This document provides a project report on the impact of demonetization on various sectors in India. It discusses the objectives and background of the study, including historical examples of demonetization in India. It then analyzes the impact of the 2016 demonetization on specific sectors like automobiles, consumption, and others. For each sector, it outlines the pros and cons, such as automobiles seeing short term impacts due to purchase deferment but demand reviving in the medium term, while two wheelers saw a high negative impact due to their reliance on cash transactions in rural areas.
Demonitisation and its effect on indian economyArijeet Dutta
Demonetization refers to the Indian government's decision on November 8, 2016 to remove Rs 500 and Rs 1000 banknotes from circulation. This was done to curb black money, corruption, and counterfeit currency. It has led to short-term hardship as over 85% of currency was removed overnight. However, it is expected to have long-term positive impacts by reducing black money, corruption, and use of fake currency to fund illegal activities. While some sectors face liquidity issues in the short-run, in the long-run it may lead to greater financial inclusion, reduced inflation, lower interest rates, and increased tax revenues as more money enters the formal economy. Economists believe that after initial disruptions, demon
Demonetization is the act of removing legal tender status of a currency. India demonetized Rs. 500 and Rs. 1000 banknotes in 2016 to curb black money, corruption, and counterfeit currency. While it provided advantages like reducing illegal activity and increasing tax collection, it also had disadvantages such as currency destruction costs, public inconvenience, and slowing down the economy in the short term. The goal of demonetization is to make India's economy cleaner and move it towards greater digitization.
Demonetisation and its impact on indian economySupriya Sharma
Demonetization in India involved removing Rs. 500 and Rs. 1000 currency notes from circulation in November 2016. This was aimed at curbing black money, corruption, terrorism funding, and moving toward a cashless economy. While nearly all demonetized notes were deposited, indicating the failure to remove significant black money, demonetization did increase digitization of the economy. However, it also caused short-term problems like bank lines and cash shortages. Overall, the long-term benefits of a less cash-dependent, more transparent economy are believed to outweigh the short-term costs.
Demonetization aims to curb corruption and black money by removing high denomination banknotes from circulation. It will impact the economy in both positive and negative ways in the short term. Positively, it could reduce inflation, increase deposits in banks for lending, and promote cashless transactions. Negatively, it could severely inconvenience the public, cost the RBI to print new currency, and hit sectors that rely on cash like services. In the long run, demonetization aims to promote transparency, attract investors, and strengthen the financial system by tracking money flows, though big tax evaders may still find ways to hide black money.
This document discusses the impacts of India's 2016 demonetization policy, which removed Rs 500 and Rs 1000 banknotes from circulation. It provides two case studies showing differing impacts: Amul dairy cooperative adapted well to cashless payments, with no employment impacts, while textiles company Raymond saw a 30% sales drop and may lay off 10,000 workers due to its cash-reliant industry. It also discusses inflation falling due to reduced spending, mixed effects on GDP, financial markets seeing initial drops, and economists viewing long-term benefits despite short-term disruptions.
This document is a term paper submitted by Raj Kapoor Bhardwaj for the degree of B.com (Hons) at Rajdhani College, University of Delhi under the supervision of Miss Jyoti Kasana. It discusses the impact of the Indian government's 2016 demonetization of Rs. 500 and Rs. 1000 banknotes. In the acknowledgment and declaration sections, Bhardwaj thanks his supervisor Miss Kasana and declares that the paper represents his original work. The paper then discusses the meaning, background, purpose, operational guidelines, impacts in the short and long term, effects on the economy and key sectors, and overall impact of demonetization in India.
Prime Minister Narendra Modi announced that Rs 500 and Rs 1000 banknotes would no longer be legal tender as of midnight. This was an act of demonetization in India aimed at combating black money and corruption. Demonetization involves removing a currency's status as legal tender and replacing it with a new currency. Previous examples of demonetization in other countries are discussed.
