Tuesday night had been the witness of a drastic and bold decision from bringing back the transparency in the money market by copping out Rs 500 and Rs 1000 bank notes from the circulation. Rs 500 and Rs 1000 ban in India may perhaps finally vindicate the corruption of the country. It all came out as an eye-opener when PM of India Shri Narendra Modi had shocked the nation with his November 8 announcement. Nevertheless Indian Government has pulled select denominations of its currency twice before. In the early 70’s and 78 twice Government had come in the rescue of the money market to eradicate counterfeits and black money transaction. Bankers and economists feel that it will create a wave in real estate and gold transaction. These two sectors hold the major stocks where individuals lay up their black money.
An Ambit Capital report says that India’s ‘black economy’ is over Rs 30 lakh crore or about 20 percent of total GDP. However, given the fact that the total currency in circulation amounts to a total of Rs 16.6 lakh crore and a hefty part of would be money that is justified and is in motion, experts declare that it is mostly in the form of gold and real estate investments. In the financial report on black money of 2012 the real estate sector in India contributed 11 percent of the GDP. The ban of 500 and 1000 rupee notes will not only wobble the real estate market but also it will create a ruckus in the recent election process of UP and Punjab as these two states spend a huge cash for political promotion.
Asking on the abrupt impact of the step to demonetize the Rs 500 and Rs 1,000 notes, Deepak Parekh, chairman HDFC Ltd said: “I expect price of real estate to come down. One expects the price of real estate should come down in medium term.” Fight against the black-money will continue unless real estate and gold investment industry will come up with fair and white collar transactions. This is the sole motive of this movement. For the real estate resale industry and small scale builders this revelation will likely to bring more clarity. The practice involves stockpile of unaccounted investment. Housing price might take a downturn which could pull more willing buyers into this investment zone.
Being world’s largest consumer of gold India imports a dollop of gold out of which its total annual consumption is around 900-1,000 tons, some industry associates consider that this might reduce the demand for pure gold in the near future. Stating that there could be short-term impact, PC Jewellers managing director Balram Garg said, “This is a very good decision for long term especially for the organized sector.’’
The Ambit report also throw lights on the bulk of this black money is obtained in physical assets such as real estate and gold. It emblems the purchase of physical assets can be financed by black money not the financial assets.
If you are seeking low budget flats in Ultadanga area please visit our registered office at Sd Group , AA Block, Sector 1, Salt Lake City, Kolkata, West Bengal or call us with your property enquiry at 033-23341245 in office hours. You can post your requirement in our official website www.sdgroupkol.com