Potassium permanganate ($KMnO_4$) acts as a strong oxidising agent. Its reaction product with iodide depends on the pH of the medium:

1. In acidic medium: Iodide ($I^-$) is oxidised to iodine ($I_2$).
2. In neutral or faintly alkaline solution: Iodide ($I^-$) is oxidised to iodate ($IO_3^-$). The manganese is reduced from +7 ($MnO_4^-$) to +4 ($MnO_2$).

The specific reaction equation provided in the NCERT text is: $2MnO_4^- + H_2O + I^- \rightarrow 2MnO_2 + 2OH^- + IO_3^-$