March 2026

In short: India's schemes, budget and infrastructure this month — distilled for SI/Constable Prelims.

Current Affairs — India › Economy & Infrastructure · 18 min read · Free to read · English & Telugu

Bilingual study notes for the Andhra Pradesh Police SI & Constable exams (SLPRB AP) by AP Police Hub, a product of Anvil Academy.

The West Asia conflict's economic shockwaves dominated the month — an LPG shortage, a fall in gold prices, the Essential Commodities Act invoked for natural gas, and a new export-relief scheme — alongside NITI Aayog's Fiscal Health Index 2026, the BHAVYA industrial-park scheme, Modified UDAN, and MSP funding for cotton.

Ripe cotton bolls ready for harvest on a farm in Andhra Pradesh, South India — Cotton bolls ready for harvest, Andhra Pradesh — cotton sustains ~60 lakh farmers nationally, including in Andhra Pradesh, and India accounts for nearly 25% of global output · Mamichaelraj / Wikimedia Commons (CC BY-SA 4.0)

March 2026 — At a Glance

The escalating Iran–US–Israel conflict in West Asia was the dominant economic story of March 2026 — it triggered an LPG supply crunch, invoked the Essential Commodities Act for natural gas, sent gold prices sharply down, and prompted a new export-insurance scheme for Gulf-bound trade. Alongside this, the government rolled out big-ticket infrastructure schemes — the ₹33,660 crore BHAVYA industrial-parks scheme, a ten-year Modified UDAN regional-connectivity plan, and MSP support for cotton — while NITI Aayog released its second Fiscal Health Index ranking Indian states.

Headlines of the month

Government invokes the Essential Commodities Act, 1955 for natural gas as India — the world's 2nd-largest LPG consumer — faces a supply crunch; underground LPG storage covers under 2 days' consumption.
24-carat gold price in India falls from ~₹1.7 lakh to ~₹1.3 lakh per 10g since late January, driven by a rise in oil prices and interest-rate expectations amid the West Asia conflict.
₹497 crore RELIEF scheme launched to give exporters credit-insurance cover against West Asia disruptions; ₹1,718.56 crore MSP funding approved for cotton; rice fortification temporarily suspended on an IIT Kharagpur shelf-life study.
BHAVYA Yojna (₹33,660 crore, 100 industrial parks) and ten-year Modified UDAN (₹28,840 crore, 100 new airports from unserved airstrips) approved — India's biggest infrastructure pushes of the month.
NITI Aayog's Fiscal Health Index 2026 ranks Odisha the top state for the 2nd year running; Karnataka and Telangana slip from 'front runner' to 'performer'.
US launches Section 301 investigations into India over manufacturing overcapacity and forced-labour supply chains; Canadian PM's visit yields a $1.9 billion uranium deal; India extends its Myanmar pulses-import pact and ships diesel/fuel to Bangladesh and Sri Lanka.

1. West Asia Conflict — India's Economic Response

March 2026's biggest economic story was the fallout from the escalating US–Israel–Iran conflict in West Asia. For a state police exam, the relevant part is India's own supply, price and policy response — not the geopolitical or military details, which belong to UPSC Mains rather than this exam.

LPG shortage and the Essential Commodities Act

Why — India is the world's 2nd-largest LPG consumer (~3 million tonnes/month, 33 crore domestic connections); 90% of its LPG imports cross the Strait of Hormuz, and total underground storage (Mangaluru + Visakhapatnam caverns) holds barely 1.4 lakh tonnes — under 2 days' consumption.
Government action — Centre invoked the Essential Commodities Act, 1955, issuing a Natural Gas (Supply Regulation) Order — mandates 100% of past-6-month average supply to households/CNG/PNG, lower priority tiers (70–80%) for fertiliser plants and industry.
India's import dependence — LPG imports meet 60% of India's demand, up from 47% in 2015; imports tripled from 2011-12 to 2024-25 to ~20 million tonnes; India's Strategic Petroleum Reserve (auto-fuels) holds 53+ lakh tonnes, being expanded to 65+ lakh tonnes.