Demonitisation and its effect on indian economyArijeet Dutta
Demonetization refers to the Indian government's decision on November 8, 2016 to remove Rs 500 and Rs 1000 banknotes from circulation. This was done to curb black money, corruption, and counterfeit currency. It has led to short-term hardship as over 85% of currency was removed overnight. However, it is expected to have long-term positive impacts by reducing black money, corruption, and use of fake currency to fund illegal activities. While some sectors face liquidity issues in the short-run, in the long-run it may lead to greater financial inclusion, reduced inflation, lower interest rates, and increased tax revenues as more money enters the formal economy. Economists believe that after initial disruptions, demon
Demonetization is the act of removing legal tender status of a currency. India demonetized Rs. 500 and Rs. 1000 banknotes in 2016 to curb black money, corruption, and counterfeit currency. While it provided advantages like reducing illegal activity and increasing tax collection, it also had disadvantages such as currency destruction costs, public inconvenience, and slowing down the economy in the short term. The goal of demonetization is to make India's economy cleaner and move it towards greater digitization.
Demonetisation and its impact on indian economySupriya Sharma
Demonetization in India involved removing Rs. 500 and Rs. 1000 currency notes from circulation in November 2016. This was aimed at curbing black money, corruption, terrorism funding, and moving toward a cashless economy. While nearly all demonetized notes were deposited, indicating the failure to remove significant black money, demonetization did increase digitization of the economy. However, it also caused short-term problems like bank lines and cash shortages. Overall, the long-term benefits of a less cash-dependent, more transparent economy are believed to outweigh the short-term costs.
Demonetization aims to curb corruption and black money by removing high denomination banknotes from circulation. It will impact the economy in both positive and negative ways in the short term. Positively, it could reduce inflation, increase deposits in banks for lending, and promote cashless transactions. Negatively, it could severely inconvenience the public, cost the RBI to print new currency, and hit sectors that rely on cash like services. In the long run, demonetization aims to promote transparency, attract investors, and strengthen the financial system by tracking money flows, though big tax evaders may still find ways to hide black money.
This document discusses the impacts of India's 2016 demonetization policy, which removed Rs 500 and Rs 1000 banknotes from circulation. It provides two case studies showing differing impacts: Amul dairy cooperative adapted well to cashless payments, with no employment impacts, while textiles company Raymond saw a 30% sales drop and may lay off 10,000 workers due to its cash-reliant industry. It also discusses inflation falling due to reduced spending, mixed effects on GDP, financial markets seeing initial drops, and economists viewing long-term benefits despite short-term disruptions.
This document is a term paper submitted by Raj Kapoor Bhardwaj for the degree of B.com (Hons) at Rajdhani College, University of Delhi under the supervision of Miss Jyoti Kasana. It discusses the impact of the Indian government's 2016 demonetization of Rs. 500 and Rs. 1000 banknotes. In the acknowledgment and declaration sections, Bhardwaj thanks his supervisor Miss Kasana and declares that the paper represents his original work. The paper then discusses the meaning, background, purpose, operational guidelines, impacts in the short and long term, effects on the economy and key sectors, and overall impact of demonetization in India.
Prime Minister Narendra Modi announced that Rs 500 and Rs 1000 banknotes would no longer be legal tender as of midnight. This was an act of demonetization in India aimed at combating black money and corruption. Demonetization involves removing a currency's status as legal tender and replacing it with a new currency. Previous examples of demonetization in other countries are discussed.
On November 8th, 2016 the Government of India announced that Rs. 500 and Rs. 1000 banknotes would no longer be legal tender. This process of withdrawing currency from circulation is known as demonetization. India has previously demonetized its currency in 1946 and 1978. The demonetization was aimed at targeting black money, fake currency, corruption, and terrorist funding. While it may cause short-term economic slowdown and cash shortages, the long-term goals are a reduction in black money, increased digitization and move towards a cashless economy with more financial transparency and tax compliance.
On 8 November 2016, the Government of India announced the demonetization of all ₹500 (US$7.80) and ₹1,000 (US$16) banknotes of the Mahatma Gandhi Series.
Presentation on Demonetization in India Priyanshu7078
this file is uploaded by Pramod Kumar from MIMT
this file is made on the situations of the demonetization. in this file describing in details of related to the demonetization
Powerpoint Presentation on Demonetisation (1)shenagarg44
On 8th November 2016, government announced Demonetisation of all 500 and 1000 rupees bank notes of the Mahatma Gandhi Series.
