1) Indian Railways: Stagnant Investments and Unresolved Challenges

GS 3: Economy: Railway Budget

Why is it in the news?

• The Indian Railways (IR) once enjoyed an exclusive Railway Budget before its merger with the general Budget in 2017. Since then, IR has been relegated to a minor mention, and in the latest Budget, it did not even find a passing reference.
• Given the disappointing financial numbers, rail watchers and industry experts focused on capital expenditure (capex) as the key takeaway. However, even the anticipated capex push did not go beyond the last two years’ ₹2.62 lakh crore, signalling a pause in the government’s investment strategy.

An Analysis

Capital Expenditure and Financial Struggles

• With IR’s earnings barely covering operational costs, the government’s increased budgetary support has been keeping it afloat. Over the past decade, ₹13 lakh crore has been spent on infrastructure modernisation—95% of electrification is complete, track length has expanded, and rolling stock has increased.
• Despite this, returns remain underwhelming. Freight traffic growth is sluggish at just over 2%, even as the economy expands, and while passenger revenue is rising, pre-COVID patronage levels have not been restored.
• The Budget resorted to accounting adjustments to maintain the Operating Ratio (OR) below 100, without reviewing past commitments.

Post-Budget Announcements

• In a post-Budget press conference, the Railways Minister reiterated the focus on infrastructure development, modernisation of stations, and improved connectivity, safety, and passenger comfort.
• He stated that an average of 150 km of new tracks have been laid annually since 2014, compared to 113 km per year between 2009-2014, a move that could ease congestion and improve mobility. However, no details were provided regarding past promises or unfinished projects.

Safety and Infrastructure Concerns

• The budget allocation for safety initiatives stands at ₹1,16,514 crore, with grade separation work progressing well. However, the Kavach system, introduced to prevent collisions, has seen no expansion beyond the initial 1,465 km rollout near Secunderabad.
• Meanwhile, station redevelopment continues under the Amrit Bharat project, but visible improvements are limited to select stations such as Gandhinagar, Habibganj, and Ayodhya.
• The New Delhi station’s transformation into a world-class hub remains stuck in bureaucratic hurdles, reflecting IR’s inefficiency in execution.
• With station redevelopment now shifting to the Engineering, Procurement, and Construction (EPC) model due to the failure of Public-Private Partnerships (PPP), concerns arise about maintaining these facilities given IR’s financial struggles.

Electrification and Sustainability Challenges

• The Minister highlighted IR’s rapid electrification, averaging 294 Rkms per year since 2014, making it the world’s first fully electrified and “greenest” railway. However, this electrification spree raises concerns about the underutilisation of nearly 5,000 diesel locomotives worth ₹30,000 crore.
• Additionally, much of the electricity powering IR still comes from fossil fuels, casting doubt on its green credentials.

High-Speed Rail and Pending Projects

• A key Budget announcement was the introduction of 200 more Vande Bharat trains, though no timeline was provided. Crucial projects like the Western Dedicated Freight Corridor, the Mumbai-Ahmedabad High-Speed Rail, and the conversion of Integral Coach Factory (ICF) coaches to Vande Bharat standards remain unaddressed.
• Instead, a grand vision of a 7,000-km high-speed rail network with speeds of 250 kmph by 2047 was presented, lacking a concrete strategy for execution.

Freight and Operational Challenges

• The Railways was proclaimed to be on track to becoming the world’s second-largest freight carrier, handling 1.6 billion tonnes of cargo.
• However, in the absence of a clear freight strategy, the key concerns remain—how will IR reclaim its declining freight share? Can train speeds and passenger comfort improve beyond mere second-class coach additions?

Conclusion

• For yet another year, the Budget has failed to outline a transformative plan for the Railways.
• Instead, IR continues to function in a reactive mode, waiting for the next high-profile announcement rather than addressing fundamental issues of efficiency, freight competitiveness, and financial sustainability.

2) Urban Development in Budget: Capital-Intensive Focus and Rising Inequities

GS 3: Economy: Developing Urban Infrastructure

Why is it in the news?

• Since 2015, urban development has been a key pillar of the NDA government’s growth strategy, recognizing that cities contribute nearly 67% to the GDP. However, in the government’s vision for a “Viksit Bharat,” cities appear to be largely overlooked.

