What to Read in Indian Express Editorial( Topic and Syllabus wise)

Editorial 1 : A Shift in Stance

 

Context: Lowering of Repo Rate by RBI  

 

Introduction: RBI lowered the GDP growth forecast to 6.5% for FY26 from 6.7% earlier. Analysts’ estimate that further moderation to ~6.2% due to direct and indirect impacts of global trade tensions.

 

Factors Impacting Growth

• Direct Impact of Trade War: The trade war is estimated to reduce GDP by 0.2–0.3% due to tariff-related disruptions.
• Indirect Impact
  1. Slowdown in global growth and capital flows to emerging markets.
  2. Tepid private sector investment due to investor caution.
• Supportive Domestic Factors
  1. Normal monsoon and robust agricultural production boost the rural demand.
  2. Lower income tax burden and moderated food inflation supporting consumption.

 

Inflation Trends

• Current Inflation Dynamics
  1. CPI Inflation: Fell to 3.6% (Feb 2025) and is projected to stay below 4% in the near term.
  2. Key Drivers
     • Sharp decline in food inflation (from 8.5% in Oct-Dec 2024 to 3.8% in Feb 2025).
     • Subdued core inflation (averaged 3.5% over the past year).
• RBI’s Inflation Outlook
  1. Revised FY26 CPI inflation projection to 4% from 4.2%.
  2. Risks: Weather-related shocks to food prices.

 

Monetary Policy Response

• Recent RBI Actions
  1. Rate Cut: 25 bps reduction in policy rate.
  2. Stance Shift: From neutral to accommodative, signalling further rate cuts.
• Future Expectations
  1. Additional Rate Cuts: 50 bps likely in FY26, potentially deeper if trade war worsens.
  2. Transmission Focus: Ensuring banks pass rate cuts to borrowers amid improved liquidity.

 

External Factors and Risks

• Global Trade War Impact
  1. US Tariff Comparison
     • India: 26%
     • China: 104% (including retaliatory tariffs)
     • Vietnam: 46%
     • Thailand: 36%
  2. Opportunity for India: Potential to increase US export market share if production shifts from higher-tariff countries.
• Currency Dynamics
  1. Recent Volatility
     • Rupee weakened by 4.4% (Oct 2024–Feb 2025), then partially recovered.
     • Chinese yuan depreciated 4.6% in the last 6 months.
  2. Forecast: Rupee is expected to trade at 88–89/USD by FY26-end.
  3. RBI Intervention is supported by $676 billion forex reserves which provides 11 months of import cover.

 

Global Central Bank Coordination

• US Federal Reserve: Potential rate cuts in 2025 if growth falters (easing pressure on RBI).
• Other Central Banks: ECB and BoE also expected to cut rates, aiding global liquidity.

 

Risks and Challenges

• Global Uncertainty: Muted capital inflows and currency pressures.
• Export Competitiveness: Need to capitalize on tariff differentials vs. peers.
• Domestic Investment: Sustaining private sector confidence amid global disruptions.

 

Conclusion: RBI’s accommodative stance aims to counterbalance external headwinds. RBI is managing inflation risks while supporting growth and stabilizing the rupee.

 

 

Editorial 2 : Raj Bhavan’s Boundaries

 

Context: Supreme Court’s judgment on Tamil Nadu governor.  

 

Office of the Governor

• Origin
  1. The office of the governor was retained post-independence to preserve national unity, stability, and security.
  2. Inspired by colonial-era structures but intended to act as a neutral constitutional figure.
• Founders’ Intent
  1. Jawaharlal Nehru: Advocated appointing eminent, apolitical individuals (e.g. academics) as governors.
  2. B.N. Rau (Constitutional Advisor): Proposed election by provincial legislatures via secret ballot.
  3. Sardar Patel: Suggested direct election by state citizens with impeachment provisions for misconduct.
  4. B.R. Ambedkar: Settled for nomination, arguing governors are nominal heads. Elections would be costly and redundant.

 

Current Challenges and Partisanship

• Overreach by Governors
  1. Instances: Delaying/denying assent to bills, interfering in appointments (e.g. vice-chancellors), editing customary addresses, and undermining legislative councils.
  2. Impact: Strained relations with opposition-led state governments (e.g. Tamil Nadu and Punjab cases).
• Partisan Behaviour
  1. Governors often act as agents of the central ruling party rather than impartial constitutional authorities.
  2. Security of tenure is lacking, making governors susceptible to political pressures.

 

Judicial Interventions: Key Supreme Court Rulings

• April 2025 Judgment (Justices Pardiwala & Mahadevan)
  1. Stripped governors of absolute discretion under Article 200 to withhold assent to bills.
  2. Imposed strict timelines for assent, reconsideration, or reserving bills for presidential review.
  3. Declared Tamil Nadu Governor’s actions (withholding 10 bills) as arbitrary and unconstitutional.
• Raghukul Tilek Case (1979): Affirmed that governors hold a high constitutional office, not subordinate to the Centre.
• Invocation of Article 142: Enabled the Court to enforce timelines, ensuring federal balance.

 

Constitutional and Structural Flaws

• Ambiguity in Discretion
  1. Discretionary powers (e.g. assent to bills) often misused for political ends.
  2. Five Principles of Discretion
     • Must be reasonable and cautious.
     • Cannot be exercised under external dictation.
     • Requires application of mind to facts.
     • Must avoid improper motives or irrelevant considerations.
     • Cannot be arbitrary or whimsical.
• Lack of Accountability
  1. No security of tenure or impeachment mechanism, unlike judges.
  2. Governors serve at the pleasure of the President, making them vulnerable to central influence.

 

Way Forward: Recommendations

• Security of Tenure: Provide fixed terms and removal safeguards, similar to judges, to ensure independence.
• Consultative Appointments: Implement Sarkaria Commission (1983) recommendations.
  1. Consult state CMs, Vice-President, and Lok Sabha Speaker during appointments.
  2. Give state CMs veto power over governor appointments.
• Codify Discretionary Powers: Legislate clear guidelines for assent to bills, aligning with Supreme Court timelines.
• Revive the Federal Intent
  1. Ensure governors act as neutral advisors, not political operatives.
  2. Strengthen state autonomy over 66 subjects in the Seventh Schedule.

 

Conclusion: The office of the governor was envisioned as a stabilizing force, but has devolved into a tool for central interference. Judicial interventions have curtailed abuses, but structural reforms are critical to restore the federal balance.