31 December 2025 Current Affairs (With PDF)

Stay updated with 31 December 2025 Current Affairs on this page! We bring you the most relevant and important news updates from around the world and India, specially curated for competitive exams and different entrance exams. Today's Current Affairs cover all significant national and international headlines, legal updates, economic news, and environmental highlights to boost your preparation. With our crisp, to-the-point coverage, you can confidently tackle current affairs questions in your exams.

3 Years of India-Australia Economic Cooperation and Trade Agreement (Ind-Aus ECTA)

The India–Australia Economic Cooperation and Trade Agreement (Ind-Aus ECTA) has completed three years of implementation since December 2022.

About Ind-Aus ECTA

• Type: Bilateral Free Trade Agreement (FTA).
• Signed on: 2 April 2022.
• Implemented from: December 2022.
• Nature: “Early harvest” agreement focusing on quick liberalisation of goods trade, with limited commitments in services and investment.
• Future Prospect: Provides a foundation for a more comprehensive Comprehensive Economic Cooperation Agreement (CECA).

Key Features of Ind-Aus ECTA

1. Tariff Liberalisation in Goods:

• Australia: Duty-free access for Indian exports on over 95% of tariff lines from day one; 100% by January 2026.
• India: Gradual tariff reduction on Australian exports; sensitivity maintained for agriculture, dairy, and wine.
• Impact: Protects domestic producers while promoting trade adjustment.

2. Rules of Origin (RoO) & Trade Facilitation:

• Prevents misuse and trans-shipment.
• Simplified customs procedures reduce costs and delays, benefiting exporters and MSMEs.

3. Services & Mobility:

• Limited but notable provisions for business visitors, contractual service suppliers, and professionals.
• Cooperation in IT, education, and professional services, with deeper liberalisation reserved for CECA.

4. Investment & Safeguards:

• Provisions for investment promotion and protection.
• Safeguard mechanisms to address sudden import surges affecting domestic industries.

Significance of India–Australia Relationship under ECTA

1. Strategic & Geopolitical Significance:

• Shared vision of a free, open, and rules-based Indo-Pacific.
• Cooperation under Australia–India Indo-Pacific Oceans Initiative Partnership (AIIPOIP) enhances maritime governance and regional stability.

2. Strategic Alliances & Security Cooperation:

• Both nations are core QUAD members (with US & Japan).
• Mutual Logistics Support Agreement (MLSA): Reciprocal military base and logistics access.
• Joint military exercises: Malabar (QUAD), AUSINDEX (bilateral).

3. Multilateral Alignment:

• Close coordination in G20, East Asia Summit (EAS), Indian Ocean Rim Association (IORA).

4. Supply Chain & Critical Minerals:

• Partners in Supply Chain Resilience Initiative (SCRI) with Japan.
• Australia supplies lithium, cobalt, and rare earth elements, critical for India’s EV mission, battery manufacturing, and clean energy transition.

Water Guardians: A Local Fight Against Desertification

In Hungary’s semi-arid Homokhátság region, a grassroots initiative led by local farmers and volunteers, called ‘Water Guardians’, is attempting local water restoration to counter desertification and sustain livelihoods.

About the Initiative

• The Water Guardians focus on retaining water locally, rather than letting it flow away unused, to support soil moisture, agriculture, and vegetation.
• It addresses rapid desertification in Central Europe, driven by climate change, declining groundwater levels, and unsustainable land and water management.

What is Desertification?

• Desertification is land degradation in arid, semi-arid, and dry sub-humid areas caused by human activities and climatic variations.
• Effects include loss of soil productivity, reduced vegetative cover, and ecosystem degradation.
• Globally, 250 million people and over 4 billion hectares of land are affected.

Causes of Desertification

• Climate Change: Higher temperatures increase evaporation, reduce soil moisture, and dry surface layers.
• Erratic Rainfall & Droughts: Weakens vegetation, soil regeneration, and natural water cycles.
• Declining Groundwater Levels: Excessive extraction, river channelisation, and drained wetlands reduce recharge.
• Unsustainable Agriculture: Overgrazing, monocropping, and heavy chemical use degrade soil fertility.
• Deforestation: Tree removal increases surface runoff, soil erosion, and loss of root binding.

Impacts

• Environmental: Loss of biodiversity, soil erosion, dust storms, degraded ecosystem services.
• Economic: Reduced agricultural yields, declining farmer incomes, higher irrigation and land restoration costs.
• Social: Food insecurity, nutritional stress for rural communities.
• Climate: Less carbon sequestration, hotter soils, accelerating climate change.