An Analysis

Urban Development Allocation

• The total allocation for urban development stands at ₹96,777 crore, an increase from last year’s ₹82,576.57 crore. However, after accounting for inflation, the real allocation has declined.
• The Revised Estimate (RE) suggests that only ₹63,669.93 crore will be spent by March, indicating an underutilization rate of 22.9%.
• A major shortfall is in the Pradhan Mantri Awas Yojana (Urban) [PMAY(U)], which had an initial allocation of ₹30,170.61 crore for FY 2024-25, but the RE slashed it to just ₹13,670 crore. This highlights the gap between ambitious policies and actual implementation.
• Despite an increase in urban outlay, the focus remains on capital-intensive projects rather than employment generation and sustainable urban development.

Decline in Funding for Urban Local Bodies

• Urban development funding flows through three primary channels: direct transfers to Urban Local Bodies (ULBs), Centrally Sponsored Schemes (CSS), and Central Sector Schemes.
• Direct transfers to ULBs have declined. Since the abolition of octroi (a major municipal revenue source), the expectation was that GST revenues would compensate for the loss.
• However, the revenue share for ULBs has dropped from ₹26,653 crore last year to ₹26,158 crore this year, forcing cities to raise their own revenues through higher local taxes.

Cuts in Centrally Sponsored Schemes (CSS)

• CSS requires cost-sharing between the Union, State, and local governments. Major urban schemes under this category include PMAY, the Swachh Bharat Mission (SBM), Atal Mission for Rejuvenation and Urban Transformation (AMRUT), and the Smart Cities Mission.
• Budget allocations for these schemes have decreased significantly. The PMAY (CSS component) saw a 30% reduction in allocation compared to last year. While SBM (Urban) retains its previous year’s allocation of ₹5,000 crore, the RE shows only ₹2,159 crore will be spent—56% less than allocated.

Rise in Central Sector Scheme Allocation

• Unlike other urban development initiatives, metro rail projects have seen a significant increase in funding. These schemes, directly controlled by the Union government, often have strong political overtones and focus on large infrastructure projects.
• In FY 2024-25, the allocation for Mass Rapid Transit Systems and metro projects was ₹21,335.98 crore, later revised to ₹24,691.47 crore. The 2025-26 Budget further increases this to ₹31,239.28 crore, marking a 46% jump over the previous year.
• However, prioritizing metro expansion over comprehensive urban mobility raises concerns about equitable urban development.

Future Prospects and Challenges

• The Budget introduces a new Urban Challenge Fund of ₹10,000 crore to promote urban redevelopment, with an ambitious target of ₹1 lakh crore in investment.
• However, half of this amount is expected from private investors, an optimistic assumption given the private sector’s minimal role in the Smart Cities Mission.

Conclusion

• The Budget’s urban development strategy focuses heavily on capital-intensive projects, with less emphasis on employment generation, green jobs, and sustainable economic policies.
• While large infrastructure investments are necessary, the neglect of social and economic equity could exacerbate existing urban inequalities.

3) Punjab’s Potash Reserves: A Step Towards Self-Reliance or a Challenge?

GS 3: Economy: Mineral Reserves

Why is it in the news?

• On February 6, Punjab Mining Minister announced plans to explore potash mining in Fazilka and Sri Muktsar Sahib districts. Surveys by the Geological Survey of India (GSI) have identified significant mineral reserves in three mining blocks.
• Similar reserves have also been found in Rajasthan, highlighting the potential for domestic potash mining to reduce India’s dependence on imports and strengthen the fertilizer industry. However, concerns have been raised regarding the environmental and social impact of mining.

What is Potash?

• Potash refers to potassium-bearing minerals primarily used in fertilizers. It is one of the three essential nutrients for plant growth—Nitrogen, Phosphorus, and Potassium (N-P-K). According to the Indian Minerals Yearbook (2021), potash enhances plant health, boosts crop yields, and is widely used in agriculture.
• There are different forms of potash fertilizers, including Sulphate of Potash (SOP) and Muriate of Potash (MOP). SOP, which is chloride-free, is used for high-value crops such as fruits, vegetables, and leafy plants. MOP, which contains some chloride, is commonly used for carbohydrate-rich crops like wheat.
• India currently imports around 50 lakh tonnes of potash annually, making domestic production crucial for self-reliance.