It also announced the issuance of new 500 and 2000 rupees banknotes.
Definition of Demonetisation, introduction, process to exchange demonetized currency notes, exceptions for withdrawal, reasons behind demonetisation. why demonetisation become masterstroke by PM Modi, evasion attempts after demonetisation, positive and negative effects, results and conclusion on Demonetisation.
A SHORT AND GENERAL PPT COVERING ASPECTS LIKE REACTIONS OF PEOPLE,IMPACTS OF DEMONETISATION:POSITIVE AND NEGATIVE,EFFECTS ON 3 SECTORS AND EFFECT ON THE INDIAN ECONOMY. ALL THE BEST!!!!!
The document summarizes a presentation on demonetization in India. It provides background on demonetization, details what occurred on November 8th 2016 when India demonetized Rs. 500 and Rs. 1000 notes, and explains the reasons for demonetization including fighting black money, corruption, and fake currency. It discusses both the potential positive impacts such as increased transparency and attack on black money holders, as well as negative impacts like temporary cash shortages and inflation. It also outlines long term effects on the economy and digital transactions, and summarizes a Reserve Bank of India report on the effects of demonetization.
This presentation is just designed in public interest and also to make the term DEMONETIZATION lucid to understand. Dont forget to hit like button before you proceed to download. And stay tuned to my channel so that I can serve you better by providing you ppt on current topics............
What happened on 8th Nov, 2016 and all of its positive side are demonstrated via "DEMONETISATION".
This PRESENTATION gives a brief idea about effects on black money, corruption, terror funding, fake currency and on others system.
The document provides background information on India's demonetization initiative in 2016. It discusses how the Indian government made high denomination banknotes of Rs. 500 and Rs. 1000 invalid, and introduced new notes of Rs. 2000 and Rs. 500. The key objectives were to curb black money, counterfeit currency, and terror funding. It outlines the operational guidelines issued, potential benefits like reducing corruption and inflation. Short term impacts included cash shortages and economic disruptions. Long term benefits may include greater tax compliance, reduced real estate prices, and boosting digital payments. Ensuring adequate currency supplies and support measures were important considerations for the policy.
Demonetization is the act of stripping a currency unit of its legal tender status. In India, PM Modi announced on November 8, 2016 that Rs. 500 and Rs. 1000 notes would no longer be legal tender, aiming to tackle black money, corruption, and terror financing. While demonetization may curb black money and corruption in the long run, it has led to short-term economic slowdown and significant inconvenience to the public due to cash shortages and long lines at banks. Whether the costs of demonetization outweigh its benefits remains to be seen.
Demonetization has been a bold step of our present Government. The real result of it on our nation will be seen in coming year. But here is my study on immediate effects of demonetization on various sectors. I hope it helps..
Demonetization is the act of stripping a currency unit of its status as legal tender. In India, demonetization was announced in November 2016 when ₹500 and ₹1000 banknotes were withdrawn as legal tender. The objectives were to curb corruption, counterfeiting, terrorist financing, and discourage a cash economy. While demonetization provided a boost to digital payments and tax revenues in the long run, it also had short term negative impacts like cash shortages, economic slowdown, job losses, and hardship for common citizens and businesses. Banks and the government faced challenges in replenishing cash and managing the transition to a less-cash economy.
The document discusses India's demonetization of 2016. It provides background on the meaning and history of demonetization. On November 8, 2016 the Indian government demonetized Rs 500 and Rs 1000 currency notes, removing 86% of cash from circulation. Objectives included eliminating black money and fake currency. Short term impacts included economic slowdown and job losses. Long term impacts may include increased tax revenue and financial inclusion. However, the implementation faced criticism and the overall costs may have outweighed the benefits.
On November 8th, 2016 the Indian government demonetized Rs. 500 and Rs. 1000 currency notes to curb black money. This created a shortage of cash that slowed economic growth and impacted cash dependent sectors like agriculture. However, it also increased bank deposits and pushed people towards cashless transactions. Overall, demonetization aimed to eliminate black money but faced short term challenges that slowed the economy due to the cash shortage and lack of alternative denominations.
