Can anyone here help me know if fixed deposit is considered a debt instrument or not?
Yes, a fixed deposit is a debt instrument.
By definition, a debt instrument is a contractual arrangement between borrower and lender. The borrower promises to pay the lender their principal amount with interest within a stipulated time as per the agreed upon interest rate and repayment schedule.
In a fixed deposit, you lend the bank a lump sum amount and in return, bank pays you interest and returns your principal amount.
Some other debt instruments are bonds, debentures, certificates of deposits, commercial papers, etc.
Long story short, is FD a debt fund? Yep, it is!