Measures to Combat Desertification

1. UNCCD & Land Degradation Neutrality (LDN):

• Balances land degradation with restoration by 2030.

2. United Nations Convention to Combat Desertification (UNCCD):

• Only legally binding framework addressing desertification and drought; 197 Parties including EU and India.

3. India’s Initiatives:

• National Afforestation Programme (NAP): Restores degraded forests and adjoining areas via community participation.
• Aravalli Green Wall Initiative: Expands green cover in a 5 km buffer around the Aravalli range across 29 districts.
• National Action Plan to Combat Desertification, 2023: Targets restoration of 26 million hectares of degraded land by 2030.

The US Push to Redefine the WTO

The United States has outlined proposals to reform the World Trade Organization (WTO), aiming to make decision-making more flexible, ensure a level playing field, and limit special privileges for developing countries.

Key Highlights of US Proposed Reforms

1. Decision-Making – Plurilateral Approach:

• US argues that consensus among 166 WTO members is unrealistic for new trade rules.
• Supports plurilateral agreements among willing members on specific sectors/issues for faster rule-making.
• Plurilateral agreements allow smaller groups to cooperate without binding the entire WTO membership.

2. Special & Differential Treatment (S&DT):

• US seeks to restrict S&DT largely to least developed countries (LDCs).
• All other countries would face uniform obligations regardless of development gaps.
• Deviations would require strict justification.

3. Level Playing Field:

• Focus on trade distortions caused by non-market practices, overcapacity, and state interventions.
• Advocates transparency and stricter compliance notifications as remedies.

4. Most-Favoured-Nation (MFN) Principle:

• US questions the relevance of MFN in the era of divergent economic systems.
• Argues MFN imposes one-size-fits-all liberalization, limiting flexibility in trade relations.
• Supports wider departures to allow differentiated bilateral/multilateral trade arrangements.
• MFN ensures all WTO members receive equal trade benefits, e.g., tariffs and market access.

5. Role of WTO Secretariat:

• US criticizes the Secretariat for overstepping administrative mandate.
• Claims it expands monitoring, commentary, and research projects without member authorization.

Concerns with US-Proposed Reforms

1. MFN Principle Erosion:

• India and other developing countries must oppose weakening MFN, which ensures predictability and fairness.
• Dilution could entrench power-based trade relations favoring large economies.

2. Trade Imbalances:

• Addressing trade imbalances is important but should not dominate WTO policies.
• Structural and macroeconomic factors must be considered.

3. Economic Security:

• Security concerns should be addressed multilaterally within WTO frameworks.
• Safeguards agreements could be expanded to include strategic vulnerabilities.

4. S&DT Reform:

• Restricting S&DT only to LDCs is too rigid.
• Differentiation based on income levels or development indicators offers a more balanced approach.

India Poised to Become $26 Trillion Economy by 2047–48

A report by Ernst & Young (EY) projects India to become a $26 trillion economy by 2047–48, with per capita income exceeding $15,000, maintaining an average growth rate of ~6% per annum.

Current Status of India’s Economy

1. Growth Momentum:

• Real GDP grew 8.2% in Q2 FY 2025-26, up from 7.8% in Q1 and 7.4% in Q4 FY 2024-25.
• Real GVA expanded by 8.1%, led by industrial and services sectors.

2. Services Exports:

• Services exports reached $254.5 billion in 2021–22, growing 14% over the past two decades.
• IT & BPO contributed $157 billion, making India a global hub for technology services.

3. Global Capability Centres (GCCs):

• India hosts 1,500 GCCs (45% of global total), indicating scalable talent and emerging technology skills.

4. Digital Infrastructure:

• 1.2 billion telecom subscribers, 837 million internet users.
• Strong Digital Public Infrastructure drives digital payments, governance, and entrepreneurship.

Factors Driving Growth

1. Structural Reforms:

• Liberalisation, market orientation, and private capital have enhanced global competitiveness.

2. Services & IT Leadership:

• India positioned as the “office of the world” through IT, BPO, and technology adoption.

3. Digital Economy:

• Robust digital ecosystem enables innovations in digital payments, governance, and service delivery.

4. Demographics:

• ~26% of the population aged 10–24, offering a demographic dividend.

5. Urbanization & Infrastructure:

• Real estate contribution to GDP expected to rise from 8% to 18% by 2047.

6. FDI & Global Integration:

• Cumulative FDI inflows crossed $1.05 trillion, with record equity inflows in FY25.

7. Non-IT Services Potential:

• Sectors like education and healthcare expected to grow due to digital delivery and global skilled-labour shortages.

