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Withholding Tax Cut to 5% Eyed as Forex Reserves Fall $38B; ₹37,500 Cr Coal Gasification Scheme Approved

Target:UPSC GS-IIIMPSCBankingSSC GATeachingPrelims HighMains MediumStatic GK Link
17 May 2026
~2 min
Source: Indian Express
Key Data:$38 billion20%5%₹37,500 crore75 million tonnes1,200 seconds
Bodies:RBIHI4CDRDONITI AayogIMRICARISPRLADNOCDGFT
Practice MCQs from today's news ▸
What This Article Covers

1.Government considers slashing withholding tax on foreign bond investments from 20% to 5% to counter a $38 billion forex reserve erosion since March 2025.

2.Union Cabinet approves a ₹37,500 crore scheme to promote 25 surface coal/lignite gasification projects, targeting 75 million tonnes of feedstock.

3.DRDO achieves a 1200-second test run for its actively cooled scramjet combustor, a key milestone for hypersonic cruise missile development.

The Big Picture
Prelims · HighMains · Medium

This week's compendium covers high-impact developments across policy, economy, and technology crucial for competitive exams. Key highlights include a strategic review of withholding tax to stem capital outflows, a major push for coal gasification for energy security, and breakthroughs in hypersonic missile technology, alongside significant international and cultural diplomacy.

Exam Lens

Quick Exam Facts From News

Forex Reserve Erosion$38 billion since March 2025
Current Withholding Tax Rate20%
Proposed WHT Rate5%
Coal Gasification Scheme Outlay₹37,500 crore
DRDO Scramjet Test Duration1,200 seconds
UAE SPR Storage in India30 million barrels
New BRICS Member (2025)Indonesia
PCOS Renamed toPMOS (Polyendocrine Metabolic Ovarian Syndrome)

1-Minute Revision

  • ›Forex Reserve Erosion: $38 billion since March 2025
  • ›Current Withholding Tax Rate: 20%
  • ›Target this Data: Forex reserve erosion is $38 billion since March 2025; Coal gasification scheme outlay is ₹37,500 crore.
  • ›Target this Nodal Body: Indian Strategic Petroleum Reserves Limited (ISPRL) for SPR management; Defence Research and Development Organisation (DRDO) for hypersonic tech.
  • ›Target this Legal Point: Withholding tax on government bonds is governed by Section 194LD of the Income Tax Act.

Mastered this topic? Test your knowledge with a full MCQ quiz.

Practice exam-style questions, track your score, and strengthen your recall.

Q1Static LinkageEasy

The 'Suspect Registry' for sharing intelligence on mule accounts, mentioned in the news, is managed by which agency under the Ministry of Home Affairs?

Q2Statement-basedHard

Consider the following statements regarding developments mentioned in the news:

1. The Anaimangalam Copper Plates, returned by the Netherlands, contain inscriptions in both Sanskrit and Tamil.

2. The newly approved Scheme for Promotion of Surface Coal/Lignite Gasification has an outlay of ₹75,000 crore.

3. The SEHAT mission is a joint initiative of the Indian Council of Medical Research (ICMR) and the Indian Council of Agricultural Research (ICAR).

Which of the statements given above is/are correct?

Q3Data-centricMedium

According to the news, what is the targeted quantity of coal/lignite to be gasified under the newly approved central government scheme?

Q4Application/ImpactMedium

What is the primary strategic objective behind the government's consideration to cut the withholding tax on foreign bond investments?

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