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Why in news?

India’s pre-owned vehicle market is booming, with used cars expected to outsell new ones at a ratio of 1.7:1 by 2030. Yet, complex and inconsistent state-level rules often force buyers and sellers to depend on costly intermediaries for ownership transfer.

A new report — the Ease of Vehicle Ownership Index (EVOI) — released by Minister of State for Road Transport and Highways recently, reveals stark disparities across states in how easily vehicles can be bought, sold, or transferred.

What’s in Today’s Article?

• What the EVOI Report Says?
• How States Were Evaluated?
• The Core Problem: Hidden Costs
• Market Size and Trends
• Proposed Solutions

What the EVOI Report Says?

• Prepared by IndiaTech.org (startup industry body) in partnership with Consumer VOICE.
• Covers 15 states, accounting for over 85% of India’s organised used-car market.
• Rankings (out of 10):
  • Andhra Pradesh: 5.91 (highest)
  • Kerala: 5.74
  • Delhi & Tamil Nadu: 4.58 (tied)
  • Karnataka, Gujarat, Madhya Pradesh, Maharashtra, Telangana, Punjab, Rajasthan, Haryana follow
  • West Bengal: 2.56, Bihar: 2.51, Uttar Pradesh: 2.47 (lowest)
• Key Finding: No state crossed a score of 6 — even top performers lack a fully functional ecosystem. Only 2 states scored above 5.5; 8 states scored between 3.8–4.3, pointing to widespread structural issues.

How States Were Evaluated?

• The index assessed states on six metrics:
  • Clarity and consistency of ownership transfer rules
  • Functional availability and reliability of online systems
  • Speed, predictability, and procedural burden
  • Fee clarity, application tracking, and grievance mechanism
  • Consumer protection, dealer support, and trade infrastructure
  • Official fees versus actual all-in market cost of transfer

The Core Problem: Hidden Costs

• Cost is the weakest pillar — 12 of 15 states scored below 3.5 on this metric. Manual verification and informal payments inflate real transfer costs to nearly 10 times the statutory fee.
• Examples: In Bihar, a single transfer can cost ₹13,000–₹14,000 above the official VAHAN fee. At border RTOs in Tamil Nadu (Hosur, Krishnagiri), an ₹800 official fee can balloon to ₹7,000–₹8,000.
• Delays and Procedural Burden - RC (Registration Certificate) transfer times vary drastically:
  • Andhra Pradesh: 7–10 days (uses biometric authentication for buyer, seller, and lender)
  • Uttar Pradesh: over 30 days
• In 13 of 15 states, applicants must file online and still submit physical copies to the RTO — defeating the purpose of digitisation.
• Uneven Road Tax: Another Layer of Complexity
  • Road tax on a ₹6 lakh petrol car varies from 3% in Uttar Pradesh to 14% in Karnataka — a difference of over ₹66,000 on the same vehicle.
  • Only Andhra Pradesh and Telangana have a functioning refund mechanism for vehicles leaving the state.

Market Size and Trends

• India’s pre-owned vehicle market was valued at $36.4 billion in 2024-25, projected to reach $73.5 billion by 2030.
• The used-to-new vehicle sale ratio is expected to rise from 1.3:1 to 1.7:1 by 2030 — still below the 2.5:1 to 3:1 ratio seen in mature markets like the US and Europe.
• 60–65% of used-car buyers are first-time car owners, highlighting the segment’s role as a gateway to mobility for emerging middle-income households.
• Average used-car price rose from ₹4.49 lakh (2021) to ₹5.47 lakh (2025); average new car price is around ₹11.5 lakh (2024).

Proposed Solutions

• Fix a stepwise timeline for vehicle transfers through an amendment to the Motor Vehicles Act.
• Accept DigiLocker and mParivahan documents as primary evidence at every RTO, ending dual online-and-physical submission.
• Enable real-time integration between banks and VAHAN, so hypothecation is automatically removed once a loan is closed.
• Allow authorised dealers to clear pending challans during transfer without requiring the owner’s OTP.

Conclusion

The EVOI exposes a fragmented, inconsistent used-vehicle transfer ecosystem across India, where state-level governance gaps, hidden costs, and procedural delays undermine a rapidly growing market.

As India’s pre-owned vehicle sector scales toward global benchmarks, harmonising rules, digitising processes fully, and ensuring fee transparency will be essential to make vehicle ownership genuinely accessible for India’s expanding middle class.

Why in news?

November 8, 2026 marked ten years since PM Modi’s dramatic televised announcement demonetising ₹500 and ₹1,000 notes, aimed at curbing black money, counterfeit currency, and pushing India toward a cashless economy.

