1. IIT-Delhi’s Breakthrough in Quantum Communication – Science and Technology
Why in News?
The Ministry of Defence announced that researchers from IIT-Delhi and the Defence Research and Development Organisation (DRDO) have successfully demonstrated Quantum Key Distribution (QKD) over 1 km in free space—a significant step in India’s pursuit of quantum-secure communications.
Key Takeaways
Aspect
Details
What was achieved?
Quantum Key Distribution (QKD) over 1 km in open air (free space)
Secure Key Rate
240 bits per second
Error Rate (QBER)
< 7% – acceptable for real-world communication
Developed by
IIT-Delhi + DRDO
Strategic Goal
Enable quantum-secure communication for national defence, finance, and telecom sectors
What Is Quantum Communication?
A method of communication based on principles of quantum mechanics, especially:
Quantum entanglement
Heisenberg’s uncertainty principle
Main Benefit: Unhackable communication
Any attempt to eavesdrop introduces detectable changes, alerting both sender and receiver.
Quantum Key Distribution (QKD) – Explained
What It Is
QKD allows two parties to share an encryption key securely using quantum properties of photons
What It Is Not
QKD does not encrypt messages, only secures the keys used for encryption
Two Main Types of QKD
Type
Description
Prepare-and-Measure QKD
One party sends photons prepared in specific states; the receiver measures them (e.g., BB84 protocol)
Entanglement-Based QKD
Uses entangled photon pairs; any interference breaks the entanglement, alerting users
Significance of the 1 km Free-Space QKD Demo
Why It Matters
Implications
From fibre to air
Unlike fibre-based QKD (limited to ~100–150 km), free-space QKD works between buildings or satellites
Satellite Potential
A step toward satellite-based QKD, enabling secure global communication
Real-world use
Suitable for defence, financial networks, critical infrastructure, and government communication
Resilience
Demonstrated performance even under atmospheric interference and noise
India’s Strategic Initiatives in Quantum Technology
Initiative
Description
National Quantum Mission (2023)
Launched with ₹6,000 crore+ funding for quantum research and quantum communication infrastructure
DRDO-IIT Collaborations
Focused on national defence applications of quantum tech
Future Goal
Develop a multi-node quantum-secure network across India, covering cities, industries, and strategic defence zones
Global Context
Country
Status
China
Operational quantum satellite (Micius), first intercontinental QKD
USA
Investing in quantum internet and cryptography
India
Entering phase of real-world QKD deployment through academic-defence partnerships
Exam Connect – Possible Questions
Prelims
Which of the following best describes Quantum Key Distribution (QKD)? A. A method of encrypting messages using classical RSA algorithms B. A technique for secure key sharing using properties of quantum mechanics C. A satellite-based GPS service D. A type of blockchain encryption method Answer: B. A technique for secure key sharing using properties of quantum mechanics
In the context of quantum communication, what is ‘quantum entanglement’? A. A theory explaining the speed of light B. A condition where two particles remain correlated regardless of distance C. A form of digital storage D. A type of encryption standard in 4G networks Answer: B. A condition where two particles remain correlated regardless of distance
Which of the following correctly pairs the country with its quantum communication achievement? A. China – BB84 Protocol B. USA – Quantum satellite (Micius) C. India – 1 km free-space QKD demo D. Germany – Development of GPS using quantum clocks Answer: C. India – 1 km free-space QKD demo
Mains
“What is Quantum Key Distribution (QKD)? Discuss its advantages and strategic implications in the context of India’s cybersecurity requirements.” (250 words)
“Evaluate the importance of indigenous quantum technology developments in ensuring secure communication networks in India.” (250 words)
“With the advancement of quantum communication, traditional cryptographic systems may become obsolete. Examine this statement in the context of India’s preparedness.” (250 words)
2. India Post Payments Bank Wins Digital Payments Award 2024–25 – Economy
Why in News?
The India Post Payments Bank (IPPB) has been awarded the Digital Payments Award 2024–25 by the Department of Financial Services (DFS), Ministry of Finance. The award recognizes IPPB’s efforts in promoting digital payments and inclusive banking across India.
