Business Standard

India Inc in a wait-and-watch mode on impact of Rs 2,000 note withdrawal

Real estate sector may face the brunt; CEOs from other sectors hopeful of business as usual

A man counting Rs 2,000 notes. Photo: Shutterstock

Photo: Shutterstock

BS Reporter Mumbai

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CEOs of top Indian companies are in wait-and-watch mode to see how the withdrawal of Rs 2,000 currency note from circulation impacts their businesses.

While the real estate, which still has a large share of cash transactions, will be impacted the most, other sectors will have business as usual, say CEOs.

"I expect business as usual, but we will have to wait and watch and I am hopeful that the impact won’t be that hard on the business," said Tarun Arora, CEO at Zydus Wellness.

Company officials said as witnessed during demonetisation, the deposit accretion of banks may improve marginally in the near term. "This will ease the pressure on deposit rates hikes and could also result in moderation in short-term interest rates," said Karthik Srinivasan, a Senior Vice President of rating firm, Icra.

Vimal Nadar, Head of research at Colliers India, a real estate advisory firm, said the withdrawal of Rs 2,000 rupee-denominated notes is an expected and timely move towards prudent currency management within the realm of maintaining banking and financial discipline.

"Such measures further reduce/ eliminate the probable cash component in high-value real estate transactions. In the last few years, the RERA and  demonetisation have brought in significant levels of transparency in real estate, mainly contributing to fair market price determination," he said.

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First Published: May 19 2023 | 10:37 PM IST

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