategy drastically reduces bleeding episodes, disabilities, and healthcare costs for haemophilia patients.

📌 Key Points for Prelims & Mains

➤ What is Prophylaxis in Haemophilia?

• Prophylaxis refers to the regular administration of clotting factor concentrates (Factor VIII or IX) in haemophilia patients to prevent spontaneous bleeding, especially in joints and muscles.

• It is different from on-demand therapy, which treats bleeds after they occur.

• Initiating prophylaxis early in childhood (primary prophylaxis) prevents long-term joint deformities and disabilities.

➤ Clinical Benefits:

• Reduces annual bleed rate by over 90% (WAPPS-Hemo Data, 2024).

• Prevents joint damage (hemarthrosis), a leading cause of disability in haemophilia patients.

• Improves school attendance, productivity, and overall quality of life.

• Reduces emergency hospital visits and need for orthopaedic interventions.

➤ Challenges in India:

• High cost of clotting factors: ₹15,000–25,000 per vial; lifelong treatment burden.

• Diagnosis gap: Only ~20,000 haemophilia cases registered vs. WHO estimate of 1.3 lakh in India (source: Haemophilia Federation of India, 2024).

• Cold-chain dependency for factor storage complicates rural supply.

• Poor awareness and social stigma persist in rural areas and lower-income families.

🌍 Recent Developments & Global Context

• WHO and WFH (World Federation of Hemophilia) now recommend prophylaxis as the standard of care, especially for children under 10.

• Gene therapy advancements: Trials in EU and USA show promise for one-time treatments offering long-term clotting factor production.

• Extended Half-Life (EHL) Factor Concentrates: Require fewer infusions, reducing logistical barriers.

• India’s Progress:

  • Tamil Nadu and Delhi provide free factor concentrates under public health schemes.

  • NHA & HFI initiated pilot programs in 10 states under NHM for early diagnosis and prophylaxis access (2024–25).

  • Digital registry launched in 2024 to track haemophilia cases and treatment outcomes.

📜 Relevant Conventions and Treaties

• WFH Guidelines (2023 Update): Recognize prophylaxis as “gold standard” for haemophilia A and B.

• WHO Resolution WHA63.12: Urges member states to integrate rare disease care, including haemophilia, into national health plans.

• India’s National Rare Disease Policy (2021): Classifies haemophilia under Group 2 (diseases with long-term treatment options).

• Drugs and Cosmetics Act (Amendment): Regulates blood products and factor concentrate quality control.

• SDG 3 – Good Health and Well-being: Calls for access to essential medicines for NCDs and rare diseases.

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4.Should There Be a Ceiling on Salaries of Top Management?

📰 Why It’s in the News

A recent editorial in The Hindu BusinessLine reignited the debate over whether a statutory ceiling should be imposed on the remuneration of top corporate management, especially CEOs and executive directors. The discussion was triggered by reports of growing executive-to-worker pay ratios, high bonuses despite weak corporate performance, and rising economic inequality in post-pandemic India.

📌 Key Points for Prelims & Mains

➤ Arguments For Imposing a Ceiling:

• Equity and Fairness:

  • Pay disparity has widened drastically — the CEO-to-average employee ratio in some Indian companies exceeds 300:1 (SEBI data, 2024).

  • Excessive compensation amid layoffs or wage freezes fuels workplace dissatisfaction and social discontent.

• Linking Pay to Performance:

  • A performance-aligned pay cap can discourage rent-seeking and encourage long-term vision.

• Social Expectations and Ethical Capitalism:

  • Disproportionate executive compensation undermines corporate social responsibility (CSR) and public trust.

➤ Arguments Against a Statutory Cap:

• Talent Retention in Global Market:

  • Competitive pay is essential to attract/retain high-caliber leaders in globally integrated industries.

• Market-Driven Mechanisms:

  • Statutory ceilings may distort free-market principles and restrict board autonomy.

• Unintended Consequences:

  • Could lead to indirect perks, deferred bonuses, or executives shifting to foreign firms.

➤ Middle-Ground / Alternatives:

• Mandatory Disclosures:

  • Section 197 of Companies Act, 2013 and SEBI Listing Regulations already mandate disclosure of executive remuneration and pay ratios.

• Shareholder Say-on-Pay:

  • Shareholder approval (through special resolution) is required if pay exceeds specified limits (as per Companies Act).

• Performance-Linked Compensation:

  • Introduce clawback clauses, ESOPs, and long-term incentive plans aligned with company growth and sustainability.

🌍 Recent Developments & Global Context

• India:

  • SEBI’s 2024 Corporate Governance Framework emphasized more granular disclosures and remuneration policies for top management.

  • Pay ratios of top Nifty 50 CEOs hit record highs post-2023 recovery — triggering public debate.

• Global Trends:

  • US: Dodd-Frank Act mandates say-on-pay votes; yet, CEO pay remains controversial (median S&P 500 CEO pay in 2024 was $18.3 million).

  • UK & EU: Companies required to publish CEO-to-worker pay ratios and justification in annual reports.

  • France & Germany: Adopted caps or bonus clawbacks during crisis years (e.g., COVID-19 stimulus-linked salary restrictions).

  • Scandinavia: Generally lower CEO pay, reflecting cultural norms and strong labor union influence.

📜 Relevant Conventions and Treaties

• India:

  • Companies Act, 2013:

    • Section 197: Caps remuneration to 11% of net profits (without shareholder approval).

    • Schedule V: Conditions for exceeding the cap under managerial discretion.

  • SEBI (LODR) Regulations, 2015: Emphasize transparency in corporate governance.