Key Takeaways
Feature
Details
Awarding Body
Department of Financial Services, Ministry of Finance
Entity Recognized
India Post Payments Bank (IPPB)
Launched
1st September 2018
Ownership
100% Government of India, under the Department of Posts
Objective
Financial inclusion and last-mile digital banking access using India Post’s nationwide network
What Is a Payments Bank? (Conceptual Clarity)
Feature
Description
Regulation
Licensed by RBI under the Banking Regulation Act, 1949
Deposit Limit
Can accept deposits up to ₹2 lakh per customer (as per current RBI norms)
Limitations
Cannot offer loans or credit cards
Primary Services
Deposits, remittances, digital payments, UPI, mobile banking, bill payments
Examples
IPPB, Airtel Payments Bank, Paytm Payments Bank, Fino Payments Bank
Core Functions of IPPB
Service Type
Description
Deposits
Savings and current accounts up to ₹2 lakh
Payments
UPI, IMPS, NEFT, mobile banking, micro-ATM, QR payments
Remittances
Domestic money transfers using Aadhaar or account number
Digital Infrastructure
Operates via mobile apps, counters, micro-ATMs, and interactive voice response (IVR)
Aadhaar Integration
QR cards + biometric verification for authentication and transactions
Scale & Reach
Operates through 165,000+ Post Offices, making it India’s largest banking network by reach.
Special focus on rural areas, underserved regions, and digitally excluded populations.
Empowers postal workers (Gramin Dak Sevaks) as banking correspondents to deliver doorstep services.
Why the Recognition Matters
Area
Impact
Financial Inclusion
Empowers citizens in remote/rural India with basic digital banking access
Digital India Mission
Supports government’s push for cashless and inclusive economy
Women & Senior Citizens
Special outreach to groups often left out of formal banking
Innovation
Combines legacy postal infrastructure with modern fintech solutions
Exam Connect – Possible Questions
Prelims
Which of the following services can a Payments Bank offer? 1. Credit Cards 2. Personal Loans 3. Remittance Services 4. Savings Accounts Select the correct answer: A. 1 and 2 only B. 3 and 4 only C. 1, 3 and 4 only D. All of the above Answer: B. 3 and 4 only
Which of the following correctly describes the India Post Payments Bank (IPPB)? A. It is a cooperative bank jointly owned by RBI and India Post. B. It is a fully private-sector digital bank. C. It is a 100% Government-owned payments bank under the Department of Posts. D. It is an NBFC regulated by SEBI. Answer: C. It is a 100% Government-owned payments bank under the Department of Posts.
The deposit limit for a customer in a Payments Bank, as per RBI norms, is currently: A. ₹50,000 B. ₹1 lakh C. ₹2 lakh D. ₹5 lakh Answer: C ₹2 lakh
Mains
“Payments banks play a vital role in bridging the digital and financial divide in India. Discuss with special reference to the India Post Payments Bank.” (250 words)
“Evaluate the role of IPPB in promoting digital payments in rural India. How does it align with the goals of Digital India and financial empowerment?”(250 words)
“Public sector-led innovation in financial services can be a game changer for inclusion. Examine this statement in light of IPPB’s recent recognition.” (150 words)
3. Indian Railways Now Transports 1 in Every 5 Cars Made in India – Economy
Why in News?
In a remarkable shift towards sustainable logistics, Indian Railways now handles over 20% of India’s passenger vehicle (PV) dispatches—up from just 1.7% in 2014–15. In 2024–25, Indian Railways transported 10.41 lakh cars, and this figure is projected to reach 15 lakh cars annually.
Key Highlights
Feature
Detail
Rail Coefficient
Share of car transport by rail: 1.7% (2014–15) → 20%+ (2024–25)
Revenue Stream
Boosts non-passenger freight revenue for Indian Railways
Environmental Goal
Supports India’s target of net zero emissions by 2070
Inauguration
India’s largest auto cargo terminal launched at Maruti Suzuki’s Manesar plant, Haryana, with 4.5 lakh vehicle dispatch capacity
Policy & Infrastructure Reforms Driving the Shift
Automobile Freight Train Operator (AFTO) Policy
Liberalised to encourage private participation:
No registration fee (earlier ₹5 crore)
Minimum rake requirement reduced from 3 to 1
Makes it easier and cost-effective for manufacturers to use rail logistics.
