By Dharamraj Dhutia

MUMBAI, Feb 3 (Reuters) - The slight rise in India's market borrowing next financial year is unlikely to impact bond yields with the central bank likely buying a significant chunk of the supply as it seeks to manage the banking liquidity deficit, the treasurer at DBS Bank India said.

India will borrow a total of 14.82 trillion rupees ($170 billion) through bonds in the fiscal year starting April 1, the government said on Saturday, higher than what the market expected and also more than this year's 14.01 trillion rupees.

The Reserve Bank of India last week resumed bond purchase auctions after a gap of more than three years and plans to buy more in the coming weeks. It has also picked up bonds from the secondary market.

"The uptick in gross borrowing is not very material because there is a new buyer in the market in the form of RBI," Ashhish Vaidya, managing director and treasurer of global financial markets at DBS Bank India, said on Monday.

"The central bank will be active in managing supply and could buy around 2 trillion rupees in the next financial year or even more."

India's banking system liquidity is expected to be under stress, and unless the country receives a huge amount of foreign inflows, the central bank will have to be present in the bond market, the treasurer said.

Before that, the RBI is likely to embark on a shallow rate easing cycle with a 25-basis-point rate cut on Feb. 7, Vaidya said.

India's central bank could also cut banks' cash reserve ratio by 50 basis points to boost liquidity, he said.

"Ideally, durable liquidity has to be in line with the (monetary policy) stance, and if the stance is probably going to become more accommodative, that itself means there could be some more measures."

Vaidya expects India's 10-year benchmark bond yield IN067934G=CC to ease towards the 6.40% to 6.50% range from 6.67% currently if the rate cut cycle kicks off this week.

"Markets will try and discount a larger move over a period of time if growth numbers continue to deteriorate, which can be the case for one-two quarters," he said.

($1 = 87.1460 Indian rupees)

(Reporting by Dharamraj Dhutia; Editing by Mrigank Dhaniwala)

((Dharamraj.Dhutia@thomsonreuters.com;))