Challenges

• Trade & Global Uncertainties: Export headwinds, tariff barriers, and need for diversification.
• Infrastructure & Logistics: High costs and bottlenecks limit competitiveness.
• Climate & Sustainability: Balancing growth with environmental commitments.
• Global Risks: Geopolitical tensions, supply chain disruptions, technological competition.

Reforms & Initiatives Supporting Growth

• Aatmanirbhar Bharat: Strengthening domestic manufacturing and self-reliance.
• Ease of Doing Business 2.0: Deregulation and SME empowerment to foster India’s “Mittelstand.”
• Green Growth: National Hydrogen Mission, renewable energy expansion, electric mobility.
• Financial Inclusion: Jan Dhan Yojana, UPI, digital banking penetration.
• Global Integration: Trade diversification, strategic positioning amid geo-economic fragmentation.

Banking Fraud Amount Jumps 30% in April–September 2025

The RBI’s Trend and Progress of Banking in India 2024–25 reports that while the number of banking frauds has declined, the total value of frauds has surged by 30%, revealing structural and supervisory weaknesses.

Key Findings

1. Nature of Frauds:

• Card & internet frauds: 66.8% of total cases, highlighting vulnerabilities in digital banking.
• Advances-related frauds: 33.1% of total amount involved, showing high-value corporate loan risks.

2. Bank-wise Distribution:

• Private Banks: 59.3% of fraud cases.
• Public Sector Banks (PSBs): 70.7% of total fraud amount.

Reasons for Rise in Fraud Amounts

• Weak Credit Appraisal & Monitoring: Especially in consortium/multiple banking arrangements, enabling fund diversion.
• Delayed Recognition & Reporting: Losses accumulate over several years before detection.
• Governance Gaps: Limited accountability in sanctioning and restructuring large loans.
• High-Value Advances Fraud: Corporate loans inflate total fraud amounts despite fewer cases.
• Legacy Cases Re-evaluated: Compliance with Supreme Court judgment (27 March 2023) led to fresh reporting of large past frauds.

Impacts of Rising Banking Frauds

• Weakens bank balance sheets: Higher NPAs and provisioning.
• Erodes public confidence, especially in PSBs.
• Fiscal burden: Government recapitalisation diverts resources.
• Credit contraction: Banks become risk-averse, affecting MSMEs and productive sectors.

Government & RBI Initiatives

• Central Fraud Registry (CFR): Information sharing among banks to prevent repeat frauds.
• Early Warning Systems (EWS) & Red-Flagged Accounts (RFA): Early detection of stress and potential frauds.
• Insolvency & Bankruptcy Code, 2016: Strengthened credit discipline and recovery mechanisms.
• Financial Fraud Risk Indicator (FRI): Real-time monitoring technology to protect against cyber, UPI, and digital banking frauds.

Countries Raise Concern About ‘Fake Rabies Vaccine’ in India

Countries including the UK, US, and Australia issued advisories regarding a counterfeit batch of Abhayrab, a rabies vaccine manufactured by Indian Immunologicals Limited (IIL).

About Abhayrab & the Counterfeit Controversy

• Abhayrab: Cell-culture rabies vaccine in use since 2000, supplied in India and over 40 countries.
• Market Share: Around 40% of India’s human rabies vaccine market; used in government programmes, private hospitals, and by travellers.
• Counterfeit Batch: Detected internally by IIL in January 2025 with altered packaging; regulatory authorities were informed, and the batch removed from circulation.

Rabies: Risks and Public Health Concern

1. Transmission:

• Via saliva of infected animals—dogs, cats, bats, monkeys—through bites, scratches, or open wounds.

2. Symptoms:

• Fever, headache, nausea, hallucinations, hydrophobia.

3. Fatality:

• Almost 100% fatal once symptoms appear; post-exposure vaccination is the most reliable prevention.

4. Burden in India:

• National Rabies Control Program: 6,644 suspected human cases/deaths (2012–2022)
• WHO estimate: 18,000–20,000 deaths annually; India accounts for 36% of global rabies deaths, with two-thirds under age 15.

Ethical Perspectives

1. Public Health Ethics:

• Distributing fake vaccines violates non-maleficence (‘do no harm’).
• Undermines public trust and future vaccination programmes.

2. Professional Ethics in Medicine:

• Doctors administering vaccines may unknowingly breach ethical practice.
• Many medical professionals were victims, highlighting institutional, not individual, lapses.

3. Corporate and Manufacturing Ethics:

• Falsifying batch numbers and expiry dates breaches business ethics and legal obligations under the Drugs and Cosmetics Act, 1940.
• Deliberate deception prioritizing profit over human life is ethically indefensible.