A decade later, RBI data reveals a striking paradox: despite a massive digital payments boom, currency held by the public has more than doubled since demonetisation — raising questions about whether the note ban achieved its core objective.

What’s in Today’s Article?

• The Big Announcement and Immediate Impact
• The Long-Term Currency Trend
• Currency-to-GDP Ratio: A Mixed Signal
• Cash vs Digital: Coexistence, Not Replacement

The Big Announcement and Immediate Impact

• On November 8, 2016, at 8 PM, PM Modi declared existing ₹500 and ₹1,000 notes invalid from midnight — denominations that made up ~86% of currency in circulation.
• The sudden cash crunch disrupted shops, businesses, and households nationwide; people queued for hours at banks and ATMs.
• GDP growth declined by nearly 1.5 percentage points; many small businesses shut down due to liquidity shortages.

The Long-Term Currency Trend

• Currency with the public stood at ₹17.97 lakh crore (November 4, 2016), crashed to ₹7.8 lakh crore by January 2017, but has since surged to ₹42.55 lakh crore (as of October 15, 2026) — a 137% increase over pre-demonetisation levels.
• Currency with the public = Currency in Circulation (CIC) minus cash held by banks.
• In calendar year 2026 alone (till October 16), cash with the public rose by ₹5.26 lakh crore (14.1%).
• A sharp spike occurred in 2020-21, driven by pandemic-induced cash hoarding for groceries and medical expenses during the Covid-19 lockdown.

Currency-to-GDP Ratio: A Mixed Signal

• The CIC-to-GDP ratio rose from 8.7% (2016-17) to 14.4% (2020-21), before settling at 12.1% in FY26 — nearly identical to March 2016’s 12.1%.
• Global Comparison: Japan (16%+), China (10.2%), US (7.3%) — India’s ratio is higher than the US and China but lower than Japan.
• A higher ratio indicates greater cash dependence; a lower ratio typically reflects stronger digitalisation and better monetary policy transmission.
• Importantly, a high ratio doesn’t necessarily signal lower economic sophistication.

Cash vs Digital: Coexistence, Not Replacement

• Despite RBI and government efforts toward a “less-cash society”, cash usage has not declined — it has grown alongside digital payments.
• Total digital payments (FY2025-26): ₹3,251.04 lakh crore (covering RTGS, retail transfers, cards, and prepaid instruments).
• Card and wallet transactions (FY2025-26): ~151,611 lakh transactions worth ₹30.31 lakh crore.
  • Credit cards: ₹23.62 lakh crore (60,238 lakh transactions) — dominant by value.
  • Debit cards: ₹4.45 lakh crore (12,802 lakh transactions).
  • Wallets: ₹2.23 lakh crore, but highest transaction volume (78,571 lakh) — used for frequent, low-value payments.
• Comparison with FY2015-16: just 1,003.87 crore card transactions worth ₹29.39 lakh crore (debit cards dominant then).
• By value share in FY26: Credit cards (78%), Debit cards (14.7%), Wallets (7.4%).
• By volume share: Wallets (51.8%), Credit cards (39.7%), Debit cards (8.4%).

Conclusion

A decade on, demonetisation’s cashless dream remains unrealised — cash and digital payments now coexist rather than compete.

India’s economy has formalised and digitised significantly, yet physical currency continues circulating robustly, proving that convenience, trust, and habit still make cash resilient in a rapidly digitalising nation.

Why in the News?

• COP31 in Antalya, Turkey, has renewed debate over the concept of 1.5°C climate overshoot and the need for developed countries to fulfil their emissions-reduction and climate-finance commitments.

What’s in Today’s Article?

• Climate Overshoot (Concept, Climate Obligations, Scientific & Economic Challenges, Climate Inequity, Way Forward, etc.)

Understanding the 1.5°C Climate Overshoot

• The 2015 Paris Agreement aims to limit global warming to well below 2°C above pre-industrial levels while pursuing efforts to restrict it to 1.5°C.
• Climate overshoot refers to a situation in which global temperatures temporarily exceed the 1.5°C threshold before potentially returning to that level by the end of the century through large-scale carbon dioxide removal.
• The concept has gained prominence in climate negotiations. However, it raises concerns about whether future carbon-removal technologies and mitigation measures can realistically reverse the effects of excessive emissions.
• The central argument is that the possibility of returning to 1.5°C should not become an excuse for delaying immediate emissions reductions.