Expansion of Terminals
New multi-modal terminals at:
Chitpur (WB), Penukonda (AP), Nasrala (Punjab) and others
Enhances regional auto freight capacity and connectivity.
New Transport Equipment
New Modified Goods (NMG) coaches introduced since 1995–96
Three new double-decker auto wagon types now deployed:
Increases vertical space utilization
Reduces unit cost of vehicle transportation
Significance and Strategic Impact
Area
Benefit
Environment
Rail transport cuts carbon footprint vs. road transport; aligns with India’s low-carbon logistics vision
Economy
Offers a cost-effective and scalable logistics mode for the growing automobile sector
Infrastructure Efficiency
Better use of underutilized railway capacity; reduces truck congestion on highways
Revenue Diversification
Helps Indian Railways move beyond passenger fare dependency by boosting freight revenue
Make in India Support
Supports auto exports and inter-state trade under PM Gati Shakti National Master Plan
Exam Connect – Possible Questions
Prelims
Which of the following is true regarding the Automobile Freight Train Operator (AFTO) policy? A. It restricts private participation in automobile freight. B. It mandates a minimum of three rakes for all operators. C. It requires a registration fee of ₹5 crore. D. It has been liberalised to reduce barriers for private sector logistics participation. Answer: D. It has been liberalised to reduce barriers for private sector logistics participation.
The Rail Coefficient in automobile transport refers to: A. Speed of train dispatches for goods B. Share of cars transported by rail as a percentage of total production C. Distance covered by trains in transporting cars D. The amount of fuel saved by using rail transport Answer: B. Share of cars transported by rail as a percentage of total production
Which of the following are advantages of rail-based car transportation over road transport? 1. Lower carbon emissions 2. Reduced logistics costs 3. Higher accident risk 4. Larger carrying capacity per unit Choose the correct option: A. 1, 2 and 4 only B. 2 and 3 only C. 1 and 3 only D. All of the above Answer: A. 1, 2 and 4 only
Mains
“Indian Railways is emerging as a key player in India’s green logistics transformation. Discuss the economic and environmental implications of increasing automobile freight via rail.” (250 words)
“How have policy reforms like the AFTO scheme enhanced the role of Indian Railways in the automobile sector supply chain? Evaluate with examples.” (250 words)
“Highlight the significance of multimodal infrastructure in achieving India’s net zero targets. Use examples from recent developments in Indian Railways.” (250 words)
4. What Is e-Raktkosh? – India’s National Blood Bank Management System – Governance
Why in News?
The Union Health Ministry plans to integrate the Rare Donor Registry with e-Raktkosh, India’s central digital platform for blood bank management. This aims to streamline rare blood group identification and improve emergency response in critical cases.
What Is e-Raktkosh?
Feature
Description
Type of Platform
Web-based integrated blood bank management system
Implemented By
National Health Mission (NHM), Ministry of Health & Family Welfare
Developed By
C-DAC (Centre for Development of Advanced Computing)
Launch Year
Initially rolled out in 2015–16, now expanded across the country
Coverage
Over 3,800 blood centers registered as of 2024
Core Objectives of e-Raktkosh
Ensure safe, adequate, and timely blood supply
Reduce turnaround time for blood availability
Minimize wastage of blood and components
Prevent unethical practices by blocking professional donors
Maintain a central donor repository
Improve coordination among blood banks through digital networking
Key Features and Modules
Component
Function
Biometric Donor Management
Tracks donor health and donation frequency to prevent over-donation
Centralized Blood Inventory System
Real-time tracking of blood stock, groups, and availability across states/districts
Bio-Medical Waste Module
Ensures proper disposal of expired/discarded blood and by-products
Rare Blood Group Registry
Maintains a list of rare blood donors, useful during emergencies or rare transfusion needs
Alerts & Notifications
Sends automated updates to stakeholders, donors, and hospitals
Aadhaar Integration
Promotes accountability and transparency in donations
Significance of Integration with Rare Donor Registry
Enables faster identification of rare group donors (e.g., Bombay blood group)
Improves response time in emergency transfusions
Reduces dependence on informal or manual donor networks
Supports AI-based forecasting of blood demand
Administrative Relevance
Area
Impact
Health Governance
Enhances real-time decision-making for public hospitals
Digital India Mission
Strengthens e-governance in the health sector
Welfare Delivery
Promotes equity and accessibility in life-saving services
Disaster Preparedness
Helps in rapid mobilization of blood during emergencies like earthquakes, floods, etc.
