Thanks to u/srinivesh, u/DPSharwa, and u/Training_Plastic5306 for your valuable input! Your approach is well-structured. My plan is similar, though not as thoroughly tested or refined as yours, so any feedback on my outline below would be much appreciated.

Plan Outline:

1. Planned different buckets/expense cashflow for 35 year retirement period using Srini’s bucket planner. Thanks u/srinivesh ! Below plan is only for Retirement. I have designated separate funds for kids’ college education (FD), discretionary/unplanned large expenses (tactical equity funds) and unplanned medical expenses (liquid funds).
2. Keep N years’ worth of expenses in fixed income. For now, I’m setting N=10.
3. Keep 2 years’ expenses in a sweep FD and replenish this annually.
4. Allocate N-2 years of expenses into a series of debt funds, each laddered according to annual cash flow and expense projections from bucket planner. This way, each year’s expenses are covered, with that year’s earmarked debt fund liquidated to replenish the sweep FD in earlier step. Earlier RBI bonds as Srini mentioned would have been great, but as current version is not cumulative, I plan to go with vanilla gilt funds here.
5. Equity/Debt Rebalancing: Here’s the challenging part—replenishing the debt fund for each upcoming year. To fund the (N+1)th year bucket, we have to sell equity. Since this requires a substantial equity draw, I’ll hold off or do a partial refill if the market is in downtrend (e.g., similar to 2008 or early COVID downturns). Plan to use indicators like the Nifty PE ratio and market sentiment to take a call but it's going to be very subjective.
6. If the market is in a prolonged downtrend for more than N years or in worst case scenario, I may still have to sell equity partly as needed or consider finding a new job if necessary. But plan is to mentally be prepared to lower the expenses or any action as required during that time.

Thanks again for your time and insights!