Gold prices fall; a new export-relief scheme for Gulf trade

Gold prices — 24-carat gold fell from ~₹1.7 lakh to ~₹1.3 lakh per 10g since late January — an unusual crisis pattern (gold normally rises in crises) explained by sharply higher oil prices pushing up inflation/interest-rate expectations, a stronger dollar, and a liquidity crunch triggering cascading sell-offs.
RELIEF scheme — ₹497 crore Resilience & Logistics Intervention for Export Facilitation (RELIEF) launched under the Export Promotion Mission, giving exporters to UAE/Saudi/Kuwait/Israel/Qatar/Oman/Bahrain/Iraq/Iran/Yemen enhanced ECGC credit-insurance cover (up to 95–100% risk coverage) against freight-cost spikes and war-related trade risk.
Impact on Indian industry — India imported $98.7 billion in goods from West Asia in 2025; disruption threatens steel/cement/fertiliser inputs (limestone, gypsum, sulphur), power-transmission copper wire, and the diamond-processing industry (India imports 40%+ of rough diamonds from the region).

India's regional support and other West Asia-linked measures

Rice fortification suspended — Government temporarily discontinued rice fortification under PMGKAY after an IIT Kharagpur study found micronutrient reduction and shortened shelf-life in Fortified Rice Kernels under prolonged storage (rice can stay in storage 2-3 years); foodgrain entitlements under PDS/ICDS/Mid-Day Meal are unaffected.
Regional fuel/food diplomacy — India shipped 5,000 tonnes diesel to Bangladesh (via the India-Bangladesh Friendship Pipeline) and 38,000 tonnes petroleum to Sri Lanka amid regional fuel-supply disruption; extended its Myanmar pulses-import pact by 5 years with an extra 1 lakh tonnes Tur dal permitted for 2026-27.
FDI relaxation for land-bordering countries — Cabinet partially relaxed Press Note 3 (2020) FDI restrictions for land-bordering countries (incl. China) in select manufacturing sectors (capital goods, solar inputs) — semiconductors remain restricted; investment up to 10% beneficial ownership allowed via automatic route.

2. Schemes, Funds & Infrastructure

BHAVYA Yojna — ₹33,660 crore for 100 industrial parks

What — Union Cabinet approved Bharat Audyogik Vikas Yojna (BHAVYA) — ₹33,660 crore for developing 100 plug-and-play industrial parks (100–1,000 acres each) nationwide, in partnership with states and private players, building on the National Industrial Corridor Development Programme (NICDP).
Funding support — Up to ₹1 crore/acre for core infrastructure, plus up to 25% of project cost for external connectivity, aligned with PM GatiShakti.

Modified UDAN — ten-year, ₹28,840 crore regional connectivity plan

What — Cabinet approved the Regional Connectivity Scheme — Modified UDAN for 2026-27 to 2035-36 (10 years) with a total outlay of ₹28,840 crore — a six-fold jump in funding, entirely Centre-funded, to expand air connectivity to small/remote regions.
Key components — 100 new airports from unserved airstrips (₹12,159 crore); 200 modern helipads (~₹15 crore each) for hilly/remote/island districts; ₹10,043 crore Viability Gap Funding over 10 years for airlines on regional routes.
Track record since 2016 — Original UDAN (launched 2016) operationalised 663 routes connecting 95 airports/heliports/water aerodromes, flying 3.41 lakh flights and 162.47 lakh passengers.

Fiscal Health Index 2026 — Odisha tops for the 2nd year

What — NITI Aayog released the 2nd edition of the Fiscal Health Index (FHI) 2026, ranking states as achiever, front runner, performer or aspirational across 5 sub-indices — Quality of Expenditure, Revenue Mobilisation, Fiscal Prudence, Debt Index, Debt Sustainability.
Key results — Odisha, Goa, Jharkhand are 'achievers' — Odisha tops for the 2nd consecutive year; Karnataka and Telangana slipped from 'front runner' to 'performer'; Bihar improved from 'aspirational' to 'performer'; Punjab, Andhra Pradesh, West Bengal, Kerala rank worst.
Coverage expanded — First edition covered 18 major states; this edition adds 10 North-Eastern & Himalayan states, evaluated separately — Arunachal Pradesh topped that group.

MSP funding for cotton

What — Cabinet Committee on Economic Affairs (CCEA) approved ₹1,718.56 crore to the Cotton Corporation of India (CCI) to meet Minimum Support Price needs for the 2023-24 cotton season (medium staple ₹6,620/quintal, long staple ₹7,020/quintal).
Significance — Cotton sustains ~60 lakh farmers and 400-500 lakh people in allied trade/textiles nationally, including in Andhra Pradesh; India accounts for nearly 25% of global cotton output.