Challenges and Way Forward
Challenges
Suggestions
Digital Illiteracy in Rural Areas
Launch awareness campaigns through ASHAs and PHCs
Connectivity Issues
Expand e-Raktkosh through offline modules or SMS-based alerts
Interoperability with Private Hospitals
Mandate registration and data sharing by private blood banks
Exam Connect – Possible Questions
Prelims
Which of the following statements regarding e-Raktkosh is/are correct? 1.It is a blockchain-based blood donation tracking system. 2.It is developed by C-DAC under the National Health Mission. 3.It facilitates management of rare blood group donor registries. Select the correct option: A. 1 and 2 only B. 2 and 3 only C. 1 and 3 only D. All of the above Answer: B. 2 and 3 only
The primary objective of the e-Raktkosh platform is to: A. Provide insurance for organ transplants B. Manage inventory and supply of blood and components C. Track COVID-19 vaccination coverage D. Monitor drug prices under Jan Aushadhi Yojana Answer: B Manage inventory and supply of blood and components
Which of the following is NOT a component of e-Raktkosh? A. Biometric donor management B. Aadhaar-enabled direct benefit transfers C. Biomedical waste management D. Rare blood group donor registry Answer: B. Aadhaar-enabled direct benefit transfers
Mains
“Discuss how e-Raktkosh enhances transparency and efficiency in India’s blood donation and management system. What are the challenges to its universal adoption?” (250 words)
“Evaluate the role of e-health platforms like e-Raktkosh in improving healthcare delivery in India. How do such platforms support the goals of the National Health Mission?”(250 words)
“Public health emergencies demand robust digital infrastructure. Examine the role of digital registries like e-Raktkosh in improving India’s emergency response capabilities.” (150 words)
5. India to Integrate Rare Blood Donor Registry with e-RaktKosh for Safer Transfusions – Governance
Why in News?
The Ministry of Health and Family Welfare is planning to integrate the Rare Donor Registry of India (RDRI) with e-RaktKosh, the national digital platform for blood bank management. This move aims to streamline the identification and accessibility of rare blood types, especially during medical emergencies.
Key Takeaways
Aspect
Detail
Platform Integration
Rare Donor Registry (RDRI) to be linked with e-RaktKosh, enabling real-time search for rare blood types
Target Beneficiaries
Patients with conditions like thalassemia, sickle cell anemia, and hemophilia who often require rare blood groups
Donor Data
RDRI maintains a list of over 4,000 donors, tested for 300+ rare blood markers
Implementing Agencies
RDRI is developed by ICMR and NIIH (National Institute of Immunohaematology)
Digital Governance
Aimed at reducing turnaround time, increasing transfusion safety, and enhancing public health preparedness
What Is the Rare Donor Registry of India (RDRI)?