An whole description about demonetisation in india .Its rules and regulations.Its positive impact and negative impact.When it was started and with which purpose.How people reacted.How the world reacted
Demonatisation effect on banking sectorShubham Matta
the effects of demonetisation's effect in banking sector
this is based on the demonetisation happened in india in 2016
we have included the facts and figures and also have told everything we have researched
The document discusses India's demonetization of 500 and 1000 rupee banknotes in November 2016. It provides background on the meaning of demonetization, India's history with it in 1946 and 1978. It then outlines the key aspects of the 2016 policy including exchanging old notes for new ones, deposit procedures, tax implications for deposited cash, initial reactions from support and criticism, effects like cash shortages and increased e-payments, and evasion attempts through gold, salaries, and donations. In conclusion, it argues the long-term benefits of reducing corruption and black money outweigh short-term costs, and the government must ensure a smooth transition to the new currency.
The document provides an introduction and overview of demonetization in India. It discusses the history of demonetization in India, including instances in 1946, 1978, and most recently in 2016 when the government demonetized Rs. 500 and Rs. 1000 currency notes. It outlines the objectives and relevance of studying the impact of demonetization on the Indian economy. The scope of the study includes analyzing short to medium term effects on various sectors such as agriculture, automobiles, real estate, aviation, travel, banking, consumer durables, and healthcare. It concludes with a brief discussion of reviewing related literature.
Demonetization - Impact on the Indian Financial MarketKeshin Pandit
The document summarizes a student project report on the impact of India's 2016 demonetization on its financial market. The report analyzes secondary data from the government and financial institutions to study how demonetization affected areas like the money market, stock market, banks, insurance, and more. The student found that while short-term impacts on citizens were significant, demonetization ultimately achieved the government's goals of reducing black money and increasing digital transactions.
On November 8th, 2016 the Government of India announced that Rs. 500 and Rs. 1000 banknotes would no longer be legal tender. This process of withdrawing currency from circulation is known as demonetization. India has previously demonetized its currency in 1946 and 1978. The demonetization was aimed at targeting black money, fake currency, corruption, and terrorist funding. While it may cause short-term economic slowdown and cash shortages, the long-term goals are a reduction in black money, increased digitization and move towards a cashless economy with more financial transparency and tax compliance.
On 8 November 2016, the Government of India announced the demonetization of all ₹500 (US$7.80) and ₹1,000 (US$16) banknotes of the Mahatma Gandhi Series.
Presentation on Demonetization in India Priyanshu7078
this file is uploaded by Pramod Kumar from MIMT
this file is made on the situations of the demonetization. in this file describing in details of related to the demonetization
Powerpoint Presentation on Demonetisation (1)shenagarg44
On 8th November 2016, government announced Demonetisation of all 500 and 1000 rupees bank notes of the Mahatma Gandhi Series.
It also announced the issuance of new 500 and 2000 rupees banknotes.
Definition of Demonetisation, introduction, process to exchange demonetized currency notes, exceptions for withdrawal, reasons behind demonetisation. why demonetisation become masterstroke by PM Modi, evasion attempts after demonetisation, positive and negative effects, results and conclusion on Demonetisation.
A SHORT AND GENERAL PPT COVERING ASPECTS LIKE REACTIONS OF PEOPLE,IMPACTS OF DEMONETISATION:POSITIVE AND NEGATIVE,EFFECTS ON 3 SECTORS AND EFFECT ON THE INDIAN ECONOMY. ALL THE BEST!!!!!
The document summarizes a presentation on demonetization in India. It provides background on demonetization, details what occurred on November 8th 2016 when India demonetized Rs. 500 and Rs. 1000 notes, and explains the reasons for demonetization including fighting black money, corruption, and fake currency. It discusses both the potential positive impacts such as increased transparency and attack on black money holders, as well as negative impacts like temporary cash shortages and inflation. It also outlines long term effects on the economy and digital transactions, and summarizes a Reserve Bank of India report on the effects of demonetization.
