Current Affairs: 1–7 October 2026

The six-member Monetary Policy Committee held its 63rd meeting from 5 to 7 October 2026 under Governor Sanjay Malhotra. It voted unanimously to raise the policy repo rate by 25 basis points, from 5.25% to 5.50%. As a result, the Standing Deposit Facility (SDF) rate is now 5.25%, and the Marginal Standing Facility (MSF) rate and the Bank Rate are 5.75%. The Governor cited the renewed West Asia conflict, which pushed the Indian basket of crude oil to an average of US$116.1 a barrel in September, along with a deficient monsoon (13% below the Long Period Average) and early signs that inflation is becoming generalised.

The MPC changed its stance from neutral to "calibrated tightening" by a 4–2 vote. External members Dr Nagesh Kumar and Prof. Ram Singh voted to keep the stance neutral. The Governor said rate cuts were "off the table in the near term", so the next move can only be a hike or a pause. Between the August and October meetings, system liquidity ran at an average daily surplus of ₹5.9 lakh crore, and the RBI absorbed it through 55 variable rate reverse repo (VRRR) auctions and ₹1.0 lakh crore of OMO sales. The next MPC meeting is scheduled for 2 to 4 December 2026.

The 7 October Statement on Developmental and Regulatory Policies lets customers reach their financial information at any Financial Information Provider through the NBFC-Account Aggregator of their choice, so AAs become interoperable. SEBI-regulated depositories will be able to include bank deposit account details in their Consolidated Account Statement (CAS), so demat holders can see their demat holdings and bank deposits in one place. Both measures are to be in place by 31 December 2026.

The second measure in the 7 October statement is a Technical Consultative Committee for Financial Markets, a forum for structured engagement with market participants. It will cover policy and operational matters in the money, government securities and foreign exchange markets, together with their derivatives and market infrastructure. The RBI will notify its composition and terms of reference separately.

On 7 October the RBI issued the Reserve Bank of India (Commercial Banks – Credit Valuation Adjustment Framework) Directions, 2026, which revise the capital charge for CVA risk. Among the changes, eligible banks may now use a simpler approach. On the same day it issued amendments to the Standardised Approach for Counterparty Credit Risk (SA-CCR), covering items such as multiple margin agreements and banks that act as clearing members on SEBI-recognised exchanges. Both sets of rules take effect from 1 April 2027.

On 1 October the RBI issued final Amendment Directions that simplify approval when mutual funds, insurance companies and pension funds make further acquisitions of "major shareholding" in a banking company. The amendments apply to commercial banks, small finance banks, payments banks and local area banks, and took effect immediately. The draft had been released for comment on 14 July 2026.

The RBI announced on 7 October that Paytm Payments Bank Limited has been excluded from the Second Schedule to the Reserve Bank of India Act, 1934. The notification is dated 31 July 2026 and was published in the Gazette of India on 7 September 2026.

At NPS Diwas 2026 on 1 October, DFS Secretary Sanjay Lohiya presented PFRDA's Certificate of Appointment as Sponsor of a Pension Fund to Bank of Baroda MD and CEO Debadatta Chand. The appointment is under Section 27 of the PFRDA Act, 2013. The bank's subsidiary, BoB Pension Fund Management Company Ltd, is 80.10% owned by Bank of Baroda and 19.90% by Baroda BNP Paribas AMC. SBI was the first public sector bank to enter the business, in 2008.

The RBI's indicative calendar, released on 1 October, puts States' and UTs' market borrowing in Q3 FY27 at ₹3,60,820 crore. From this quarter the Benchmark Issuance Strategy (BIS) is extended to Assam, Goa, Haryana, Mizoram, Nagaland, Tripura and the UT of Jammu and Kashmir. That brings it to 24 States and 2 UTs, after nine States in the Q1 pilot and nine States plus Delhi added in Q2.

Gross GST collections for September 2026 were ₹2,03,521 crore, data released on 1 October showed. That is 14.7% more than a year earlier and the third month in a row above ₹2 lakh crore. GST on imports jumped 25.9% to ₹65,525 crore, while domestic revenue rose 10.1% to about ₹1.38 lakh crore. Net GST revenue after refunds rose 18.1% to ₹1,76,520 crore. Gross collections for April–September came to ₹12,46,278 crore, up 11.6%.

The final HSBC India Manufacturing PMI, released on 1 October, rose to 55.1 in September from 52.8 in August. That is the highest reading since February, though below the flash estimate of 55.7. New orders grew at their fastest pace in seven months, factory hiring returned to growth and business confidence reached a four-month high, but input cost inflation picked up.

The final HSBC India Services PMI for September, released on 6 October, rose to 55.2 from 54.1 in August, against a flash reading of 55.8. The Composite PMI rose to 55.9 from 54.3. Export orders grew at their slowest pace in nearly three years, and input cost inflation eased to a 10-month low.

The RBI raised its real GDP growth projection for 2026-27 by 40 bp to 7.1%, with Q2 at 7.2%, Q3 at 6.9% and Q4 at 6.8%, and 7.1% for Q1 of 2027-28. It projects CPI inflation for 2026-27 at 5.2%, with Q2 at 4.9%, Q3 at 6.0%, Q4 at 5.7% and Q1 of 2027-28 at 5.6%. Core inflation is projected at 4.4%. CPI inflation was 4.8% in August, up from 4.5% in July, and Q1 FY27 GDP growth was 7.8%.

India's foreign exchange reserves stood at US$747.557 billion on 25 September 2026, down US$18.343 billion in the week, according to the RBI's Weekly Statistical Supplement of 2 October. Foreign currency assets were US$615.4 bn and gold was US$108.7 bn. Reserves had reached a record US$785.7 bn on 4 September. In his 7 October statement the Governor said reserves cover about 11 months of imports.

