Mumbai: Gold imports went up by 65% to 43 tonnes during October over the corresponding month last year following rise in festive demand due to good monsoon despite the ruling high prices, reports PTI.

Imports during October 2009 stood at 26 tonnes, according to data given by the Bombay Bullion Association (BBA).

According to trade analysts, signs of global economic recovery and good monsoon has drawn customers to the yellow metal despite the ruling high prices. Gold on Saturday ruled at Rs20,440 per 10 grams, while on the international market it was trading at $1,368.80 an ounce.

The country had faced its worst drought in 2009, which badly affected agriculture production, particularly paddy, coupled with world economic crisis made people conserve their savings.

With increasing consumer confidence imports are steadily rising and stood 8.2 tonnes more than in September, which was 34.8 tonnes.

“This year the demand during the festivals was very high as compared to the year-ago period, which resulted in high imports,” industry expert Suresh Hundia told PTI here.

However, after the festive season there is hardly any demand for the precious metal which is likely to affect the November imports, he said.

Analysts feel that, in short term the gold prices will decline by $30-$40 in the global market and Rs500-Rs600 in the domestic markets due to profit taking.

“However, for the medium- and long-term, gold prices will remain bullish on the back of a weak US dollar and global inflationary concerns," analysts said.

From January to October, gold imports stood at 278.5 tonnes, up 92% from 144.7 tonnes in the corresponding period last year, data from BBA shows.

The current gold demand trend in the country indicated a robust year-on-year recovery in imports from the 2009 levels, World Gold Council (WGC) said in a recent report here.

“As consumers have adjusted their price expectations upwards, a further rise in gold jewellery and investment demand is anticipated and this trend is projected to continue over the long-run as local investors are buying gold driven by wealth accumulation motives,” it said.

During the first half of 2010, Indian net retail investment in gold has increased by 264% year-on-year to 93 tonnes, the report ‘India: Heart of Gold’, said.

There is a growing domestic interest in gold investment, triggered by a high savings ratio and the increasing gold investment opportunities available to the investors, the report said.

Based on WGC estimates, India owns over 18,000 tonnes of above ground gold stocks worth approximately $800 billion at today's gold price and representing at least 11% of the global stock.