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October 13th Current Affairs

Home / UPSC / Current affairs / UPSC Current Affairs – October 13th

Table of Contents

Retail inflation rises to 5.54% in September 2026

Why is this news important?

India’s retail inflation increased to 5.54% in September 2026, compared with 4.83% in August. The main reason was a sharp rise in food prices, particularly onions and other essential commodities.

Food inflation increased to 7.74% in September from 5.97% in August. Rural inflation reached 6.08%, while urban inflation stood at 4.88%. These figures are based on provisional data released by the Ministry of Statistics and Programme Implementation (MoSPI).

Retail inflation (September)

5.54%

August: 4.83%

Food inflation (September)

7.74%

August: 5.97%

Rural inflation

6.08%

Urban inflation

4.88%

What is retail inflation?

Retail inflation refers to the increase in the prices of goods and services purchased by households over a period of time. In India, it is measured using the Consumer Price Index (CPI).

For example, if a household spent ₹1,000 on a basket of goods last year and the same basket costs ₹1,055.40 this year, the price increase is approximately 5.54%.

  • CPI: Measures changes in consumer-level prices.
  • WPI (Wholesale Price Index): Measures changes in prices at the wholesale level.
  • Food inflation: Measures changes in the prices of food items, using the Consumer Food Price Index (CFPI).

Why is retail inflation increasing?

  • Rising food prices: Higher prices of onions, ginger, garlic and other essential commodities have increased household expenditure.
  • Weather-related factors: Uneven rainfall, crop damage and disruptions in agricultural supply can reduce the availability of food.
  • Supply-chain disruptions: Transportation, storage and distribution costs can increase the prices paid by consumers.
  • Base effect: Changes in prices during the corresponding period of the previous year can influence the year-on-year inflation rate.
  • Higher service costs: Rising prices in areas such as restaurants, accommodation and personal care can add to inflationary pressure.

 

Impact of rising retail inflation

Area

Impact

Households

Reduces purchasing power, particularly for low-income families.

Rural economy

Higher food prices can hurt consumers, although some farmers may benefit from higher selling prices.

Savings

Inflation reduces the real value of money when returns fail to keep pace with rising prices.

Businesses

Higher input costs can reduce profit margins or lead to higher selling prices.

Economic growth

Persistently high inflation can create uncertainty and weaken consumption.

Government

May increase pressure for food-price stabilisation, subsidies and welfare support.

Role of the RBI in controlling inflation

The Reserve Bank of India (RBI) uses monetary policy to maintain price stability while supporting economic growth.

Inflation target

India’s notified CPI inflation target is 4%, with a tolerance band of 2% to 6%. The September 2026 reading of 5.54% is above the central target but remains within this band.

Monetary Policy Committee (MPC)

The MPC determines the policy repo rate. Raising interest rates can moderate borrowing and demand, helping control demand-driven inflation. However, interest rates cannot directly increase the supply of vegetables or other scarce goods.

Challenges in controlling inflation

  • Food-supply constraints: Monetary policy alone cannot address crop failures or shortages.
  • Growth-inflation trade-off: Higher interest rates may control demand but can also make borrowing more expensive for households and businesses.
  • Unequal impact: Low-income households spend a larger share of their income on essential goods.
  • External shocks: International commodity prices and exchange-rate movements can raise domestic costs.

Way forward

  • Strengthen agricultural storage, cold chains and transport infrastructure.
  • Improve market information and monitoring of essential commodity prices.
  • Use timely imports or calibrated market interventions when necessary to address shortages.
  • Improve irrigation, crop diversification and climate-resilient agriculture.
  • Maintain a balanced monetary policy that controls inflation without unnecessarily weakening economic growth.
  • Provide targeted support to vulnerable households rather than relying only on broad subsidies.

Nobel Prize in Economics awarded for research on stabilising the economy

The 2026 Nobel Prize in Economic Sciences was awarded to Robert E. Hall of Stanford University and Michael Woodford of Columbia University for their work on the microeconomic foundations of macroeconomic stabilisation. The award was announced on 12 October 2026 by the Royal Swedish Academy of Sciences. The research helps explain how decisions made by individual households and businesses influence the overall economy, and how governments and central banks can respond to inflation, recessions and economic fluctuations.

