New Delhi, March 1 -- India's savings rate, while not alarming, is not as strong as it should be, especially considering the country's low foreign direct investment (FDI) inflows, according to a report by Blume Research.

The report stated that a closer look at savings trends reveals that the biggest concern lies in household financial savings, which have been declining sharply due to a surge in financial liabilities, primarily unsecured personal loans.

It said, "A high savings rate is necessary given low FDI rates. A deep dive into savings illustrates that the culprit is financial savings (as opposed to physical savings), and the reason is rise in financial liabilities, chiefly led by rising (unsecured) personal loans".

The report high...