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You need to pass the interest entry up to 31-March-2011 and then change the interest rate as 8.6 in the first investment entry.
Once you pass the interest entry up to 31-March, the interest will be calculated on the opening balance with new rate from 1st April onwards as per PPF rules.
It may be a good practice to enter interest every year on 31-March as per your PPF passbook. From April onwards, it will continue to show accrued interest and will appear in overall gain.