Daily UPSC current affairs for 13 Oct 2026: CPI inflation 5.54%, Karnataka HC SC/ST quota verdict, new Governors, IMF 7% forecast, Garba and UNESCO ICH.

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Table of Contents

1. How to Keep an Economy Stable Using Policy Tools (GS Paper 3: Economy)
2. Rising Food Prices Push Retail Inflation to 5.54% in September (GS Paper 3: Economy)
3. Citing 50% Cap, Karnataka HC Strikes Down SC/ST Quota Hike (GS Paper 2: Polity)
4. Six States Get New Governors; Arlekar Goes to Tamil Nadu (GS Paper 2: Polity)
5. IMF Raises India's FY27 Growth Forecast to 7% (GS Paper 3: Economy)
6. Garba in News and UNESCO's Intangible Cultural Heritage (GS Paper 1: Art & Culture)

1. How to Keep an Economy Stable Using Policy Tools

Syllabus: GS Paper 3 – Indian Economy, mobilisation of resources, growth and inflation.

A stable economy grows steadily without runaway prices, mass unemployment or financial crises. Governments and central banks use two main levers, fiscal policy and monetary policy, backed by macroprudential and supply-side tools. The topic is in focus because the RBI raised the repo rate on 7 October 2026 to fight rising inflation.

Why economies need stabilisation

Economies move in business cycles of boom and slowdown. In a boom, demand outruns supply and prices rise. In a slowdown, demand falls, firms cut output and jobs are lost. Stabilisation policy leans against the cycle: it cools demand in a boom and supports it in a slump. This approach is called counter-cyclical policy.

Tool 1: Fiscal policy (Government)

Fiscal policy is the government's use of spending, taxation and borrowing to influence demand, output and jobs. In India it is delivered mainly through the annual Union Budget.

• Expansionary fiscal policy: higher spending (e.g., capital expenditure on roads, railways) or tax cuts during a slowdown.
• Contractionary fiscal policy: lower spending or higher taxes when the economy overheats.
• Key instruments: public expenditure, taxation (direct and GST), public debt, subsidies and transfers.
• Automatic stabilisers: progressive income tax and welfare schemes that adjust on their own as incomes change.
• Fiscal rules: the FRBM Act, 2003 sets targets for the fiscal deficit to keep borrowing sustainable.

Tool 2: Monetary policy (RBI)

Monetary policy is the RBI's control over interest rates, money supply and credit. Under the amended RBI Act, 1934, a six-member Monetary Policy Committee (MPC) sets the repo rate to keep CPI inflation at 4%, within a band of 2% to 6%.

Qualitative tools such as margin requirements, moral suasion and selective credit controls direct credit to or away from specific sectors.

Tool 3: Macroprudential and supply-side measures

• Macroprudential tools: higher risk weights on unsecured loans, countercyclical capital buffers and loan-to-value limits protect the banking system from bubbles.
• Supply-side tools: buffer stocks, open market sale of food grains, export curbs and import duty cuts ease food inflation, which interest rates cannot fix directly.
• Exchange rate management: RBI forex intervention smooths sharp swings in the rupee.

Fiscal vs monetary policy at a glance

Current context: RBI shifts to tightening

On 7 October 2026, the MPC unanimously raised the repo rate by 25 basis points to 5.50%, its first hike since February 2023. The SDF moved to 5.25% and the MSF to 5.75%. The stance changed from neutral to calibrated tightening, citing inflation, high crude prices, West Asia risks and a weaker rupee.

Challenges in policy coordination

• Fiscal dominance: heavy government borrowing can push up interest rates and blunt the RBI's actions.
• Supply shocks: onion or vegetable price spikes come from weather, not excess demand, so rate hikes help little.
• Transmission lags: bank lending rates take months to follow the repo rate.
• Growth–inflation trade-off: tightening may slow a 7% growth economy.

Way forward

India needs coordination between the Finance Ministry and the RBI, credible fiscal consolidation, stronger food supply chains and better storage. A clear policy communication anchors expectations so that a small hike does more work.

Key Facts – Policy Tools

• Inflation target: 4% CPI, band 2–6% (flexible inflation targeting since 2016).
• MPC: 6 members – Governor (chair), Deputy Governor, one RBI officer, three external members.
• Repo rate after 7 Oct 2026: 5.50%; SDF 5.25%; MSF and Bank Rate 5.75%.
• FRBM Act enacted in 2003 for fiscal discipline.
• Counter-cyclical policy = act against the business cycle.

Mains question: "Monetary policy alone cannot tame supply-driven inflation in India." Discuss the role of fiscal and supply-side measures. (250 words)

2. Rising Food Prices Push Retail Inflation to 5.54% in September 2026

Syllabus: GS Paper 3 – Inflation, food security, monetary policy.

