KOCHI/MUMBAI (Commodity Online): Finally, festival season has dawned on India this year with Rakshabandhan celebrations on Wednesday and Indians’ hunger for gold has also come back with a vengeance.

Till now, Indian shave been shying away from gold because of the rising prices and now they are back in jewellery shops.

The high prices of around Rs 15,000 per 10 gm gold had been keeping customers away from jewellery shops in India for the past few months.

However, the onset of festival season this year has brought the customers back to jewellery shops.

Anticipating a rise in sales, wholesalers are stocking up gold as the busy season gets under way in the world’s largest bullion consumer.

India, which accounted for more than 20 per cent of global demand for gold jewellery in 2008, celebrates Rakshabandhan, Janmasthami and Ganesh Chaturthi in August, when demand for bullion usually picks up.

Elsewhere in Asia, gold’s rise to a two-month high above $970 an ounce spurred selling, but premiums for gold bars were steady at 70 cents to the spot London price in Singapore, suggesting that consumers would still buy on dips.

However, lack of monsoon rains has played a spoilsport for the north Indian areas as farmers fear a huge crop loss this year. Anticipating difficult times, farmers are keeping away from jewellery shops.

Weak monsoon rains could hurt demand because farmers, who account for 65 per cent of India’s gold demand, depend on good harvests, but some dealers said wholesalers were active in the local market, looking for an opportunity to buy.

The most active October contract on the Indian gold futures added Rs 25, to Rs 14,920 per 10 gm on Wednesday.

India’s jewellery demand has suffered because of high global prices earlier this year and slowdown.

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