Morning Brief: Pakistan Hikes Defence Budget To Fix Op Sindoor Damage; India’s Fertility Rate Drops Below Replacement Level; Monsoon To Resume Northward Push After Pause

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Pakistan Hikes Defence Budget To Fix Operation Sindoor Damage

Pakistan has increased its defence budget by 20 per cent to $9.17 billion to address damage from India’s Operation Sindoor strikes last month, which targeted airbases and air defence systems. Despite 47 per cent of its $63 billion budget being allocated to debt servicing, Pakistan prioritised defence spending to replace Chinese-supplied weapons like HQ-9 missiles and air defence radars that were hit and destroyed by India.

This marks the second consecutive year of significant defence budget increases, following a 16.4 per cent rise in 2024. Pakistan’s defence spending, however, remains a fraction of India’s $ 77 billion military budget, with economic pressures intensified by debt obligations, particularly to China, its largest lender.

India’s Fertility Rate Drops Below Replacement Level

India’s total fertility rate has fallen to 1.9 births per woman in 2025, below the replacement level of 2.1, signalling a major demographic shift, according to a new UN report. This decline, down from nearly six children per woman in 1960, is attributed to improved education, expanded access to reproductive healthcare, and greater reproductive autonomy for women.

Despite the lower fertility rate, India’s population is projected to reach 1.46 billion in 2025, with a significant youth demographic and 68 per cent of working-age individuals. India population is projected to reach 1.7 billion in about 40 years before its population begins to decline, the report adds.

Monsoon To Resume Northward Push After 13-Day Pause

After nearly two weeks of silence, the monsoon is finally set to move again — and that’s good news for large parts of north and central India baking under a heatwave. Weather experts say some much-needed rain could arrive around June 13, as changing wind and cloud patterns over the Bay of Bengal prepare to push the monsoon forward.

The rains, which had stalled around Mumbai and north Bengal since 29 May, are now expected to spread into Odisha, Jharkhand, Madhya Pradesh, Chhattisgarh, and Maharashtra. One weather system has already formed and is bringing showers to Andhra Pradesh and Karnataka. A second one is expected soon, which could bring heavier rain inland. Until then, heatwave conditions will continue in places like Delhi, Rajasthan, Punjab, and Madhya Pradesh — but relief is finally in sight.

Other Developments

India Plans More Water Storage For Hydro Projects In J&K

India will plan increased water storage for new hydroelectric projects in Jammu and Kashmir still in initial stages, while projects already in the pipeline will remain unchanged due to finalised technical details. Following the suspension of the Indus Waters Treaty, the government aims to boost storage for projects like the Bursar (800 MW) on the Marusudar river, currently under survey, and two of nine planned projects.

The Pakal Dul (1,000 MW) storage-based project on the Chenab, the first of its kind in J&K, with a live storage capacity of nearly 109 million cubic metres, is also being advanced and is expected to be commissioned in 2026. Four other projects are yet to begin construction but are being evaluated for enhanced storage potential.

India iPhone Production Stabilises At Rs 15,000 Crore In May

Apple’s India vendors produced iPhones worth over Rs 15,000 crore in May, down from a March peak of Rs 19,630 crore due to US tariff fears but above the 2024 monthly average of Rs 10,000–11,000 crore, The Economic Times has reported. With Rs 84,000 crore in production this year, matching 2024’s total domestic consumption, experts forecast a steady Rs 15,000 crore monthly rate for 2025.

Tata Electronics, now accounting for 35 per cent of India’s iPhone production after acquiring Wistron’s Karnataka facility and a 60 per cent stake in Pegatron’s plant, has increased its share, while Foxconn holds 65 per cent. Driven partly by US President Donald Trump’s delayed tariff threats, India’s growing role in Apple’s supply chain saw 2024 iPhone assembly revenue reach Rs 1.38 lakh crore.

Equity MF Inflows Drop to 13-Month Low

Inflows into equity mutual funds dropped to a 13-month low of Rs 19,013 crore in May, a 22 per cent decline from Rs 24,269 crore in April, driven by investors cashing in on a market rally, AMFI data revealed Tuesday. Despite the slowdown, systematic investment plans (SIPs) soared to a record Rs 26,688 crore, with 8.56 crore accounts reflecting strong retail investor confidence amid economic and geopolitical uncertainties.

Hybrid funds saw an uptick, with inflows rising 33 per cent as investors leaned toward safer options amid volatility. Total equity assets grew to Rs 32 lakh crore, driven by market gains, with flexi-cap and small-cap funds remaining popular among investors.

Trump Vows To ‘Liberate’ LA, Defends Troop Deployment

US President Donald Trump has defended his decision to deploy 700 Marines and 4,000 National Guard troops to Los Angeles, calling the city a “trash heap” overtaken by gangs and immigration-related unrest. Speaking at an event, Trump accused California’s leadership of allowing chaos to spiral, vowing to “liberate” the city and restore order.

Trump blamed transnational gangs and “rioters bearing foreign flags” for the unrest, claiming national sovereignty is under assault. California officials, including Governor Gavin Newsom, have pushed back, accusing Trump of abusing federal power for political optics. But Trump maintained the move was necessary to safeguard federal assets and ensure public safety.

From The States

Congress 'High Command' Orders Karnataka To Redo Caste Census

The Congress 'high command' has directed the Karnataka government to conduct a fresh caste census within 90 days, citing outdated 2015 data and objections from Vokkaliga, Lingayat, and non-Kuruba communities. The decision, made during a Delhi meeting with Chief Minister Siddaramaiah, Deputy CM D K Shivakumar, Congress president Mallikarjun Kharge, and Rahul Gandhi, aims to address these objections.

The 2015 survey faced criticism for "undercounting" Vokkaligas (over 10 per cent) and Lingayats (close to 11 per cent), and for recommending that Kurubas, Chief Minister Siddaramaiah’s community, be reclassified as "most backward," raising fears among non-Kuruba groups about OBC reservation benefits.

NCP(SP) Leaders Push Back Against Merger Pressure

Top leaders of the NCP (Sharad Pawar faction) are resisting calls to merge with the Ajit Pawar-led group and align with the NDA, despite growing internal pressure to do so. At the party’s foundation day in Pune, Supriya Sule firmly ruled out any rush toward reunification, saying, “There’s no timeline on this.”

She urged party workers to hold their ground, saying the party stands for ideology, not opportunistic power-sharing. Sharad Pawar backed her position, telling the cadre to stay united and not be swayed by the lure of office. The leadership’s remarks made clear that the NCP(SP) is in no mood to fold into the rival faction—for now.

You’re all caught up—until next time.