What is the Nobel Prize in Economics?

The award’s official name is the Sveriges Riksbank Prize in Economic Sciences in Memory of Alfred Nobel.

  • It was established in 1968 by Sweden’s central bank, Sveriges Riksbank.
  • It was awarded for the first time in 1969.
  • Unlike the original Nobel Prizes established under Alfred Nobel’s will, the Economics prize was created through a separate donation.
  • The Royal Swedish Academy of Sciences selects the laureates.
  • The 2026 prize of 12 million Swedish kronor is shared equally by the two winners.

What is the main contribution of the laureates?

Robert E. Hall

Stanford University, USA

Hall studied how households make consumption decisions based on their expectations of future income and wealth.

Key concept: Consumption and expectations

People may change their spending when they receive unexpected information about their future financial position. His work also examined unemployment and labour-market frictions.

Michael Woodford

Columbia University, USA

Woodford developed modern macroeconomic theory by explaining how expectations, price-setting behaviour and monetary policy interact.

Key concept: Monetary policy and expectations

Central banks can influence present economic decisions through interest-rate policy and clear communication about future policy.

Understanding the award-winning research

The award recognises the microeconomic foundations of macroeconomic stabilisation. Let us understand this concept in simple terms.

Microeconomics studies individual consumers, households and businesses. Macroeconomics studies the economy as a whole, including inflation, GDP, unemployment and economic growth.

The laureates helped connect these two levels of analysis.

For example, when a central bank changes interest rates:

  • Households may change their borrowing, saving and spending.
  • Businesses may reconsider investment and pricing decisions.
  • These individual responses influence overall demand, inflation and employment.

Economic models that account for these behavioural responses help policymakers understand the likely effects of their decisions.

What is macroeconomic stabilisation?

Macroeconomic stabilisation refers to policies designed to reduce excessive fluctuations in economic growth, employment and prices.

Policy

Authority

Examples

Monetary policy

Central bank (RBI in India)

Changing the repo rate and managing liquidity

Fiscal policy

Government

Changing public expenditure and taxation

During a recession, policymakers may support demand through suitable monetary or fiscal measures. When inflationary pressures are high, they may take steps to moderate excessive demand. The appropriate response depends on the cause of the economic problem.

The laureates’ research improves the theoretical understanding of how such interventions work when people and businesses anticipate future policy changes.

Warming Himalayas Demand a Rethink on Development

Why in News?

  • The Himalayan region is experiencing rising temperatures and changes in snow and glacier cover.
  • Climate-related hazards, including flash floods, landslides and glacial lake outburst floods, threaten communities and infrastructure.
  • Recent catastrophic flooding in Nepal has renewed concerns about the safety of roads, hydropower projects and settlements in vulnerable mountain valleys.
  • The editorial calls for a rethink of development practices that do not adequately account for ecological limits and climate risks.

Why are the Himalayas warming rapidly?

According to the current-affairs summary, high mountains in Asia are warming at approximately 0.3°C per decade, nearly twice the global average. The rate of warming varies across the Himalayan region.

Major reasons include:

  • Global warming: Greenhouse gas emissions increase average temperatures and accelerate the loss of snow and ice.
  • Elevation-dependent warming: Some high-altitude areas warm faster than lower elevations.
  • Declining snow cover: Snow reflects sunlight. When it melts, darker land and rock absorb more solar energy, accelerating warming.
  • Changes in precipitation: Rainfall replacing snowfall in some areas can reduce snow accumulation and alter glacier behaviour.

Major environmental changes and their consequences

  1. Glacier retreat

Glaciers shrink when ice loss through melting exceeds the accumulation of snow.

  • Initially, increased melting can raise river flows and flood risks.
  • Over time, declining glacier reserves can reduce dry-season water availability.
  • This threatens irrigation, drinking water and hydropower.

 

  1. Glacial Lake Outburst Floods (GLOFs)

As glaciers retreat, meltwater can accumulate in lakes held back by unstable ice or rock debris.

