July 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 EPF Scheme, 2026 and 'EPFO 3.0' pension reform, the India-UK trade deal coming into force, new manufacturing schemes for mobile phones and semiconductors, and a clutch of global rankings and reports.
A silicon wafer, the base material of semiconductor chip manufacturing — the sector at the centre of July 2026's Semicon 2.0 (₹1,27,500 crore) Cabinet approval · Rob Bulmahn / Wikimedia Commons (CC BY 2.0)
July 2026 — Month at a Glance
The month's biggest economic story was the India-UK CETA coming into force — India's first comprehensive trade deal with a developed economy. Social-security architecture was overhauled with the EPF Scheme, 2026 and the 'EPFO 3.0' reform proposing a Universal Pension Scheme. The Union Cabinet approved big-ticket manufacturing pushes — a Mobile Phone Manufacturing Scheme, Semicon 2.0 and the BHAVYA Rasayan Scheme — while a run of global reports assessed India's investment climate, income classification and food security.
EPF Scheme, 2026 replaces the 1952 scheme
- What — The Ministry of Labour and Employment notified the EPF Scheme, 2026 under the Code on Social Security, 2020, replacing the EPF Scheme, 1952.
- Unchanged core — 12% contribution rate by both employer and employee; ₹15,000 monthly wage ceiling for mandatory coverage; interest rate notified annually (currently 8.25%); existing UANs/balances continue.
- What's new — Aadhaar-based digital records; broader withdrawal grounds — education, marriage, home purchase, medical treatment, permanent disability and unemployment.
'EPFO 3.0' proposes a Universal Pension Scheme
- What — EPFO 3.0 proposes a Universal Pension Scheme (UPS) built on a Target Retirement Sum (TRS) model, extending retirement security to self-employed, gig, platform and unorganised-sector workers currently outside the EPS, 1995.
- Digital features — Core-banking-solution integration; instant digital withdrawal of 50–75% of eligible balances via UPI/PF-linked ATM cards; auto-settlement claim limit raised from ₹1 lakh to ₹5 lakh.
- EPFO basics — Established under the EPF & Miscellaneous Provisions Act, 1952; administers EPF (1952), EPS (1995) and EDLI (1976).
2. India-UK CETA & Manufacturing Push
India-UK CETA comes into force
- What — The India-UK Comprehensive Economic and Trade Agreement (CETA) came into effect on 15 July 2026, a year after signing; the Double Contribution Convention (DCC) also became operational. It is India's first comprehensive trade deal with a developed country, spanning 30 chapters.
- Tariffs — India eliminated/phased tariffs on ~90% of products (89.5% of tariff lines, 89.4% of trade value); the UK eliminated tariffs on 99% of Indian exports immediately (96.8% of its tariff lines on day one).
- Notable firsts — First auto quota in any Indian FTA — British car tariffs cut from up to 110% to 30% in year one, 10% by year five (quota 20,000→37,000 vehicles); first FTA allowing self-declared origin by UK exporters; alcohol tariffs cut from 150% to 75% initially.
- Remaining gap — India did not secure an exemption from the UK's Carbon Border Adjustment Mechanism (CBAM), effective from 1 January 2027 — a concern for export-oriented industries.
Mobile Phone Manufacturing Scheme (MPMS)
- What — The Union Cabinet approved a new MPMS with a ₹62,500 crore outlay (FY 2026-27 to FY 2030-31), succeeding the PLI Scheme for Large Scale Electronics Manufacturing (ended 31 March 2026).
- PLI legacy — PLI attracted ₹20,600+ crore investment, generated ₹11.62 lakh crore production and ₹6.53 lakh crore exports, making India the world's 2nd-largest mobile phone manufacturer by volume.
- Incentives — 2.25–5% incentive on eligible sales; up to 1.5% extra for domestic component sourcing; 3% extra for Indian brands investing in design/R&D — targets ~₹39,00,000 crore cumulative production and 60,000 direct jobs.
Semicon 2.0 and the BHAVYA Rasayan Scheme
- Semicon 2.0 — Cabinet approved Semicon 2.0 with a ₹1,27,500 crore outlay, built on 6 pillars, to deepen India's semiconductor design and manufacturing ecosystem beyond Semicon 1.0.
- BHAVYA Rasayan Scheme — ₹3,030 crore scheme (FY 2026-27 to FY 2030-31) for 3 dedicated Chemical Parks, each ≥2,000 acres, with plug-and-play infrastructure; Centre grants up to ₹1,000 crore/park, matched by a ₹500 crore minimum State contribution.
- FDI relaxation — DPIIT allowed FDI in inventory-based e-commerce entities, but only for exports of domestically manufactured goods — domestic inventory-based retail sales stay off-limits.
3. Investment, PSUs & Rankings
Cabinet approves additional ₹30,000 crore in NIIF
- What — Union Cabinet approved an additional ₹30,000 crore investment in the National Investment and Infrastructure Fund (NIIF), doubling the government's total commitment to ₹60,000 crore; primarily supports NIIF Infrastructure Fund II (transport, energy, digital and urban infrastructure, electric mobility).
MECON gets Miniratna Category-I status
- What — The Ministry of Steel granted Miniratna Category-I status to MECON Limited (est. 1959, Ranchi) — an engineering/consultancy CPSE spanning mining, infrastructure, power and oil & gas — giving its Board greater financial and operational autonomy.