4. Regulatory Ethics:

• CDSCO and state regulators failed in due diligence, reflecting governance and oversight lapses, comparable to the Ranbaxy data falsification case (2013).

Netaji Subhas Chandra Bose

The Prime Minister of India paid tribute to Netaji Subhas Chandra Bose on 30 December, commemorating the day in 1943 when he unfurled the Indian tricolour at Port Blair, displaying unmatched courage and valor.

Early Life

• Born on 23 January 1897 in Cuttack, Odisha.
• Studied at the University of Calcutta; later went to England to appear for the Indian Civil Services (ICS) exam.
• Abandoned ICS aspirations to dedicate himself to India’s independence struggle.

Political Career

• Joined the Indian National Congress (INC) advocating complete independence rather than moderate reforms.
• Elected INC President in 1938 and 1939, but resigned due to differences with Mahatma Gandhi and other leaders over non-violent strategies.

Contributions to Freedom Struggle

• Advocated leveraging Axis powers during World War II for India’s liberation.
• Escaped house arrest in 1941, traveled through Afghanistan to Germany seeking support from Adolf Hitler.
• In 1943, reached Japan and took command of the Indian National Army (INA), formed by Indian POWs and expatriates.
• INA’s campaigns and post-war trials had a psychological impact, weakening British authority and inspiring nationalist sentiment.

Death

• Died in a plane crash in Taiwan in August 1945.
• Circumstances remain mysterious and controversial.

Maiden Flight Test of Pinaka Long Range Guided Rocket (LRGR-120)

The Pinaka Long Range Guided Rocket (LRGR-120) was successfully flight-tested at the Integrated Test Range (ITR), Chandipur, Odisha.

About Pinaka LRGR-120

• Design & Development: Developed by the Armament Research and Development Establishment (ARDE) in collaboration with High Energy Materials Research Laboratory (HEMRL), with support from Defence Research and Development Laboratory (DRDL) and Research Centre Imarat (RCI).
• Range: The number “120” indicates its maximum strike range of approximately 120 km.
• Purpose: An extended-range, precision-guided rocket designed for the Pinaka Multiple Launch Rocket System (MLRS) of the Indian Army.
• Role in Modern Warfare: Enhances rapid response, precision strike capability, and operational effectiveness of the Indian Army.

Pinaka Multiple Launch Rocket System (MLRS)

• Function: A long-range artillery weapon system developed by DRDO for the Indian Army.
• Features: Rapid launch, high mobility, and precision targeting.
• Strategic Importance: Provides firepower superiority in modern battlefield scenarios.

Trials and Induction

• The maiden flight of the LRGR-120 was successfully conducted at ITR Chandipur.
• It has received clearance for induction into the Indian Army by Defence Acquisition Council (DAC).

Export Potential

• Procurement: Armenia has procured the Pinaka system.
• International Interest: European countries, including France, have shown interest, positioning Pinaka as a defence export success.

Sabarimala Temple Opens for Makaravilakku Festival

The Sabarimala Ayyappa Temple in Kerala reopened on 30 December 2025 for the Makaravilakku festival, marking the second phase of the annual pilgrimage season.

About Makaravilakku Festival

1. Significance:

• One of Kerala’s most sacred festivals, celebrated at Sabarimala Ayyappa Temple.

2. Timing:

• Observed on the first day of Makara Masam (Malayalam calendar), coinciding with Makara Sankranti.

3. Key Spiritual Events:

• Makara Jyoti: Appearance of the bright celestial star Sirius in the eastern sky.
• Makara Vilakku: Sacred light appearing thrice from the forests of Ponnambalamedu.
• Both are believed to be spiritually transformative, symbolizing the presence, blessings, and grace of Lord Ayyappa.

Key Rituals

• Kalamezhuthu Pattu: Ritualistic art and devotional songs invoking Lord Ayyappa.
• Nayattu Vili: Traditional call announcing the commencement of festival events.
• Guruthi: Offering performed before the closing of the shrine doors, representing divine protection and purification.

INSV Kaundinya

The Indian Naval Sailing Vessel (INSV) Kaundinya recently sailed on its maiden overseas voyage from Gujarat to Oman, retracing ancient maritime routes.

About INSV Kaundinya

• Design Inspiration: Modeled after a 5th century CE stitched ship, as depicted in the Ajanta Caves paintings.
• Name Origin: Named after Kaundinya, the Indian mariner who sailed across the Indian Ocean to Southeast Asia.
• Construction Technique: Built using traditional stitched shipbuilding methods, employing natural materials and techniques dating back centuries.
• Collaborating Bodies: A tripartite project involving the Ministry of Culture, Indian Navy, and Hodi Innovations.

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