This presentation is just designed in public interest and also to make the term DEMONETIZATION lucid to understand. Dont forget to hit like button before you proceed to download. And stay tuned to my channel so that I can serve you better by providing you ppt on current topics............
What happened on 8th Nov, 2016 and all of its positive side are demonstrated via "DEMONETISATION".
This PRESENTATION gives a brief idea about effects on black money, corruption, terror funding, fake currency and on others system.
The document provides background information on India's demonetization initiative in 2016. It discusses how the Indian government made high denomination banknotes of Rs. 500 and Rs. 1000 invalid, and introduced new notes of Rs. 2000 and Rs. 500. The key objectives were to curb black money, counterfeit currency, and terror funding. It outlines the operational guidelines issued, potential benefits like reducing corruption and inflation. Short term impacts included cash shortages and economic disruptions. Long term benefits may include greater tax compliance, reduced real estate prices, and boosting digital payments. Ensuring adequate currency supplies and support measures were important considerations for the policy.
Demonetization is the act of stripping a currency unit of its legal tender status. In India, PM Modi announced on November 8, 2016 that Rs. 500 and Rs. 1000 notes would no longer be legal tender, aiming to tackle black money, corruption, and terror financing. While demonetization may curb black money and corruption in the long run, it has led to short-term economic slowdown and significant inconvenience to the public due to cash shortages and long lines at banks. Whether the costs of demonetization outweigh its benefits remains to be seen.
Demonetization has been a bold step of our present Government. The real result of it on our nation will be seen in coming year. But here is my study on immediate effects of demonetization on various sectors. I hope it helps..
Demonetization is the act of stripping a currency unit of its status as legal tender. In India, demonetization was announced in November 2016 when ₹500 and ₹1000 banknotes were withdrawn as legal tender. The objectives were to curb corruption, counterfeiting, terrorist financing, and discourage a cash economy. While demonetization provided a boost to digital payments and tax revenues in the long run, it also had short term negative impacts like cash shortages, economic slowdown, job losses, and hardship for common citizens and businesses. Banks and the government faced challenges in replenishing cash and managing the transition to a less-cash economy.
The document discusses India's demonetization of 2016. It provides background on the meaning and history of demonetization. On November 8, 2016 the Indian government demonetized Rs 500 and Rs 1000 currency notes, removing 86% of cash from circulation. Objectives included eliminating black money and fake currency. Short term impacts included economic slowdown and job losses. Long term impacts may include increased tax revenue and financial inclusion. However, the implementation faced criticism and the overall costs may have outweighed the benefits.
On November 8th, 2016 the Indian government demonetized Rs. 500 and Rs. 1000 currency notes to curb black money. This created a shortage of cash that slowed economic growth and impacted cash dependent sectors like agriculture. However, it also increased bank deposits and pushed people towards cashless transactions. Overall, demonetization aimed to eliminate black money but faced short term challenges that slowed the economy due to the cash shortage and lack of alternative denominations.
An whole description about demonetisation in india .Its rules and regulations.Its positive impact and negative impact.When it was started and with which purpose.How people reacted.How the world reacted
Demonatisation effect on banking sectorShubham Matta
the effects of demonetisation's effect in banking sector
this is based on the demonetisation happened in india in 2016
we have included the facts and figures and also have told everything we have researched
The document discusses India's demonetization of 500 and 1000 rupee banknotes in November 2016. It provides background on the meaning of demonetization, India's history with it in 1946 and 1978. It then outlines the key aspects of the 2016 policy including exchanging old notes for new ones, deposit procedures, tax implications for deposited cash, initial reactions from support and criticism, effects like cash shortages and increased e-payments, and evasion attempts through gold, salaries, and donations. In conclusion, it argues the long-term benefits of reducing corruption and black money outweigh short-term costs, and the government must ensure a smooth transition to the new currency.
The document provides an introduction and overview of demonetization in India. It discusses the history of demonetization in India, including instances in 1946, 1978, and most recently in 2016 when the government demonetized Rs. 500 and Rs. 1000 currency notes. It outlines the objectives and relevance of studying the impact of demonetization on the Indian economy. The scope of the study includes analyzing short to medium term effects on various sectors such as agriculture, automobiles, real estate, aviation, travel, banking, consumer durables, and healthcare. It concludes with a brief discussion of reviewing related literature.