If the natural barrier fails, a sudden flood can rush downstream, damaging villages, bridges, roads and hydropower facilities.

 

  1. Permafrost thaw

Permafrost is ground that remains at or below 0°C for at least two consecutive years.

When ice within frozen soil and rock melts, mountain slopes can become unstable, increasing the risk of rockfalls, landslides and debris flows.

  1. Infrastructure vulnerability

Roads, tunnels, dams, hydropower projects and settlements may be exposed to multiple hazards in narrow mountain valleys.

Poorly planned construction, slope cutting and inadequate drainage can worsen existing vulnerabilities.

These hazards may combine into cascading disasters: one event triggers several others, such as a slope collapse blocking a river, followed by sudden flooding downstream.

Why are the Himalayas important to India?

  • Water security: The Himalayan region feeds the Indus, Ganga and Brahmaputra river systems.
  • Agriculture: Himalayan-fed rivers support agriculture across the Indo-Gangetic plains.
  • Hydropower: Mountain rivers provide substantial hydropower potential.
  • Biodiversity: The region contains diverse ecosystems, forests and endemic species.
  • Livelihoods: Millions depend on farming, tourism, forestry and other mountain-based activities.
  • National security: The Himalayas are strategically important because India shares mountain borders with several neighbouring countries.

Climate-related disruption in this region can therefore affect water, food, energy and economic security far beyond the mountains.

The central issue: Development versus ecological sustainability

The editorial argues that development cannot be assessed only in terms of roads built, electricity generated or construction completed. It must also account for disaster risks and long-term environmental costs.

Unsustainable approach

Sustainable alternative

Construction without adequate hazard assessment

Scientific, site-specific risk assessment

Unplanned slope cutting

Geologically suitable road alignment and slope stabilisation

Hydropower projects without cumulative impact assessment

Basin-wide environmental and disaster-risk assessment

Construction on flood-prone riverbanks

Hazard-based land-use planning

Limited disaster monitoring

Real-time early-warning and monitoring systems

The goal is not to stop all development, but to ensure that projects are appropriate to the region’s ecological and geological limits.

Way forward

  1. Climate-resilient infrastructure: Apply strict geological, hydrological and seismic assessments before approving major projects.
  2. Early-warning systems: Monitor glaciers, unstable slopes and glacial lakes using satellites, drones, sensors and ground observations.
  3. Scientific land-use planning: Identify floodplains, landslide-prone slopes and other high-risk zones before construction.
  4. Cumulative impact assessments: Evaluate the combined impact of multiple dams, roads and tunnels within a river basin rather than examining each project in isolation.
  5. Community preparedness: Develop evacuation plans, public warning systems and disaster-response training for mountain communities.
  6. Regional cooperation: Share climate data and early warnings among India, Nepal, Bhutan and other Himalayan countries.
  7. Climate mitigation and adaptation: Reduce greenhouse gas emissions while strengthening local ecosystems and disaster resilience.

Drought in Karnataka and Andhra Pradesh highlights the need for stronger drought management

Why in News?

The drought report identifies serious rainfall deficits and crop losses in both States.

Key figures from the report

Karnataka rainfall deficit

~35%

June–September

Andhra Pradesh deficit

53%

June–August

Karnataka drought-hit taluks

217 of 240

Andhra Pradesh drought-hit mandals

388 of 688

  • Karnataka has sought approximately ₹11,000 crore in assistance from the National Disaster Response Fund (NDRF).
  • Andhra Pradesh has allocated ₹190 crore for protecting horticultural crops.
  • Crops affected include red gram, maize, cotton and sugarcane in Karnataka, alongside horticultural crops in Andhra Pradesh.

The editorial “Household debt, financing today against tomorrow” examines the changing pattern of borrowing by Indian households. RBI data show that household debt increased from 39.2% of GDP in March 2021 to 45.5% of GDP in September 2025.

The important issue is not merely the amount of household debt, but what households are borrowing for and how quickly this borrowing is increasing.

What is drought?

Drought is a prolonged period of inadequate water availability caused by deficient precipitation, excessive water demand or a combination of climatic and human factors.