Feature
Description
Purpose
Centralized digital repository for rare blood group donors
Developed By
Indian Council of Medical Research (ICMR) and National Institute of Immunohaematology (NIIH)
Scope
Focuses on phenotypically and genetically rare blood group profiles
Importance
Critical for matching rare donors in complex transfusion scenarios, especially in multi-transfused patients like those with blood disorders
Role of e-RaktKosh in the Integration
Function
Benefit
Real-time Blood Inventory
Helps locate the nearest available matching unit of rare blood
Donor Management System
Biometric and Aadhaar-based tracking to prevent over-donation
Nationwide Network
Connects over 3,800 blood banks, expanding the search base
Dashboard & Alerts
Notifies hospitals and blood banks about available rare group units in emergencies
Public Health Impact
Area
Contribution
Emergency Medical Care
Rapid access to compatible blood can be life-saving in trauma or rare disease situations
Transfusion Medicine
Supports personalized and precise transfusions
Chronic Disease Management
Enables routine planning of transfusions for conditions like thalassemia
Health Equity
Improves access to rare blood even in remote or underserved regions
Innovations in Blood Disorder Diagnosis
Point-of-Care Testing under development for:
Thalassemia
Sickle Cell Disease
Affordable diagnostic tools for hemophilia also underway
These tools will complement the integrated database by quickly identifying need-based matches
Challenges and Recommendations
Challenge
Recommendation
Limited public awareness of rare blood donation
Nationwide campaigns via schools, colleges, NGOs
Digital divide in rural hospitals
Enable offline integration and helpline support
Data protection concerns
Ensure end-to-end encryption and Aadhaar compliance
Exam Connect – Possible Questions
Prelims
Which of the following institutions developed the Rare Donor Registry of India? A. AIIMS and DRDO B. ICMR and NIIH C. NITI Aayog and C-DAC D. WHO and Ministry of Health Answer: B. ICMR and NIIH
What is the primary objective of integrating RDRI with e-RaktKosh? A. To prevent illegal organ trading B. To increase organ donations C. To enable faster access to rare blood types during transfusions D. To improve tuberculosis tracking Answer: C. To enable faster access to rare blood types during transfusions
Which of the following conditions commonly require rare blood type transfusions? 1. Sickle Cell Anemia 2. Thalassemia 3. Diabetes 4. Hemophilia Select the correct answer: A. 1 and 2 only B. 2 and 3 only C. 1, 2 and 4 only D. All of the above Answer: C. 1, 2 and 4 only
Mains
“The integration of India’s Rare Donor Registry with e-RaktKosh is a step forward in building a responsive healthcare system. Discuss its potential impact on public health delivery in India.” (250 words)
“Evaluate the role of digital health platforms like e-RaktKosh in addressing critical gaps in emergency medical care in India.” (250 words)
“Discuss the importance of rare blood donor databases and their integration with public health systems in improving transfusion safety.” (150 words)
6. Flash Flood in Subarnarekha River Affects Over 50,000 in Odisha -Environment
Why in News?
A devastating flash flood in the Subarnarekha River recently inundated several villages in Balasore district, Odisha, affecting more than 50,000 residents. The event highlights growing flood risks in eastern India due to intense monsoon episodes and inadequate river basin management.
Key Takeaways
Feature
Description
Origin
Near Nagri village, Ranchi District, Jharkhand (elevation ~600 m)
Length
~395 km
Direction of Flow
Eastward, eventually draining into the Bay of Bengal
States Covered
Jharkhand, Odisha, and parts of West Bengal
Name Significance
“Subarnarekha” means “Streak of Gold” — refers to gold traces once found in its sands
Important Tributaries
Tributary
Direction
Region
Kanchi
Left bank
Jharkhand
Karkari
Left bank
Odisha
Kharkai
Major right-bank tributary
Meets Subarnarekha near Jamshedpur
Basin and Hydrology
Parameter
Details
River Basin Coverage
~19,500 sq. km across Jharkhand, Odisha, and West Bengal
Climate Influence
Dominated by Southwest Monsoon (June–October)
Industrial Areas