On 6 October the Union Cabinet approved the Integrated Transport and Logistics Authority, a special purpose vehicle that will be the apex body for integrated transport and logistics planning. It will prepare a National Transport Master Plan with a horizon of 10 years or more, covering roads, railways, ports, aviation, inland waterways and urban mobility. It will also carry out technical appraisal of central infrastructure projects costing ₹500 crore or more. Minister Ashwini Vaishnaw announced the decision.

The Cabinet on 6 October also approved a government commitment of ₹10,000 crore to set up the SME Growth Fund, which will make direct equity investments in small and medium enterprises through an Alternative Investment Fund. Most of the money is earmarked for manufacturing-focused SMEs, and firms in industrial clusters in Tier-II and Tier-III cities will also be considered. The fund was announced in the Union Budget 2026-27 to fill a gap in growth-stage equity, since existing funds mostly back early-stage and micro enterprises.

On 3 October the Ministry of Education's Department of Higher Education announced five Centres of Excellence: Classical Assamese at Tezpur University, Bengali at Visva-Bharati, Marathi at Deccan College, Pune, Pali at the Central University of Odisha, and Prakrit at the Central University of Gujarat. They will work on research, digitisation, preservation and dissemination.

The RBI approved Anup Bagchi as MD and CEO of HDFC Bank for three years, through a communication dated 1 October 2026. His term begins on 27 October 2026 and runs to 26 October 2029. He succeeds Sashidhar Jagdishan and is the bank's first CEO from outside. Bagchi is currently MD and CEO of ICICI Prudential Life Insurance.

Kotak Mahindra Bank announced on 1 October that the RBI had approved Anup Kumar Saha as its MD and CEO for three years from 1 January 2027. He succeeds Ashok Vaswani. Saha, a whole-time director at the bank, joined in January 2026 after more than eight years at Bajaj Finance.

The RBI appointed Sudhakar Malli as Executive Director with effect from 1 October 2026, announcing it on 2 October. He was previously Chief General Manager-in-Charge of the Department of Supervision, and as ED he will look after the Department of Supervision (Supervisory Assessment).

On 5 October the Nobel Assembly at Karolinska Institutet awarded the 2026 Nobel Prize in Physiology or Medicine to Karl Deisseroth (US), Peter Hegemann (Germany) and Georg Nagel (Germany) "for discoveries concerning light-gated ion channels and optogenetics". Optogenetics uses light to switch individual nerve cells on or off in a living brain. The three share 12 million Swedish kronor.

On 6 October the Royal Swedish Academy of Sciences awarded the entire 2026 Physics prize to Belgian-American physicist Francis Halzen "for decisive contributions to the IceCube Neutrino Observatory and the discovery of high-energy neutrinos of astrophysical origin". IceCube uses about a cubic kilometre of Antarctic ice fitted with optical sensors.

On 7 October the Chemistry prize went jointly to Henri B. Kagan (France) and Kenso Soai (Japan) for work on non-linear effects and autocatalysis in asymmetric organic synthesis. Their work concerns chirality, the mirror-image forms of molecules, which matters for making drugs. Each receives half of the 12 million kronor prize.

On 6 October Adani Power and Druk Green Power Corporation (DGPC) of Bhutan signed a shareholders' agreement for the 770 MW Chamkharchhu-I hydropower project. Bhutan's Prime Minister Tshering Tobgay attended the signing. The project company will be owned 51% by DGPC and 49% by Adani Power and will run on a 30-year build-own-operate-transfer (BOOT) concession. Construction is expected to begin in the first half of 2027. It follows the 570 MW Wangchhu project agreed in September 2025.

On 6 October Defence Minister Rajnath Singh launched Fleet Support Ship-1, "Surya", at Hindustan Shipyard Limited (HSL), Visakhapatnam. It is the first of five 43,500-tonne ships that will refuel and resupply warships at sea. He also laid the keel of FSS-5, inaugurated the upgraded Slipway-4 and commissioned a 300-tonne Goliath crane, which together let HSL build ships of up to 45,000 DWT.

The India–UAE joint military exercise Mountain Guardian 2026 began on 5 October at the Foreign Training Node, Chaubatia (Uttarakhand), and runs until 18 October. It involves 92 personnel: 46 from a Bhairav Battalion of the Indian Army and 46 from the UAE Land Forces' Mountain Infantry Battalion. The training focuses on mountain warfare, including drone operations, surveillance grids and rock climbing.

The 20th Asian Games in Aichi-Nagoya, Japan, held from 19 September to 4 October 2026, ended with India fourth on 85 medals: 21 gold, 27 silver and 37 bronze. China topped the table with 341 medals (169 gold), ahead of Japan and South Korea. This is India's second-best haul after the record 106 medals at Hangzhou (held in 2023). Archery brought India the most golds (five).

On 2 October India's women beat defending champions China 1–0 in the final to win their first Asian Games gold since 1982. On 3 October the men beat Malaysia 5–1, with Harmanpreet Singh scoring twice, and became the first Indian men's team to defend the title. Both teams qualified directly for the Los Angeles 2028 Olympics. It was the first time India had won both hockey golds at the same Asian Games.

2 October 2026 marked Mahatma Gandhi's 157th birth anniversary, which the UN observes as the International Day of Non-Violence. It was also Lal Bahadur Shastri Jayanti; Shastri was born on 2 October 1904.

World Teachers' Day was observed on 5 October. In 2026 it marked 60 years of the 1966 ILO/UNESCO Recommendation concerning the Status of Teachers, with the global event at UNESCO headquarters in Paris. Other days in the week were the International Day of Older Persons (1 October) and World Habitat Day (first Monday of October, 5 October in 2026).