Developed Countries and Unfulfilled Climate Obligations

• Developed countries have historically contributed disproportionately to global greenhouse gas emissions. However, their domestic climate actions and financial commitments remain inadequate.
• Major Concerns include the following:
  • Continued fossil-fuel dependence: Fossil fuels accounted for approximately 83% of primary energy consumption in the United States and 73% in the European Union in 2025.
  • Expansion of fossil-fuel projects: Countries including the US, Norway, the UK, Germany, the Netherlands and Australia have continued approving oil and gas exploration or extraction projects.
  • Inadequate climate finance: Although developed countries reported mobilising approximately $137 billion in climate finance in 2024, its estimated actual value was only $33–45 billion. Around 65% of public finance was provided as loans.
  • Declining adaptation finance: Adaptation finance fell to $26 billion in 2023, against an estimated annual requirement of $310-365 billion by 2035.
• These developments highlight the gap between international climate commitments and their actual implementation.

Scientific and Economic Challenges of Climate Overshoot

• The United Nations Environment Programme (UNEP), in its report Limiting Overshoot: Navigating Exceedance of 1.5 Degrees Celsius and Pathways towards Return, examined the scale of carbon removal required to reverse temperature increases.
• The report highlighted that reversing just 0.1°C of warming would require permanently removing approximately 220 billion tonnes of CO₂ from the atmosphere.
• Current carbon-removal capacity remains inadequate:
  • Natural systems, particularly forests and soils, remove approximately 2.2 billion tonnes of CO₂ annually.
  • Direct air capture removes barely 2 million tonnes annually.
  • Scaling up direct air capture could cost approximately $600 per tonne of CO₂ removed.
• Moreover, removing carbon dioxide from the atmosphere does not necessarily reverse all the climatic consequences caused by its original emission.
• This makes reliance on future carbon-removal technologies scientifically uncertain and economically challenging.

Climate Inequity and the Global South

• A major concern surrounding climate overshoot is the unequal distribution of its costs and responsibilities.
• Large-scale carbon removal requires land, forests and other natural resources. However, much of the land identified for carbon-removal projects is located in developing countries.
• Experts highlight that national climate pledges already rely on nearly 1.2 billion hectares of land for CO₂ removal, much of it in the Global South.
• This creates several concerns:
  • Land-use conflicts: Land required for carbon-removal projects may compete with agriculture, food production and local livelihoods.
  • Unequal responsibilities: Developed countries may outsource their emissions-reduction obligations through carbon credits and projects in developing countries.
  • Development constraints: Carbon-removal projects may restrict the availability of land and natural resources needed for industrialisation.
  • Biodiversity and indigenous rights: Large-scale land-use changes can affect ecosystems and communities dependent on forests and natural resources.
• The European Union's Carbon Border Adjustment Mechanism (CBAM), covering sectors such as iron, steel, cement and aluminium, also raises concerns about the impact of unilateral climate-related trade measures on industrial development in the Global South.

Way Forward: Returning to the Basics of Climate Action

• Experts argue that COP31 must prioritise measurable climate commitments rather than relying on emerging narratives and future technological possibilities.
• Key priorities include:
  • Immediate emissions reduction: Developed countries should undertake deep and sustained domestic emissions reductions and achieve net-zero well before 2050.
  • Net-negative emissions: Countries with historically high emissions should pursue net-negative emissions within their own borders rather than relying excessively on developing countries' forests and land.
  • Predictable climate finance: Developing countries require grant-based public finance rather than loans or uncertain private investment commitments.
  • Technology transfer: International negotiations must address intellectual property barriers that make clean technologies expensive for developing countries.
  • Carbon-budget accountability: Countries should discuss the remaining global carbon budget and their respective historical contributions to emissions.
  • Safeguards for overshoot pathways: Any proposed carbon-removal strategy must account for scientific uncertainty, technical feasibility, food security, biodiversity and indigenous communities.
• Article 9.1 of the Paris Agreement is particularly relevant, as it recognises the obligation of developed countries to provide financial resources to developing countries for mitigation and adaptation.

Context:

• The Union Cabinet approved a second engagement of two years for 75% of Agniveers who would otherwise leave the armed forces after their initial four-year tenure.
• The decision provides additional opportunities to serving Agniveers but also raises fundamental questions about the Agnipath scheme's original objectives, military effectiveness, technical expertise and long-term career progression.
• The argument is that military capability depends not merely on recruitment numbers but also on the experience and specialised skills developed over years of service.