Passes through mining and industrial zones like Jamshedpur (Tata Steel hub)
Riverbed
Carries heavy metal deposits, including traces of gold and copper
Environmental & Disaster Relevance
Causes of Flash Flooding
Sudden cloudbursts or intense rainfall in upstream Jharkhand
Deforestation and soil erosion in the catchment area
Mining activities disrupting natural drainage
Encroachment along riverbanks and urban runoff
Recent Flood Impact
Villages inundated in Balasore district, Odisha
Damage to crops, homes, and infrastructure
Over 50,000 people displaced or affected
Disaster Management Implications
Need
Response
Early Warning Systems
Install real-time river gauges and automated alerts
River Basin Management
Implement Integrated River Basin Planning (IRBM) across state boundaries
Eco-Restoration
Reforest upstream slopes to reduce runoff and erosion
Infrastructure Planning
Avoid development in flood-prone floodplains
Exam Connect – Possible Questions
Prelims
Which of the following rivers flow into the Bay of Bengal and pass through Jharkhand? A. Mahanadi B. Subarnarekha C. Krishna D. Ghaggar Answer: B . Subarnarekha
Which among the following is a tributary of the Subarnarekha River? A. Gandak B. Kharkai C. Betwa D. Damodar Answer: B. Kharkai
The term “Subarnarekha” refers to: A. A river known for its role in the Salt Satyagraha B. A glacier in the Karakoram Range C. A river historically linked with traces of gold D. A mountain peak in the Eastern Ghats Answer: C. A river historically linked with traces of gold
Mains
“Discuss the geographical features and environmental significance of the Subarnarekha River. How do monsoonal patterns and human activity contribute to its flooding?”(250 words)
“Riverine flash floods have become more frequent due to climate variability and anthropogenic pressure. Analyze the causes and mitigation strategies with reference to the Subarnarekha basin.” (250 words)
“Integrated river basin management is essential for flood mitigation in eastern India. Suggest policy-level reforms with reference to inter-state rivers like Subarnarekha.” (250 words)
7. What is Net Interest Margin (NIM) and Why Is It Important for Banks? – Economy
Why in News?
Indian Overseas Bank (IOB), a public sector lender, has taken strategic steps to manage the impact of the recent repo rate cut by the RBI on its Net Interest Margin (NIM), a key metric of banking profitability.
Definition: What is Net Interest Margin (NIM)?
Feature
Description
Full Form
Net Interest Margin
Meaning
A measure of how efficiently a bank earns income from its interest-bearing assets relative to the interest it pays on deposits and borrowings
Type
Expressed as a percentage of average earning assets
Indicates
The profitability of a bank’s core lending operations
Formula and Example
NIM = (Interest Income – Interest Expense) / Average Earning Assets
Example Calculation:
Interest Income = ₹8,000 crore
Interest Expense = ₹6,000 crore
Average Earning Assets = ₹64,000 crore
NIM = (8,000 – 6,000) / 64,000 = 0.03125 or 3.125%
What Does NIM Tell Us?
NIM Value
Interpretation
High Positive NIM
Bank is efficiently earning from loans and investments
Low or Negative NIM
Poor interest spread; could indicate inefficiency or bad asset quality
Difference Between NIM and GIM (Gross Interest Margin)
Metric
Formula
Focus
NIM
(Interest Income – Interest Expense) / Average Earning Assets
Measures profitability relative to asset size
GIM
Interest Income – Interest Expense
Measures total interest profit without asset size consideration
Factors Affecting NIM
Factor
Impact
Repo Rate Changes
Impacts lending and deposit rates; tighter margins in low-rate regimes
Asset Mix
Riskier loans may offer higher returns, improving NIM (but with higher default risk)
Cost of Funds
Higher deposit rates shrink the interest spread
Credit Risk
Non-performing assets (NPAs) reduce income and affect NIM
Operational Efficiency
Lower operating costs can help maintain a healthy NIM
Competition
Limits banks’ ability to raise interest rates on loans
Regulations
SLR/CRR requirements can lower the earning portion of assets
Relevance for Indian Banks and Economy
NIM is a key performance indicator (KPI) for banks in financial reports.