Potash Reserves in Punjab and Rajasthan

• Punjab is the second state after Rajasthan to have significant potash reserves. The three identified mining blocks in Punjab include Kabarwala (Muktsar Sahib), Sherewala and Ramsara (Fazilka), and Shergarh and Dalmir Khera (Fazilka), covering nearly 18 square kilometers.
• In Rajasthan, potash reserves are mainly found in the Nagaur-Ganganagar basin, particularly in Ganganagar and Hanumangarh districts bordering Fazilka and Muktsar. Extensive explorations by GSI between 1974 and 1991 revealed deposits in Nagaur, Churu, and Bikaner. Further surveys in 2017 confirmed deposits in Punjab.
• Despite having substantial reserves, India has not yet engaged in potash mining. The National Mineral Inventory (NMI) estimates the country’s total potash resources at 23,091 million tonnes as of 2020, with Rajasthan alone contributing 89% of this total.

Challenges in Potash Mining in Punjab

• Although potash reserves were confirmed in Punjab in 2019, mining has yet to begin. The GSI discovered deposits located about 450 meters below the surface in the Satluj basin, part of the Indo-Gangetic alluvial plain.
• However, concerns from local farmers have delayed progress. Some farmers in Muktsar and Fazilka fear their land will be acquired for mining and have protested against any future extraction.
• In response, the Punjab government has assured that potash will be extracted using advanced drilling technology with no impact on land ownership. Additionally, an environmental and social impact assessment is being conducted before operations commence.
• Though the Minister has emphasized the potential benefits, including job creation and regional economic development, farmers have demanded a written assurance that their land will not be taken.

Next Steps for Potash Mining

• The central government holds the auctioning rights for minerals, while states receive royalties from their extraction. The Kabarwala block has reached the auctioning stage, with the Punjab government approving mining operations.
• Once the central government completes the auctioning process, extraction can begin. However, without resolving the farmers’ concerns, the project is unlikely to move forward.

4) Union Cabinet Approves South Coast Railway Zone

GS 3: Economy: Railway Infrastructure

Why is it in the news?

• On February 7, the Union Cabinet approved the creation of the South Coast Railway (SCoR) Zone. PM Narendra Modi had earlier laid the foundation stone for the SCoR headquarters in Visakhapatnam, Andhra Pradesh.
• The new zone was formed under the Andhra Pradesh Reorganisation Act of 2014, which led to the bifurcation of Andhra Pradesh and the creation of Telangana. It will be the 18th zone of Indian Railways and has been carved out from parts of the East Coast Railway (ECoR) and South Central Railway (SCR) zones.

Division of Waltair Railway Zone

• The Waltair Railway Division, one of the most revenue-generating divisions under Indian Railways, has been split into two parts.
• The first part has been renamed Visakhapatnam Railway Division and placed under the new SCoR zone. The second part will become a new division with its headquarters at Rayagada, Odisha, under the East Coast Railway.

Reason for the New Railway Zone

• The Andhra Pradesh Reorganisation Act mandated Indian Railways to examine the establishment of a new railway zone.
• On February 27, 2019, the Central government announced the creation of the South Coast Railway Zone to enhance operational efficiency and cater to the growing passenger and freight demands. The plan is now being implemented with modifications to the earlier decision.
• The New zone would support industrial and agricultural growth, improve logistics for key ports like Visakhapatnam and Krishnapatnam, and boost tourism to cultural destinations such as Tirupati.

Divisions Under the South Coast Railway Zone

• The new zone will cover large parts of Andhra Pradesh, along with regions in Telangana and Tamil Nadu. It will include:

1. Vijayawada Division (from South Central Railway)
2. Guntur Division (from South Central Railway)
3. Visakhapatnam Division (carved from Waltair Division)

• The Visakhapatnam Division will oversee sections such as Palasa-Visakhapatnam-Duvvada, Kuneru–Vizianagaram, Naupada Jn.–Paralakhemundi, Bobbili Jn.–Salur, Simhachalam North–Duvvada bypass, Vadalapudi–Duvvada, and Visakhapatnam Steel Plant–Jaggayapalem (approximately 410 km).
• The remaining part of the Waltair Division, covering sections like Kottavalasa–Bacheli, Kuneru–Theruvali Jn., Singapur Rd.–Koraput Jn., and Paralakhemundi–Gunpur (approximately 680 km), will be converted into a new division headquartered at Rayagada under ECoR.