It is not declared solely on the basis of low rainfall. India uses agricultural, meteorological and hydrological information, along with field verification, to assess drought conditions.

Types of drought

Meteorological drought

Rainfall is significantly below the normal level for a specified period.

Agricultural drought

Soil moisture is insufficient to meet crop water requirements, affecting growth and yields.

Hydrological drought

Water levels in rivers, reservoirs and groundwater sources decline significantly.

Socio-economic drought

Water shortages disrupt livelihoods and the availability of essential goods and services.

How does India declare a drought?

The Union Ministry of Agriculture and Farmers Welfare is the nodal ministry for drought management. The Manual for Drought Management, first issued in 2009 and subsequently revised, provides guidance for assessment and declaration.

The assessment considers factors such as:

  • Rainfall deficiency.
  • Extent of area sown and crop conditions.
  • Vegetation health, including the Normalized Difference Vegetation Index (NDVI).
  • Soil moisture and moisture adequacy.
  • Field-level verification and local conditions.

What is NDVI?

The Normalized Difference Vegetation Index uses satellite observations of reflected red and near-infrared light to assess vegetation health. Lower NDVI values can indicate stressed vegetation, although interpretation depends on crop type, season and local conditions.

This technology helps authorities assess drought over large areas more objectively.

NDRF and SDRF: How does drought relief work?

This is an important UPSC Prelims and Mains topic.

Feature

SDRF

NDRF

Full form

State Disaster Response Fund

National Disaster Response Fund

Purpose

Primary fund for State-level disaster response

Additional assistance for qualifying severe disasters

Role

States provide relief using their allocated funds

Centre considers additional assistance under prescribed procedures

Drought relevance

First source of response funding

Additional support may be considered when conditions and eligibility requirements are met

Important distinction: NDRF stands for National Disaster Response Fund in this context. It is different from the National Disaster Response Force.

Process for additional central assistance

  1. State assesses drought damage

Prepares a memorandum detailing damage and assistance required

  1. Inter-Ministerial Central Team (IMCT)

Conducts an assessment and submits its findings

  1. High Level Committee (HLC)

Considers and approves eligible central assistance

The IMCT assesses damage; it does not itself approve the final assistance. Delays between assessment and approval can worsen farmers’ financial distress.

Major consequences of drought

  1. Agricultural distress: Crop failure reduces farmers’ income and increases indebtedness.
  2. Food inflation: Lower agricultural production can increase prices of pulses, cereals and other food items.
  3. Drinking-water shortages: Rural households may face difficulties accessing safe water.
  4. Employment loss: Agricultural labourers and workers in allied sectors may lose income.
  5. Groundwater depletion: Farmers may depend excessively on borewells when rainfall and surface-water supplies are inadequate.
  6. Migration: People may move temporarily or permanently in search of employment and water.
  7. Fiscal pressure: Governments face increased expenditure on relief, water supply and agricultural support.

El Niño and drought in India

El Niño is the abnormal warming of surface waters in the central and eastern equatorial Pacific Ocean. It can alter global atmospheric circulation and is often associated with a weaker Indian summer monsoon, although this relationship is not universal.

In a drought-prone year:

  • Reduced monsoon rainfall may lower soil moisture and reservoir inflows.
  • Rain-fed crops become more vulnerable.
  • Farmers may increase groundwater extraction.
  • Lower agricultural output can contribute to food-price pressures.

The 2026 report flags El Niño as a concern, but its specific contribution to the current drought should not be assumed without a formal attribution assessment.

Way forward: From drought relief to drought resilience

Short-term measures

  • Release eligible disaster assistance promptly after assessment.
  • Provide drinking water, employment support and targeted agricultural relief.
  • Improve access to crop insurance and support for tenant farmers and agricultural labourers.

Long-term measures

  • Promote drip and sprinkler irrigation to improve water-use efficiency.
  • Encourage millets, pulses and other crops suited to local rainfall and soil conditions.
  • Restore tanks, lakes, watersheds and traditional water-harvesting structures.
  • Regulate groundwater extraction and encourage aquifer recharge.
  • Use satellite monitoring, weather forecasts and drought early-warning systems.
  • Develop region-specific drought management plans and allocate funds according to risk.
  • Strengthen coordination between the Centre and States.