Other schemes, funds & infrastructure notes — March 2026
Item	Key fact
Small Hydro Power Development Scheme	₹2,584.60 crore (FY 2026-27 to 2030-31) to support ~1,500 MW of small hydro projects (1-25 MW), focused on hilly/North-Eastern states; expected to attract ~₹15,000 crore investment and generate ~51 lakh person-days of employment.
PM E-DRIVE revised	New deadlines/price caps for EV subsidies — two-wheelers eligible only if registered by 31 July 2026 (ex-factory price ≤₹1.5 lakh); three-wheelers cut-off extended to March 2028 (price ≤₹2.5 lakh); total outlay capped at ₹10,900 crore.
Mutual Credit Guarantee Scheme modified	MCGS for MSMEs modified — 5% upfront contribution now refundable, eligibility expanded to service-sector MSMEs, minimum project-cost requirement cut from 75% to 60% for machinery/equipment; 60% guarantee coverage up to ₹100 crore credit.
National Investment and Infrastructure Fund	NIIF raised $750 million for its 2nd Private Markets Fund; India holds a 49% stake, considered India's quasi sovereign wealth fund, chaired by the Union Finance Minister.
NMDC's record iron ore output	First Indian mining company to produce 50 million tonnes of iron ore in a single financial year (FY 2025-26), as India targets 300 million tonnes steelmaking capacity by 2030.
Joha Rice — first GI export to UK/Italy	Assam's GI-tagged (2017) aromatic Joha rice exported for the first time to the UK and Italy via APEDA, after earlier exports to Vietnam and West Asian countries.
Fiscal/governance tools	Government Bank Dashboard & Manual launched by the Controller General of Accounts for real-time monitoring of government banking; PRISM-SG Portal digitises approvals for Road-Over-Bridge steel-girder inspections (cuts timeline from ~12 months to 3-4 months).
India ranks 54th on Innovators Business Environment Index	StartupBlink's IBEI 2026 (125 countries) ranks the US 1st, Singapore 2nd; India 54th, ahead of China (85th); India ranks 10th in the Asia-Pacific region.
Digital Twin for VOC Port	V.O. Chidambaranar Port (Tamil Nadu) becomes India's first major port to deploy a Digital Twin — a real-time virtual replica using AI/IoT/LiDAR, expected to cut vessel turnaround time by up to 25%.
Purple potatoes in Punjab	Faridkot farmers cultivating anthocyanin-rich purple potatoes (originally from the Andes) since 2022; India's own variety Kufri Jamunia was launched by the Central Potato Research Institute in 2024.
Orange Economy initiatives	Information & Broadcasting Ministry launched 3 initiatives for India's creative/media economy — National AI Skilling Programme (15,000 participants, with Google/YouTube), MyWaves (user-generated content platform), and built-in satellite tuners for DD Free Dish TVs.
Food Security Index — India among 'most concerning'	IIED's food-security index (162 countries) scores India at 5.31, below the global average of 6.74, projected to fall further to 4.96 at 1.5°C warming and 4.52 at 2°C; Iceland topped at 9.26.
National Shipping Board & International Year of the Woman Farmer	Government held a high-level NSB (a 1959 statutory body under the Merchant Shipping Act, 1958) meeting on maritime capacity; UN declared 2026 the International Year of the Woman Farmer to close gender gaps in agrifood systems.

3. Trade, Investment & Economic Diplomacy

US Section 301 investigations into India

What — US launched 2 Section 301(b) investigations (US Trade Act, 1974) into India and other economies — one on structural manufacturing overcapacity (e.g. India's solar-module capacity is ~3x domestic demand), another covering 60 countries on forced-labour supply-chain safeguards.
Context — Follows a February 2026 US Supreme Court ruling against using the IEEPA to impose tariffs; a temporary 10% tariff on all countries' imports now applies under Section 122 for 150 days; India–US bilateral trade reached $131.84 billion in 2024-25.

Canadian PM's visit — $1.9 billion uranium deal, CEPA revived

What — Canadian PM Mark Carney made the first bilateral visit by a Canadian PM since 2018 (Trudeau), aiming to rebuild trust after the 2023 rupture over the killing of Khalistani separatist Hardeep Singh Nijjar.
Outcomes — 1.9 billion uranium supply deal (Canada's Cameco to supply 10,000 tonnes to Indian nuclear plants, 2027-2035 — India imports 70%+ of its uranium as domestic ore quality is poor); revived CEPA talks targeting bilateral trade growth from 8.66 billion to $50 billion by 2030.

India–Finland Strategic Partnership in Digitalisation and Sustainability

What — PM Modi and Finnish President Alexander Stubb elevated ties to a "Strategic Partnership in Digitalisation and Sustainability" — 3 pacts signed (migration & mobility, environment, statistics), joint working groups on AI/6G and clean energy/quantum computing.