Economic Importance of Waltair Division

• Waltair Division plays a crucial role in railway revenues due to its freight traffic, which is linked to the mining and steel industries in Odisha and Chhattisgarh. According to the Ministry of Railways, the East Coast Railway (ECoR) achieved record freight loading in the Financial Year 2023-24, reaching 250 million tonnes.
• The Khurda Road Division contributed 156.17 million tonnes, followed by 74.66 million tonnes by Waltair Division and 19.20 million tonnes by Sambalpur Division.
• ECoR became the first railway zone to surpass 200 million tonnes of freight loading for the fifth consecutive year.

Opposition to the Decision

• The move to bifurcate Waltair Division has faced criticism from Odisha’s Opposition parties. They argue that shifting the revenue-generating portion of ECoR, headquartered in Bhubaneswar, to the South Coast Railway Zone could negatively impact Odisha’s economy.
• Despite the criticism, the government has proceeded with the plan, citing benefits to Andhra Pradesh’s industrial growth, logistics, and tourism.

5) Rising Temperatures and Climate Change in Australia

GS 1: Geography: Australia witnessing warm year

Why is it in the news?

• According to Australia’s Bureau of Meteorology (BoM), 2024 was the country’s second warmest year since 1901. This aligns with the World Meteorological Organization’s (WMO) declaration that 2023 was the warmest year on record.
• Australia has been witnessing a continuous rise in temperatures, with significant environmental and climatic impacts.

Increasing Heat Trends

• Since 1901, Australia’s average temperature has risen by 1.51°C. The year 2019 remains its warmest on record, with eight of the hottest years occurring between 2013 and 2024.
• The frequency of hot days has increased, while cold days and nights have declined. Additionally, Australia’s landmass is warming 40% faster than the surrounding ocean, intensifying climatic changes.

Shifting Rainfall Patterns

• Australia’s rainfall patterns are influenced by the Indian Ocean Dipole (IOD) and the El Niño-Southern Oscillation (ENSO), which determine seasonal variations. The April-October rainfall period is crucial for agriculture and groundwater recharge.
• However, long-term trends indicate a decline in rainfall in the country’s southwest and southeast regions. Since 1970, the southwest has seen a 20% drop in rainfall compared to the 1900-1969 average, with a further 24% decline in May-July rainfall since 1994. These changes are attributed to shifting weather patterns, rising temperatures, and fewer low-pressure systems.
• In contrast, northern Australia has experienced increased rainfall since 1994, but this comes with short and intense downpours, leading to frequent floods.
• Climate change has contributed to a 10% increase in extreme rainfall events over recent decades, particularly those triggered by thunderstorms rather than low-pressure systems.

Warming Oceans

• Australia’s surrounding oceans have been warming rapidly. Since 1900, sea surface temperatures (SST) in the region have increased by 1.08°C, with 2022 recording the highest spike, largely due to a negative IOD phase. As a result, marine heatwaves (MHWs) have intensified, lasting longer and occurring more frequently.
• In January 2024, MHWs led to the death of over 30,000 fish, highlighting the devastating impact of rising ocean temperatures. Australia’s waters are warming faster than those in many other regions, threatening marine ecosystems.

Future Climate Predictions

• BoM forecasts continued warming in the coming decades, with an increase in extreme heat events.
• Droughts will intensify due to declining April-October rainfall, while short but intense rainfall spells will become more frequent, increasing the risk of flooding. Rising sea levels and ocean acidification will accelerate, further endangering marine biodiversity.
• Additionally, the frequency of tropical cyclones is expected to decline, but those that do form will be more intense, bringing heavy rainfall and strong winds. Snow cover in alpine regions will continue to shrink, affecting local ecosystems.
• Climate change will reshape Australia’s environment, necessitating urgent adaptation and mitigation strategies.

6) Financial Support for Rare Diseases

GS 3: Science and Technology: Improving access to rare diseases

Why is it in the news?

• The government has introduced financial aid of up to ₹50 lakhs to assist patients suffering from rare diseases under the National Policy for Rare Diseases (NPRD).
• This initiative currently covers 63 categories of rare diseases, aiming to provide essential treatment and support.

Understanding Rare Diseases

• Rare diseases are medical conditions that affect a small fraction of the population. While there is no globally standardized definition, they are generally severe, with limited or no available treatments.
• These diseases include genetic disorders, uncommon cancers, tropical infections, and degenerative conditions. As per WHO, a rare disease is a chronic, debilitating condition with a prevalence of 1 or fewer per 1,000 individuals.