National Investment Policy for Urea, 2026 (NIPU-2026)
- What — CCEA approved NIPU-2026, replacing the NIP-2012, to promote fresh investment in gas-based urea plants. India has 33 operational urea units (installed capacity 269.42 LMT); domestic production (251.26 LMT, Apr–Jan 2025-26) still falls short of demand, requiring imports (89.30 LMT).
NITI Aayog's Investment Friendliness Index (IFI)
- What — NITI Aayog's Investment Friendliness Index assesses States/UTs on 84 indicators across 8 pillars — infrastructure, business climate, resources, policy, regulatory ease, institutions, financial health and environmental resilience.
- Result — States/UTs classified into four bands (Top Performers, Frontrunners, Emerging, Aspiring); Gujarat, Maharashtra, Tamil Nadu and Odisha ranked as overall top performers.
4. Markets & Digital Commerce
Electronic Gold Receipts (EGRs) and the Ahimsa Index
- EGRs — NSE launched Electronic Gold Receipts — demat-held, exchange-traded securities representing physical gold in SEBI-regulated vaults, available in 999/995 purity across six denominations (10 mg to 1 kg); no GST on trading, but 3% GST applies on physical delivery.
- Ahimsa Index — NSE launched the Nifty 500 Ahimsa Index, tracking companies free of animal cruelty (green-band only, per the Ahimsagain Foundation's AIM framework) — following BSE's Saatvik 100 index (June 2026).
E-Commerce Council of India and Indiahandmade
- ECCI — IAMAI launched the E-Commerce Council of India (ECCI), a first-of-its-kind platform to unify India's $120 billion digital commerce ecosystem through structured policy dialogue.
- Indiahandmade — A digital marketplace (launched 2023 by Digital India Corporation, Ministry of Textiles) for India's 64.66 lakh handloom/handicraft artisans — women are 71% of weavers and 64% of total artisans.
Index of Core Industries: new base year and coverage
- What — DPIIT's Office of Economic Adviser updated the Index of Core Industries (ICI) — base year shifted from 2011-12 to 2022-23; sectors increased from 8 to 9 with iron ore added; coal now measures only raw coal (avoiding double-counting).
Codex Alimentarius Commission — India's role, July 2026| Fact | Detail |
|---|
| What is Codex | International food standards, guidelines and codes of practice ("food code") |
| July 2026 outcome | CAC adopted 7 standards/guidelines developed under India's chair/co-chairmanship |
| New role | India elected Co-Chair of the Electronic Working Group on New Food Sources & Production Systems |
5. Global Rankings, Agriculture & Maritime Trade
World Bank Country Income Classification: India stays lower-middle-income
- Method — Updated annually (1 July) using the previous year's GNI per capita (World Bank Atlas Method); FY2027 classification covers 218 economies in 4 bands: Low (≤1,175), Lower-middle (1,176–4,635), Upper-middle (4,636–14,375), High (>14,375).
- India — Remains lower-middle-income despite fast GDP growth — the classification uses per-capita GNI, which stays modest given India's large population and inter-state disparities. Six economies moved up (incl. Togo, Vietnam, Sri Lanka); none moved down.
World Intangible Investment Report 2026
- What — WIPO and Luiss Business School's 3rd edition reaffirms India's rise as an innovation powerhouse; covers 29 economies (57% of world GDP). Global intangible investment crossed $10 trillion for the first time in 2025, growing 3x faster than tangible investment since 2008.
State of Food Security and Nutrition in the World, 2026
- Publisher — Joint annual report by FAO, IFAD, UNICEF, WFP and WHO; 2026 theme: *Understanding and Addressing the High Cost of a Healthy Diet*.
- Global findings — Global hunger declined for a 3rd consecutive year — 7.8% of the population (~645 million) faced hunger in 2025 (down from 8.6% in 2022); Africa (309 million hungry) now surpasses Asia (292 million) in absolute numbers.
Mission Golden Spice and Direct Seeded Rice
- Mission Golden Spice — MDoNER's ₹175+ crore, 5-year project to build a farm-to-market ecosystem for Meghalaya's GI-tagged Lakadong turmeric (high curcumin) — targets 7,000 hectares, 3,000+ women-led jobs and a ₹100 crore turmeric economy by FY 2028-29.
- Direct Seeded Rice — Chhattisgarh advised farmers to prioritise DSR ("broadcasting"— pre-germinated seeds drilled directly, no nursery/transplanting) over transplanting amid El Niño-linked rainfall uncertainty — it also cuts methane emissions from flooded paddy fields.
India: world's 2nd-largest seafarer supplier, and seafarer safety tracking
- Ranking — Per the BIMCO-ICS Seafarer Workforce Report 2026, India supplies 3,11,936 seafarers (12.16% of the global workforce) — 2nd after the Philippines, ahead of China, Russia and Indonesia; up from 5th place (5.2%) in 2015. The Government's Mission 20% targets a 20% global share.
- Safety tracker — Following seafarer deaths in the US-Iran conflict, the Centre launched the eNavik Portal (24×7 marine casualty reporting) and an operational dashboard to track every Indian on any vessel in the Persian Gulf, Strait of Hormuz and Gulf of Oman.