Why in news: Data released by the Ministry of Statistics and Programme Implementation (MoSPI) on 12 October 2026 showed CPI-based retail inflation rising to 5.54% in September from 4.83% in August. This is the highest reading in the new CPI series (base year 2024), driven mainly by food prices, especially onions.

Key numbers

Rural food inflation (8.06%) was higher than urban food inflation (7.18%). Potato, tomato, lady's finger and coconut were cheaper than a year ago.

Why are prices rising?

• Vegetable supply shock: onion prices more than doubled year-on-year due to supply disruptions.
• Fading base effect: inflation was unusually low in late 2025, so year-on-year comparisons now look higher.
• External pressures: high crude oil prices linked to the West Asia conflict and a weaker rupee raise import costs.
• Festive demand: the Navratri–Diwali season adds demand pressure.

Policy response

The print came days after the RBI raised the repo rate to 5.50% and adopted a calibrated tightening stance. Headline inflation is still inside the 2–6% tolerance band but is moving toward its upper end. Supply-side steps such as releasing buffer stocks of onions are needed alongside rate action.

Static concepts for Prelims

• CPI (Consumer Price Index): measures change in retail prices of a basket of goods and services; compiled by the National Statistics Office (NSO) under MoSPI.
• New CPI series: base year revised to 2024, with the new series released in 2026.
• CFPI (Consumer Food Price Index): the food sub-index of CPI.
• Headline vs core inflation: headline includes food and fuel; core excludes these volatile items.
• WPI: wholesale prices, released by the Office of the Economic Adviser, Ministry of Commerce and Industry.
• CPI-IW: used for Dearness Allowance, released by the Labour Bureau.

Key Facts – Retail Inflation

• September 2026 CPI inflation: 5.54% (August: 4.83%).
• Food inflation: 7.74%; onion inflation: 108.09%.
• Highest reading under the CPI series with base year 2024.
• Released by NSO, MoSPI on 12 October 2026; next release (October data) due 12 November 2026.
• RBI target: 4% ± 2%.

Mains question: Examine why food inflation in India remains volatile and suggest structural measures to stabilise vegetable prices. (150 words)

3. Citing 50% Cap, Karnataka HC Strikes Down Law Hiking SC/ST Quota

Syllabus: GS Paper 2 – Polity, reservation, judiciary, welfare of vulnerable sections.

Why in news: On 12 October 2026, the Karnataka High Court struck down the 2022 state law that raised Scheduled Caste (SC) and Scheduled Tribe (ST) reservation, holding that it breached the 50% ceiling on reservations. A division bench of Chief Justice Vibhu Bakhru and Justice K.S. Hemalekha delivered the verdict on a PIL filed by Mahendra Kumar Mitra.

What did the 2022 law do?

The Karnataka Scheduled Castes and Scheduled Tribes (Reservation of Seats in Educational Institutions and of Appointments or Posts in the Services under the State) Act, 2022 was passed by the Basavaraj Bommai government. It first came as an ordinance in October 2022, and the Act got the Governor's assent on 11 January 2023.

What did the High Court rule?

• It struck down Sections 3 and 4 of the Act, to the extent they pushed total reservation beyond 50%.
• It held the 50% ceiling from Indra Sawhney (1992) to be constitutionally binding.
• It rejected the argument that population share alone justifies crossing the ceiling; "extraordinary circumstances" must be shown.
• Earlier, in November 2025, the court had restricted fresh recruitment under the enhanced quota and made appointments subject to its final verdict.

Former CM Bommai has urged the state to appeal in the Supreme Court, citing states like Tamil Nadu where reservation exceeds 50%.

Constitutional and legal background

• Article 15(4): special provisions for SCs, STs and backward classes in education.
• Article 16(4): reservation in public employment for backward classes not adequately represented.
• Article 16(4A): reservation in promotion for SCs/STs (77th Amendment, 1995).
• Article 335: claims of SCs/STs balanced with efficiency of administration.
• Indra Sawhney v. Union of India (1992): nine-judge bench capped total reservation at 50% except in extraordinary situations; introduced the creamy layer for OBCs.
• Janhit Abhiyan v. Union of India (2022): upheld 10% EWS quota (103rd Amendment), holding the 50% cap applies to backward-class quotas, not EWS.
• Jaishri Laxmanrao Patil (2021): Supreme Court struck down the Maratha quota for crossing 50%.

