Economy & Business Current Affairs - 2026-05-29

Background: The Reserve Bank of India (RBI) conducts bi-monthly monetary policy reviews to manage inflation, ensure financial stability, and support economic growth. These reviews involve decisions on key interest rates like the repo rate. Current Context: In its latest review on May 29, 2026, the RBI's Monetary Policy Committee (MPC) decided to maintain the repo rate at 6.5% for the seventh consecutive time, citing persistent global uncertainties and the need to bring inflation within the target band. The MPC also reiterated its commitment to a 'withdrawal of accommodation' stance. Impact: This decision aims to anchor inflation expectations while supporting nascent economic recovery. It provides stability for borrowers and investors, though some sectors might have hoped for a rate cut to stimulate credit growth. The move signals the RBI's cautious approach amidst evolving domestic and international economic landscapes.

Background: India has been actively promoting domestic manufacturing and reducing import dependence through various Production-Linked Incentive (PLI) schemes across sectors. These schemes offer incentives on incremental sales from products manufactured in India. Current Context: On May 28, 2026, the Union Cabinet approved a new PLI scheme worth ₹25,000 crore for advanced green technologies, including hydrogen fuel cells, carbon capture, and sustainable battery manufacturing. This initiative aims to position India as a global hub for eco-friendly industrial production. Impact: The scheme is expected to attract significant domestic and foreign investment, create thousands of jobs, and boost R&D in critical green sectors. It will enhance India's energy security, contribute to climate goals, and foster a competitive ecosystem for sustainable manufacturing, driving economic growth and technological advancement.