Small savings schemes to be rationalised

Mumbai: The Reserve Bank of India's (RBI) advisory committee on administered interest rates is mulling about rationalisation of small savings instruments offered by the Government and also the tax treatment on such schemes.

In a meeting held yesterday under the chairmanship of Dr Rakesh Mohan, Deputy Governor, RBI, the committee reviewed the progress of implementation of the recommendations of the earlier expert committee on administered interest rates, said a press release.

As per the recommendations of the earlier committee, the entire proceeds of small savings are being transferred to the State governments. Interest rates on small savings have increasingly been aligned to market interest rates, the release said.

Other members of the committee who attended the meeting, were, Dr Ashok Lahiri, Chief Economic Advisor, Ministry of Finance, Mr D. Swarup, Secretary (Expenditure and Budget) Ministry of Finance, Dr Suman Bery, Director General, National Council for Applied Economic Reasearch and Prof Mihir Rakshit, Director, Monetary Research Project, Investment Information and Credit rating Agency of India.