States that crossed the 50% cap

• Tamil Nadu (69%): protected by its 1993 Act placed in the Ninth Schedule through the 76th Amendment, 1994.
• Bihar (65%): the 2023 hike was struck down by the Patna High Court in 2024.
• Note: the I.R. Coelho (2007) case held that Ninth Schedule laws after 24 April 1973 can still be reviewed for violating the basic structure.

Significance

The verdict reaffirms judicial insistence on the 50% ceiling and affects recruitment and admissions in Karnataka. It also revives the debate on whether caste-census data should allow states to go beyond 50%, and whether the cap needs fresh review by a larger bench.

Key Facts – Karnataka Quota Verdict

• Date: 12 October 2026; Bench: CJ Vibhu Bakhru and Justice K.S. Hemalekha.
• Law struck down: Karnataka SC/ST Reservation Act, 2022 (Sections 3 and 4).
• Hike: SC 15→17%, ST 3→7%; total 50→56%.
• Basis: 50% ceiling under Indra Sawhney (1992).
• EWS quota (10%) upheld in 2022 – outside the 50% cap.

Mains question: "The 50% ceiling on reservation balances equality of opportunity with social justice." Critically examine in light of recent judicial decisions. (250 words)

4. Six States Get New Governors; Arlekar Goes to Tamil Nadu

Syllabus: GS Paper 2 – Executive, Centre–State relations, constitutional posts.

Why in news: On 12 October 2026, President Droupadi Murmu appointed Governors for six states through a Rashtrapati Bhavan communiqué. Rajendra Vishwanath Arlekar, who had been holding additional charge of Tamil Nadu since 12 March 2026, now becomes its full-time Governor.

The six appointments

Two serving Governors (Arlekar and Mathur) were transferred, and four new faces were appointed.

Background: Arlekar's journey

Arlekar hails from Goa, where he served as MLA, Forest Minister and Assembly Speaker. He was earlier Governor of Himachal Pradesh and then Bihar, and took charge as Governor of Kerala on 2 January 2025. In March 2026, R.N. Ravi was moved from Tamil Nadu to West Bengal, and Arlekar was given additional charge of Tamil Nadu.

Constitutional provisions on the Governor

Issues in news: Governor–state friction

• Delay in assent to Bills: In State of Tamil Nadu v. Governor of Tamil Nadu (April 2025), the Supreme Court held that Governors cannot sit on Bills indefinitely and set timelines. A later Presidential Reference (2025) saw the Court decline to impose fixed timelines while stressing that indefinite delay is not allowed.
• Removal at pleasure: B.P. Singhal v. Union of India (2010) held that a Governor cannot be removed arbitrarily, only for valid reasons.
• Committees: Sarkaria Commission (1988) and Punchhi Commission (2010) recommended that Governors be detached from active politics and appointed after consulting the Chief Minister.

Key Facts – Governor Appointments

• Date: 12 October 2026; appointed by President Droupadi Murmu.
• Tamil Nadu: R.V. Arlekar (full-time); Kerala: Om Prakash Mathur.
• Karnataka: Sudha Yadav; Odisha: Braj Mohan Ram; Uttarakhand: Dhal Singh Bisen; Sikkim: Dushyant Gautam.
• Art. 155 – appointment; Art. 156 – pleasure of President; Art. 157 – minimum age 35.
• 7th Amendment (1956) allows one Governor for two or more states.

Mains question: Discuss the role of the Governor as a link between the Union and the States. Suggest reforms to reduce friction with elected state governments. (250 words)

5. IMF Raises India's FY27 Growth Forecast to 7%

Syllabus: GS Paper 3 – Growth and development; GS Paper 2 – International institutions.

Why in news: In its October 2026 World Economic Outlook (WEO), released around the IMF–World Bank Annual Meetings in Bangkok, the IMF raised India's GDP growth forecast for FY27 (2026-27) to 7%, up from 6.4% in its July 2026 update. It also lifted the FY28 forecast to 7% from 6.7%.

Forecast revisions for India

The October WEO is titled "Resilience Under Strain, Urgent Choices".

Why did the IMF upgrade India?

• Resilient domestic demand: strong private consumption.
• Robust services activity: IT, finance and other services continue to drive growth.
• Stronger-than-expected momentum in the June 2026 quarter.
• Favourable demographics and structural reforms support medium-term growth.

Risks flagged

• High crude oil prices due to the Middle East / West Asia conflict, which hurt energy importers like India.
• Rising domestic inflation, which has prompted RBI tightening.
• A fragile and uneven global recovery.

Other forecasts for comparison

The RBI and the World Bank have both projected growth of about 7.1% for 2026-27. The Asian Development Bank and the OECD have also turned more optimistic. India remains the fastest-growing major economy.