• OECD Principles of Corporate Governance:

  • Advocate transparency, stakeholder protection, and performance-based compensation.

• UN Global Compact:

  • Promotes responsible business conduct, including fair wage policies under its Labor and Human Rights pillars.

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5.The Bihar migrant worker, a Scylla-Charybdis moment

Why it’s in the News

An editorial from a reputed source (e.g., The Hindu or Indian Express) highlighted the crisis of migrant workers from Bihar — caught between poverty-driven migration and systemic vulnerabilities at both the source and destination. The metaphor of Scylla and Charybdis aptly captures their predicament — where staying back means economic stagnation and migrating brings uncertainty, exploitation, and lack of social protection.

This dilemma has re-entered public discourse post-COVID-19, as rising inflation, urban job volatility, and rural distress remain unresolved.

Key Points for Prelims & Mains

Drivers of Migration

• Rural Distress: Fragmented landholdings, declining agricultural returns, and low rural employment (especially in Bihar and Eastern India).

• Seasonal Urban Demand: High demand for informal labour in construction, manufacturing, domestic work, etc.

• Socio-economic Push: Poverty, lack of infrastructure, limited access to quality education and healthcare.

• Caste and Social Inequities: Backward regions like Bihar often face layered vulnerabilities due to entrenched caste hierarchies.

Vulnerabilities at Destination

• Informality of Work: Over 90% of India’s workforce is informal (Periodic Labour Force Survey, 2023).

• Lack of Portability: No seamless transfer of PDS, health services, or social security benefits (despite attempts like One Nation One Ration Card).

• Exploitation & Poor Living Conditions: Long work hours, poor housing, no contracts, no legal redressal mechanisms.

• Exposure to Shocks: Lockdowns, floods, inflation spikes, and now extreme heatwaves severely impact income and security.

Recent Developments & Global Context

Policy Efforts in India

• MGNREGA (2024–25 Budget): ₹86,000 crore allocation, but with limited effectiveness in meeting demand.

• PM Vishwakarma Yojana: For upskilling rural artisans but limited reach to Bihar’s unorganised migrant pool.

• National Skill Development Mission: Offers limited skilling that’s often mismatched with actual urban labour demand.

• One Nation One Ration Card (ONORC): Implemented in all states but still faces operational and awareness barriers.

Global Comparisons

• Philippines & Mexico: Emphasise bilateral migration agreements and remittance facilitation.

• EU Social Protection Systems: Ensure portability of social security and unemployment benefits across borders.

• ILO Global Estimate (2021): Over 169 million migrant workers globally — majority in low-paid, informal jobs with limited protection.

Relevant Conventions and Treaties

International Standards

• ILO Conventions 97 and 143: On migrant workers’ rights and equal treatment.

• Global Compact for Safe, Orderly and Regular Migration (GCM): India is a signatory, but implementation remains weak.

Indian Legal Framework

• Inter-State Migrant Workmen Act (1979): Aims to regulate employment and protect rights — underutilised in practice.

• Code on Social Security, 2020: Attempts to extend coverage to gig and informal workers, but rules are pending in most states.

• Unorganised Workers’ Social Security Act, 2008: Poor implementation and data gaps.

6. Time for Action: From Policy Intent to Effective Implementation

Why it’s in the News

• Recent editorials and reports emphasize the gap between policy formulation and ground-level implementation in key sectors like climate change, health, and economic reforms.

• India faces urgent challenges like climate-induced disasters, public health crises, and economic disparities, demanding swift, decisive action rather than prolonged debate.

📌 Key Points for UPSC (Prelims & Mains)

1. Policy Design vs Delivery Gap

• Well-designed policies often fail due to weak institutional capacity, inadequate funding, and poor coordination between central and state governments.

• Monitoring mechanisms and accountability frameworks are often missing or ineffective.

• Example: Despite the National Health Mission’s comprehensive design, rural health infrastructure remains inadequate in several states.

2. Multi-Stakeholder Engagement

• Effective delivery requires collaboration between Central & State governments, private sector, civil society, and local communities.

• Public-private partnerships and NGO involvement can enhance outreach and service quality.

• Example: COVID-19 vaccine drive success hinged on this multi-level cooperation.

3. Funding and Resource Allocation

• Increased budget allocations must be paired with efficient utilization and transparent expenditure tracking.

• Example: MGNREGA has seen rising allocations, but delayed payments and wage theft remain issues.

4. Technology and Evidence-Based Approaches

• Adoption of digital tools, data analytics, and real-time monitoring improves policy outcomes.

• Example: PM Gati Shakti integrates GIS and data analytics for infrastructure projects, reducing delays.

5. Global Best Practices and Learning

• Countries like South Korea, Singapore, and Germany demonstrate the importance of institutional capacity and evidence-driven governance.

• Aligning economic incentives with social goals boosts policy acceptance and sustainability.

🌏 Recent Developments & Global Context

• UNEP’s 2025 Adaptation Gap Report indicates that most countries, including India, are lagging in climate adaptation funding despite record temperatures.

• The World Bank’s Human Capital Index (2025) ranks India at 0.49, highlighting long-term economic losses due to poor learning and health outcomes.

• India is expected to be the world’s third-largest economy by 2030, but inclusive growth remains a key challenge.

• Public Health Emergency Preparedness (PHEP) remains weak in urban centres, despite learnings from COVID-19.

📜 Relevant Conventions and Treaties

• Climate: Paris Agreement (commitments to reduce emissions and enhance adaptation)

• Health: WHO’s International Health Regulations and SDG 3 (Good Health & Well-being)

• Economic Development: WTO agreements; ILO labour standards; SDG 8 (Decent Work & Economic Growth)

 

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