Agnipath Scheme:

• Original objectives:
  • Reduced average age: Rapid turnover of personnel to create a younger armed force.
  • Lower pension expenditure: Only 25% of Agniveers would be absorbed into regular service, thereby limiting long-term pension liabilities.
  • Civilian reintegration: The remaining 75% would enter civilian life with savings, skills and preferential employment opportunities.
• Recent modification:
  • The Cabinet has approved an additional two-year engagement for 75% of Agniveers after their initial four-year tenure.
  • This means a substantial proportion may now serve for six years before leaving or entering regular service.
• Concerns:
  • The extension may require recalculating the scheme's impact on the average age profile and pension expenditure.
  • Agniveers leaving after six years may face greater difficulties in civilian employment, particularly if promised employment preferences and support remain inadequate.
  • The Chief of Defence Staff (CDS) has suggested that wider opportunities within the armed forces reduce the need for reserved vacancies in police and paramilitary forces. However, regular absorption remains uncertain.

Impact on Military Professionalism and Career Progression:

• Military effectiveness:
  • It requires personnel to evolve from basic operators into skilled supervisors and junior leaders.
  • Progression from positions such as Seaman, Rifleman and Aircraftsman involves increasing technical competence, responsibility and authority.
  • Under the initial four-year engagement, Agniveers cannot progress through the established career structure in the same manner as regular personnel.
  • Those absorbed into regular service after four years will have a two-year advantage over 2nd-engagement Agniveers in professional courses, promotions and pay progression.
• Unresolved issues:
  • The Cabinet has promised unspecified seniority benefits to Agniveers undertaking a second engagement.
  • However, the CDS has indicated that they will rank below the 25% initially selected for regular absorption.
  • Clarity is required regarding their access to professional training, promotions, remuneration and career advancement.

Technical Expertise - A Major Challenge:

• Importance of specialised technical cadres:
  • The Navy's former Artificer system illustrates the importance of long-term skill development.
  • Artificers underwent four years of apprenticeship before developing into highly experienced technical specialists.
  • Their expertise enabled them to diagnose and repair complex machinery under challenging operational conditions, often without immediate manufacturer support.
  • The Agnipath system has brought technical recruitment under the same 4-year engagement framework.
• Concerns regarding technical trades:
  • Earlier, Artificer Apprentices entered after Class XII and underwent four years of specialised naval apprenticeship before progressing through an established technical career.
  • The new Agniveer (Apprentice) enters with a three-year civilian engineering diploma, receives naval training and must subsequently qualify for regular service.
  • An engineering diploma provides theoretical foundations, but mastery of sophisticated military equipment (avionics, radar) requires sustained training, practical experience and operational responsibility.
  • Shorter career pathways may affect the development and retention of technical expertise, with implications for equipment reliability, safety and operational readiness.

Legal and Pension-Related Concerns:

• In Ex Navy Direct Entry Artificers Association v. Union of India (2018), the Supreme Court noted that the four-year apprenticeship of Apprentice Entry Artificers had been counted towards pension eligibility.
• Although the judgment does not directly govern Agnipath, it highlights the distinction between training, engagement and pensionable government service.
• An important question remains: Will the years served by Agniveers before regular enrolment count towards qualifying service, or will their pension clock begin only after absorption?
• Clear legal and administrative provisions are necessary to prevent uncertainty regarding pension eligibility and service benefits.

Military Reform Must Be Evidence-Based:

• Sophisticated military equipment requires specialised knowledge that cannot be easily replaced. Developing such expertise demands sustained institutional investment.
• Hence, there is the need of evaluating military reforms through evidence and their actual consequences rather than merely their stated objectives.
• The experience of former naval artificers, some of whom have served in Oman's Royal Yacht Fleet and Air Force, also demonstrates the value of India's military technical expertise.

Way Forward:

• Independent assessment: Submit a comprehensive evaluation of Agnipath's impact on force structure, military competence and financial savings to Parliament's Standing Committee on Defence.
• Trade-specific retention: Determine retention requirements according to the operational and technical needs of individual services and trades.
• Transparent selection: Publish six-year engagement and regular absorption criteria well in advance.
• Career progression: Ensure 2nd-engagement Agniveers have access to professional courses, training, promotion opportunities and appropriate remuneration.
• Pension clarity: Clearly define how initial engagement and subsequent regular service will count towards qualifying service and pension benefits.
• Technical capacity building: Provide specialised training and adequate service duration to retain critical technical expertise.

Conclusion:

• Agnipath was conceived as a military reform, not merely a recruitment arrangement.
• Its success must therefore be evaluated against its ability to strengthen institutional capabilities, operational readiness and professional expertise.