A declining NIM may signal:
High cost of funds
Inefficiency
Low lending demand
RBI monitors it while assessing:
Monetary policy impact
Banking sector stability
Profitability of public sector banks (PSBs)
Exam Connect – Possible Questions
Prelims
Net Interest Margin (NIM) is a measure of: A. Total profit of a bank including fees and commissions B. Percentage of non-performing assets in a bank’s portfolio C. Difference between interest earned and interest paid, as a percentage of earning assets D. Total interest expense over total liabilities Answer: C. Difference between interest earned and interest paid, as a percentage of earning assets
Which of the following factors directly influence a bank’s Net Interest Margin (NIM)? 1. Repo rate 2.Credit risk 3. Size of the bank’s equity capital 4. Operational cost efficiency Choose the correct answer: A. 1 and 2 only B. 1, 2 and 4 only C. 2 and 3 only D. All of the above Answer: B 1, 2 and 4 only
Which of the following formulas correctly represents Net Interest Margin (NIM)? A. (Operating Income – Operating Expense) / Total Assets B. (Interest Income – Interest Expense) / Average Earning Assets C. (Gross Profit – Net Profit) / Equity D. (Interest Income – Non-interest Income) / Total Deposits Answer: B. (Interest Income – Interest Expense) / Average Earning Assets
Mains
“What is Net Interest Margin (NIM), and why is it a critical metric for evaluating the profitability of Indian banks? Examine how monetary policy decisions impact NIM.” (250 words)
“Discuss the significance of operational efficiency and asset quality in maintaining a healthy NIM for public sector banks.”(250 words)
“Monetary policy transmission affects not just credit growth but also the financial health of banks. Analyze with respect to Net Interest Margin (NIM).” (250 words)
8. Global Banks Surge Fossil Fuel Financing, Threatening Net Zero Goals – Environment
Why in News?
The 2025 Fossil Fuel Finance Report by the Banking on Climate Chaos Coalition reveals that the world’s 65 largest banks invested $869 billion in fossil fuel companies in 2024, a 22.8% increase from 2023. This rise undermines global net-zero goals, especially as several major banks—including India’s SBI—backtrack on climate finance commitments.
Key Takeaways
Aspect
Details
Total Fossil Fuel Financing (2024)
$869 billion, up from $707 billion in 2023
Top Contributor
JPMorgan Chase: $53.5 billion (up by $15 billion)
India’s SBI
$2.62 billion in fossil fuel finance in 2024, despite a net-zero target by 2055
Global Trend
US and European banks rolling back their net-zero policy frameworks
Contradiction
Financial flows to fossil fuels sharply contrast with stated climate pledges
What is Fossil Fuel Financing
Definition: Loans, bonds, or equity investments provided by banks or financial institutions to companies involved in:
Coal mining
Oil and gas exploration
Petroleum refining and distribution
Impact: Encourages further extraction and consumption of fossil fuels, increasing GHG emissions and climate vulnerability.
India’s Role in Fossil Fuel Financing
Bank
2024 Financing
Stated Goal
State Bank of India (SBI)
$2.62 billion
Net zero by 2055
Coal Exclusion Gap: Most Indian banks lack a coal exclusion policy.
RBI and SEBI should monitor and penalize greenwashing
Global Alignment
Follow initiatives like Glasgow Financial Alliance for Net Zero (GFANZ)
Exam Connect – Possible Questions
Prelims
Which of the following correctly defines ‘Net Interest Margin’ (NIM)? A. Difference between gross income and capital gains B. Total equity divided by interest income C. Difference between interest earned and interest paid, divided by average earning assets D. None of the above Answer: C . Difference between interest earned and interest paid, divided by average earning assets (Note: This connects to a previous topic and reinforces economic linkage.)
Which Indian public sector bank was recently highlighted in the Fossil Fuel Finance Report 2025 for its continued financing of fossil fuels? A. Punjab National Bank B. Canara Bank C. State Bank of India D. Union Bank of India Answer: C. State Bank of India
Which of the following factors contribute to increased fossil fuel financing? 1. Lack of coal exclusion policies 2. Policy rollbacks by banks 3. Mandatory ESG disclosures 4. Rising global temperatures Select the correct option: A. 1 and 2 only B. 2 and 3 only C. 1, 2 and 4 only D. All of the above Answer: C. 1, 2 and 4 only
Mains
“The rise in fossil fuel financing by global banks contradicts their net-zero claims. Critically analyze the implications of this trend for climate action, with a special focus on India’s financial institutions.” (250 words)
“Discuss the role of the financial sector in achieving India’s climate goals. What reforms are needed to align bank lending with the net-zero roadmap?” (250 words)
“Voluntary climate pledges by institutions are insufficient without regulatory enforcement. Examine this statement in light of the Fossil Fuel Finance Report 2025.” (250 words)
