'Realty, consumer non-durable mkts to be hit by notes ban'

Experts are of the view that ecommerce, real estate and consumer non-durable sectors are likely to be hit by government's move to ban Rs 500 and Rs 1,000 notes, even as they projected the economy to benefit from it in the long run.
In a major fight against black money, fake currency, corruption and terror financing, Prime Minister Narendra Modi last nigh announced demonetisation of Rs 1,000 and Rs 500 notes with effect from today.
"The impact would be felt by every part of the economy with real estate sector feeling the biggest and a far reaching impact. Consumption would be hit India-wide in the short term," said Rakesh Nangia Managing Partner Nangia &Co.

E-commerce sector having cash on delivery may feel impact on sales. Every unorganised sector in every trade will feel the impact of this bold move, he said.
Anis Chakravarty, Lead Economist, Deloitte India said the commodities and agricultural sector including the market for consumer non-durables is expected to feel the heat.
"However, the largest impact in the medium to long term is likely to be the real estate sector which possibly will have the largest negative impact," he said.

Mukesh Butani, Managing Partner, BMR Legal said government's move was driven by national security concerns and wider agenda to filter out unaccounted income

"Timing was perfect - a month after closure of the income disclosure week and a week after Diwali such that the impact of short term disruption in festive period is minimised," Butani said.
Experts said high denomination currency in circulation in past 5 years vis-a-vis economic growth pointed towards indicators of unaccounted money in circulation.
"This is a masterstroke move by the Government and in the long run, the move will give the economy a positive fillip leading to an increase in GDP also," Nangia said.
Chakravarty said on a positive note, there will be a reset of expectations as this represents in the long term a big push to the cashless economy and businesses in the fin tech sector are expected to see gains.

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Commenting the surprise decision on currency notes, Amit Singhania, Partner, Shardul Amarchand Mangaldas and Co said one who has legitimate cash arising from ordinary course of business and properly accounted in books of accounts, should not have any apprehension against this move of the government.
"However, this step may invite some issues for small and middle level traders/businesses considering high level of cash accumulations lying with them. More often cash is equated with black money. However, one should not get confused with it," he said.
MD and CEO of Federal Bank Shyam Srinivasan said the move to demonetize the 500 and 1000 rupee notes is indeed a seminal move.

"Near term volatilities not withstanding, this audacious and forward looking move will bring great stability and transparency to the way business is conducted in the country," he said.
In his reaction, CEO of Businesswindo.Com said: "Since every businessman has second sales and that unaccounted money will now move into banking system".
He further said black money is mostly in foreign currency, in foreign banks, in the form gold or in properties and less in cash, "hence, this steps alone is not going to help in unearthing black money, but still its good decision which would change the whole scenario of our country".

Ashwani Kumar, Chairman and MD of Dena Bank said it is a well planned and executed surgical strike on the menace.
In his reaction, T R Ramachandran, Group Country Manager, India and South Asia, VISA said "this is one of the most significant steps that we have seen so far towards India becoming a cashless economy".
Welcoming the decision, Porush Singh, Country Corporate Officer, India and Division President, South Asia, Mastercard said the move will enable further growth in the Indian economy by encouraging cashless transactions and reducing crime rate.