Rising rates affect budget math on small savings

On an uptrend: A worker cleans the compound wall of the RBI headquarters in Mumbai. Experts believe Indian banks may continue to hike deposit rates to further align them with the RBI’s repurchase-rate of 6.50%. — AP

NEW DELHI: India recently proposed a lower-than-expected market borrowing programme, as part of a plan that sought to bridge its budget deficit by boosting reliance on the nation’s small savings pool.

The decision on Feb 1 triggered the biggest drop in the benchmark 10-year bond yields in over two months.