Premiums could jump to $10-$12 an ounce over the global benchmark from the current levels of $4-$5, said MMTC-PAMP Managing Director Rajesh Khosla.
Imports could climb to 60-70 tonnes per month for the rest of the year from about 40 tonnes in July, Khosla said, adding that August imports were probably around 63 tonnes.
India has not yet released its trade figures for August.
"Demand is expected to increase in the coming months as people start buying from September because of the festive season," Khosla said.
India, the second biggest buyer of gold after China, will soon celebrate Dhanteras and Diwali festivals, when it is considered auspicious to buy gold.
The wedding season is also boosting demand for the bullion. The precious metal forms an essential part of a bride's dowry in India, and is considered auspicious as a gift or offering at religious festivals.
The expected increase in demand will squeeze supplies amid curbs on gold imports.
Struggling with a high trade deficit, India raised its gold import duty to a record 10 percent last year and made it mandatory to export a fifth of all bullion imports. Gold is India's second-biggest expense on the import bill after oil.
Imports slipped by a fifth in 2013 though demand remained strong, leading to high premiums and an increase in smuggling.