The ICICI bond issue is currently open for subscription and will close on December 2, 1999. The other products being offered in this issue are tax saving bond which helps the investors in planning his taxes optimally, regular income bond with monthly, half-yearly and annual interest options, money multiplier bond with monthly, half yearly and annual interest options and money multiplier bond in the nature of deep discount bonds and encash bond which offers easy liquidity.

``The gilt rate plus provides the investors with a safe investment avenue, which yield returns higher than the yield on gilts and ensures withdrawal options at regular intervals,'' said an ICICI official. Gilts are bonds issued by the government ofIndia to raise money largely from institutional investors. The gilt rate plus bond carries a floating rate of interest, payable annually, which would be reset on February one each year at 0.75 per cent over the prevailing average yields on gilts.

The first interest reset would be effective from February 1, 2001. The interest rate for the period from deemed date of allotment to January 31, 2001 has been fixed at 11 per cent per annuam. The maximum interest payable each year would be 12.60 per cent per annum. ``In addition, if an investor continues to hold the bond for the full maturiry period of five years, he is entitled for a loyalty bonus of five per cent of the face value of the bond at the end of five years,'' he said.

``In the current economic scenario, when the interest rates are at a low, most investors find themselves with surplus funds without safe investment avenues which would yield healthy returns. With the interest rates on a downtrend, household savers are wary of committing funds to longterm investments,'' said an analyst. Even though the equity capital market, and IT stocks in particular, are showing signs of revival, the earlier experience in this market remains a cause for concern for the investors.

Investors in anticipation of turnaround in interest rates are also shying away from making investment in debt instruments.