Apropos, ‘Banks may cut savings, deposit rates again to guard margins’ (June 9). The Reserve Bank of India’s 50 basis points cut in the repo rate is set to trigger a reduction in interest rates on savings accounts and fixed deposits by commercial banks. While the move is aimed at boosting credit flow and stimulating economic growth, it adversely affects senior citizens and individuals who depend on interest income for sustenance. With already low returns on traditional savings instruments, this further decline will strain the financial stability of retirees and risk-averse investors. In light of this, there is an urgent need for banks and policymakers to consider supportive measures, such as special deposit schemes or preferential rates for the elderly, to shield them from the negative effects of falling interest rates.
N Sadhasiva Reddy
Bengaluru
Sustaining FII inflows
It is five years since RBI introduced Fully Accessible Route (FAR), a framework that allowed non-residents (FPIs, NRIs and OCIs) to invest in specified securities by removing caps on foreign investments. It needed the inclusion in EMBI (emerging market bond index) of JP Morgan in June 2024, and Bloomberg’s Emerging Market Local Govt Index to induce FII inflows in FY25.
While it is self-evident that higher interest rates of Indian bond market are an attraction, what is required to keep FPIs hooked is to check foreign exchange volatility.
Angara Venkata Girija Kumar
Chennai
Insects in diet
This refers to ‘Insects: A nutrition powerhouse with a planet-friendly reputation’ (June 9). Despite the enormity of research, the larger question is the acceptability of the new food culture in traditional Indian conditions. Moreover, the rampant use of chemical derivatives in farming has already caused the extinction of several useful insects which are deemed as farmer’s friends.
Rajiv Magal
Halekere Village, Karnataka