MUMBAI (Reuters) – India will issue sovereign gold bonds from April onward offering an annual interest rate of 2.50% to domestic investors, a government statement said on Monday.

The bonds will be issued in six tranches until September, and will be sold through banks and designated post offices as part of the government’s market-borrowing programme.

The bonds will have a tenor of eight years but investors will have the option to exit after the fifth year.

India’s gold imports have plunged more than 73% year-on-year in March as record prices and the lockdown related to coronavirus squeezed retail demand.