Challenges and Concerns

• India accounts for nearly one-third of the world’s rare disease cases, with over 450 identified conditions impacting 8–10 crore people, mostly children. Despite this, rare diseases remain largely overlooked. A significant challenge is the absence of a clear definition in India.
• Additionally, diagnosing these conditions is time-consuming, often taking up to seven years due to a lack of awareness among healthcare professionals. Financial constraints further exacerbate the issue, as the budget allocated for rare disease treatment remains inadequate.

Government Efforts

• The NPRD, introduced in March 2021 by the Ministry of Health & Family Welfare, includes 63 rare diseases based on recommendations from the Central Technical Committee for Rare Diseases (CTCRD).
• The government has designated 12 Centres of Excellence (CoEs) in major hospitals for diagnosis, prevention, and treatment. To ease the financial burden, drugs imported for rare diseases are exempt from GST and customs duty.
• Research efforts have been strengthened through the establishment of the National Consortium for Research and Development on Therapeutics for Rare Diseases (NCRDTRD), while the ICMR has launched 19 projects under its Extramural Programme Task Force to develop indigenous treatments.

Way Forward

• Given the urgency of rare diseases, immediate policy reforms are essential. The government should define rare diseases, encourage drug development, improve coordination among Centres of Excellence (CoEs), and increase financial allocations.
• State governments must introduce social welfare programs and establish satellite centres, while private sector contributions through CSR initiatives can help bridge gaps.
• Incentivizing domestic pharmaceutical companies, repurposing existing drugs, and simplifying clinical trial regulations can further improve access to treatment.

7) e-NAM 2.0: Upgrading to Overcome Logistical Challenges

GS 3: Economy: Upgrading e-NAM 

Why is it in the news?

• The Union Agriculture Minister has announced the launch of e-NAM 2.0 to enhance the efficiency of inter-state and inter-mandi trade by addressing logistical and infrastructural hurdles in the existing National Agricultural Market (e-NAM).

Understanding e-NAM

• Launched in 2016, e-NAM is a nationwide digital trading platform that connects Agricultural Produce Market Committee (APMC) mandis to create a unified market for agricultural commodities.
• It is implemented by the Small Farmers Agribusiness Consortium (SFAC) under the Ministry of Agriculture & Farmers’ Welfare (MoA&FW). The platform provides digital services to farmers, traders, Farmer Producer Organizations (FPOs), and mandis.
• As of December 31, 2024, e-NAM has registered 1.79 crore farmers and 2.63 lakh traders.

Challenges in the Current e-NAM System

• Despite integrating 1,361 mandis across 23 states and 4 Union Territories, facilitating transactions worth ₹2.79 lakh crore, several obstacles persist. Inefficient transportation leads to high transit times and restricts distribution efficiency.
• The lack of adequate warehousing and storage results in significant post-harvest losses. Many farmers struggle with digital literacy and limited internet access, making online transactions difficult.
• Additionally, interstate trade faces hurdles due to varying APMC laws, inconsistent tax structures, and complex compliance requirements across states.

Key Features of e-NAM 2.0

• The upgraded version of e-NAM aims to resolve these issues by introducing multiple improvements. Integrated logistics support through the Unified Logistics Interface Platform (ULIP) will enable real-time tracking of produce, while optimized freight options will help minimize transit delays.
• The Agricultural Infrastructure Fund (AIF) will facilitate private investments in warehouses and cold storage by offering subsidized loans. AI-driven price discovery and automated quality testing will enhance fair pricing and reduce disputes over grading.
• Faster digital payments will be enabled through direct bank transfers and e-wallet integration, with fintech collaborations offering micro-loans based on transaction history.
• A unified digital pass will simplify interstate trade by standardizing tax and compliance norms, allowing seamless produce movement. Moreover, mobile accessibility will be improved through voice-command features and local language support, with digital literacy campaigns to help farmers navigate the platform.

Expected Impact of e-NAM Upgrades

• The enhancements in e-NAM 2.0 are expected to increase farmer participation by improving accessibility and providing better incentives. Farmers will benefit from higher price realization due to direct market access, reducing reliance on middlemen.
• Improved storage and transport infrastructure will significantly cut post-harvest losses. Additionally, increased investment in supply chain solutions will drive economic growth in the agricultural logistics sector, ultimately strengthening the agricultural market ecosystem.