About the IMF and the WEO

• IMF: set up at the Bretton Woods Conference (1944); headquarters in Washington, D.C.; 191 member countries.
• Functions: global monetary cooperation, exchange-rate stability, balance-of-payments support and surveillance (Article IV consultations).
• Special Drawing Rights (SDR): IMF's reserve asset, valued on a basket of five currencies (US dollar, euro, Chinese renminbi, Japanese yen, British pound).
• World Economic Outlook: published twice a year (April and October), with updates in January and July.
• Other IMF reports: Global Financial Stability Report and Fiscal Monitor.

Key Facts – IMF Forecast

• India FY27 growth: 7% (raised from 6.4%); FY28: 7% (raised from 6.7%).
• Report: World Economic Outlook, October 2026, "Resilience Under Strain, Urgent Choices".
• Drivers: domestic demand, services, demographics, reforms.
• RBI's FY27 projection: about 7.1%.
• WEO is published twice a year (April and October).

Mains question: India is projected to grow at 7% amid a global slowdown. Analyse the drivers of this resilience and the risks to sustaining it. (150 words)

6. Why Is Garba in News? UNESCO's Intangible Cultural Heritage Explained

Syllabus: GS Paper 1 – Indian culture, performing arts, festivals; GS Paper 2 – International organisations.

Why in news: Sharad Navratri 2026 is being celebrated from 11 to 19 October, with Dussehra on 20 October. Garba events are being held across Gujarat, other Indian cities and the global diaspora. This is the first Navratri since India's Deepavali joined UNESCO's list in December 2025, bringing renewed attention to India's living heritage. Garba itself has been on UNESCO's Representative List since 2023.

What is Garba?

• A ritualistic and devotional folk dance of Gujarat, performed during the nine nights of Navratri in honour of the goddess Amba (Shakti, the feminine divine energy).
• The word comes from garbha (womb) and the garbo, an earthen pot with a lamp inside, around which dancers move in circles. The lamp symbolises life.
• Dancers move in concentric circles, clapping in rhythm to songs and the dhol.
• UNESCO highlighted Garba as a unifying force that promotes social and gender inclusivity, cutting across caste, class and religion.
• Garba vs Dandiya Raas: Garba is performed with hand claps; Dandiya Raas uses decorated sticks and is linked to Krishna's Raas Leela.

Garba's UNESCO inscription

• Inscribed on the Representative List of the Intangible Cultural Heritage of Humanity on 6 December 2023.
• Decided at the 18th session of the Intergovernmental Committee in Kasane, Botswana.
• It became India's 15th element on the list.

What is Intangible Cultural Heritage (ICH)?

ICH means the living practices, expressions, knowledge and skills that communities pass from generation to generation and recognise as part of their identity. Unlike monuments (tangible heritage, covered by the 1972 World Heritage Convention), ICH is "living" and keeps evolving.

The 2003 UNESCO Convention for the Safeguarding of the Intangible Cultural Heritage was adopted on 17 October 2003 in Paris and came into force in 2006. India ratified it in 2005. In India, the Sangeet Natak Akademi under the Ministry of Culture is the nodal agency for ICH nominations.

Five domains of ICH:

1. Oral traditions and expressions, including language
2. Performing arts
3. Social practices, rituals and festive events
4. Knowledge and practices concerning nature and the universe
5. Traditional craftsmanship

Three UNESCO ICH lists:

1. Representative List of the Intangible Cultural Heritage of Humanity – all of India's elements are here.
2. List of Intangible Cultural Heritage in Need of Urgent Safeguarding – India has no element.
3. Register of Good Safeguarding Practices – India has no entry.

The 20th session of the Intergovernmental Committee was held at the Red Fort, New Delhi, in December 2025, the first time India hosted it.

India's 16 elements on UNESCO's ICH list

Significance of ICH recognition

• Raises global visibility and boosts cultural tourism and soft power.
• Obliges the state to safeguard the tradition through documentation, education and community support.
• Supports artisans, musicians and performers whose livelihoods depend on these traditions.
• Risk: commercialisation can dilute ritual roots, as seen in ticketed mega-Garba events.

Key Facts – Garba and ICH

• Garba inscribed: 6 December 2023, Kasane (Botswana); India's 15th ICH element.
• Latest Indian element: Deepavali (December 2025, New Delhi) – 16th.
• 2003 Convention; India ratified in 2005; nodal body: Sangeet Natak Akademi.
• First Indian inscriptions: 2008 (Koodiyattam, Vedic chanting, Ramlila).
• India has no element on the Urgent Safeguarding List.

Mains question: "Intangible heritage is living heritage." Explain with Indian examples how UNESCO recognition can both protect and endanger such traditions. (150 words)