In March 2023, debt mutual funds in India recorded significant outflows of nearly ₹3 lakh crore, according to the Association of Mutual Funds in India (AMFI). This marks a drastic shift from the ₹42,106 crore inflow observed in February. All 16 sub-categories of debt funds experienced outflows, with liquid funds facing the largest withdrawal of ₹1.34 lakh crore. The outflows were attributed to quarter-end liquidity adjustments by institutional investors, particularly affecting short-term and treasury-oriented funds. Analysts noted that corporate bond and gilt funds also saw outflows, indicating pressure even in higher-quality investment strategies. The overall assets under management for debt funds dropped by 15% to ₹16.51 lakh crore from ₹19.43 lakh crore in February. Despite the current downturn, experts suggest that this situation is likely temporary, with expectations of increased inflows in the coming months due to India's robust economic outlook.