River interlinking alone cannot be treated as a universal solution to drought. Local watershed management, sustainable groundwater use, crop diversification and efficient water consumption are essential.

ULLAS – Nav Bharat Saaksharta Karyakram

What is ULLAS?

ULLAS stands for Understanding of Lifelong Learning for All in Society. It is also known as the Nav Bharat Saaksharta Karyakram (New India Literacy Programme).

It is a centrally sponsored scheme launched by the Government of India to provide educational opportunities to non-literate people aged 15 years and above, particularly those who missed formal schooling.

  • Implementing ministry: Ministry of Education.
  • Implementation period: Financial years 2022–23 to 2026–27.
  • Total financial outlay: ₹1,037.90 crore over five years.
  • Vision: Jan Jan Saakshar — making every person literate.
  • Approach: Community participation, volunteerism and technology-enabled learning.

The programme aligns with the National Education Policy (NEP) 2020, which emphasises adult education and lifelong learning.

Five major components of ULLAS

  1. Foundational Literacy and Numeracy

Enables learners to read, write, understand basic text and perform simple mathematical calculations.

  1. Critical Life Skills

Includes financial literacy, digital literacy, legal awareness, healthcare, child care, family welfare and disaster management.

  1. Basic Education

Provides opportunities to attain educational equivalency at preparatory, middle and secondary levels.

  1. Vocational Skills

Develops practical skills that can improve employability, livelihoods and income-generating opportunities.

  1. Continuing Education

Encourages lifelong learning through further courses in subjects such as science, arts, technology, culture and other areas of interest.

Source: Ministry of Education and Press Information Bureau.

How is the scheme implemented?

  • Volunteerism: Volunteers support adult learners in acquiring literacy skills.
  • Digital learning: The ULLAS mobile application provides educational content and learning resources.
  • Community participation: Schools and other community institutions can function as learning centres, called Samajik Chetna Kendras.
  • Assessment and certification: Learners can demonstrate their foundational literacy and numeracy through the Functional Literacy and Numeracy Assessment Test (FLNAT). Certification is supported through the National Institute of Open Schooling (NIOS) framework.

Significance of ULLAS for India

Social empowerment: Literacy enables people to understand their rights, access public services and participate more effectively in democratic processes.

Women’s empowerment: Adult education can improve women’s independence, financial decision-making and access to information.

Economic development: Numeracy, digital and vocational skills can support employment, entrepreneurship and better livelihoods.

Digital inclusion: Digital literacy helps citizens use online banking, digital payments and government services safely.

Intergenerational benefits: Educated adults are better equipped to support children’s education and encourage learning within families.

Inclusive development: The scheme creates learning opportunities for people who were unable to complete formal schooling, supporting the principle of lifelong learning.

Challenges in achieving universal literacy

  • Digital divide: Limited access to smartphones, internet connectivity and digital skills may restrict participation.
  • Time constraints: Adults engaged in daily-wage work, household responsibilities or caregiving may struggle to attend classes.
  • Regional disparities: Differences in language, educational infrastructure and social conditions affect implementation.
  • Retention and learning outcomes: Enrolment alone does not ensure that learners retain or apply their skills in everyday life.
  • Volunteer availability: The quality and continuity of learning depend partly on sustained volunteer participation.
  • Beyond basic literacy: Learners also need opportunities to apply their skills through further education, employment and access to public services.

Important facts for UPSC Prelims

Feature

Key fact

Full form

Understanding of Lifelong Learning for All in Society

Target group

Non-literate individuals aged 15 years and above

Ministry

Ministry of Education

Scheme type

Centrally Sponsored Scheme

Duration

2022–23 to 2026–27

Five components

Foundational literacy and numeracy, critical life skills, basic education, vocational skills and continuing education

Assessment

Functional Literacy and Numeracy Assessment Test (FLNAT)

Policy alignment

National Education Policy, 2020

Motto

Jan Jan Saakshar

 

 

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