Demonetization - Impact on the Indian Financial MarketKeshin Pandit
The document summarizes a student project report on the impact of India's 2016 demonetization on its financial market. The report analyzes secondary data from the government and financial institutions to study how demonetization affected areas like the money market, stock market, banks, insurance, and more. The student found that while short-term impacts on citizens were significant, demonetization ultimately achieved the government's goals of reducing black money and increasing digital transactions.
Demonetization : The Real Effects, Flashback #DeMo 2016, Reasons for Demonetization, Percentage share of denominations before Demonetization, Purpose/Need for Demonetization, Pros & Cons of Demonetization, Benefits of Demonetization (Direct & Indirect), Impact of Demonetization (Short & Long Term), Effect of Demonetization on Indian Economy, Hidden Facts, Reaction on Social Media, Survey @ Local Circle, Impact on Economy – Sector wise, Through the Glasses of Pessimism, Reality Check (example of effect of demonetization), Conclusion.
The reason for this move was simple: India’s Ministry of Finance claimed that 500 and 1,000 rupee notes are being used to finance terrorism, fund illegal drug sales, fuel the black
market, drive counterfeiting, and pay bribes. This so-called “black money” had reputedly built up to such epic proportions that Prime Minister Modi declared that enough was enough,
that he would take it upon himself to wash his country’s currency supply in one fell swoop. Demonetization can be said as a „Surgical Strike‟ on Black Money, Terrorism, Fake
Currency, Unorganized trading, Real Estate, Share market etc. on the other hand if we talk about the Indian industry on a broader way it can be categories in three parts Manufacturing
sector, Service sector and Agriculture sector. After demonetization only Agriculture sector shows some positive improvement while if we talk about the manufacturing and service sector both were crashed down and these will affect the whole Indian market in 2017 also. As of December 28, official sources said that the Income Tax department detected over 4,172 crore of un-disclosed income and seized new notes worth 105 crore as part of its country-wide operations. The department carried out a total of 983 search, survey and enquiry operations
under the provisions of the Income Tax Act and has issued 5,027 notices to various entities on charges of tax evasion and hawala-like dealings. The department also seized cash and
jewellery worth over 549 crore out of which the new currency seized (majority of them 2000 notes) is valued at about 105 crore. The department also referred a total of 477 cases to
other agencies like the CBI and the Enforcement Directorate (ED) to probe other financial crimes like money laundering, disproportionate assets and corruption.
Demonetization is defined as the act of cancelling the legal tender status of a currency unit in circulation. In India, demonetization occurred in 2016 when Rs 500 and Rs 1000 banknotes were withdrawn, amounting to 86% of currency in circulation. While objectives included curbing black money and expanding the tax base, short term problems included cash shortages that slowed the economy and job losses in some sectors. However, long term benefits included increased tax revenue collection and a boost to digital payments.
Demonetization involves stripping a currency unit of its legal tender status and replacing an old currency with a new one. In India, demonetization has occurred three times before, removing high-value notes of Rs. 1000, Rs. 5000 and Rs. 10,000 from circulation. On November 8th, 2016, Prime Minister Modi announced that Rs. 500 and Rs. 1000 notes would no longer be legal tender, in an effort to curb black money, corruption and fake currency. This involved exchanging the old notes for new Rs. 500 and Rs. 2000 notes over time. The demonetization was expected to impact prices, demand for goods and real estate, bank liquidity and GDP, but provide benefits like increasing
Demonetization negatively impacted many vendors in India. Due to the removal of Rs. 500 and Rs. 1000 notes, 50% of vendors did not have bank accounts and 30% only had accounts in their home towns, making exchanging the old notes difficult. While some opened accounts through a government program, 80% of vendors preferred saving cash at home rather than depositing in banks. A majority (50-85%) of vendors faced difficulties withdrawing money from ATMs and using digital payments. The demonetization motivated increased cashless transactions long-term but created significant problems for many unorganized sector workers in the short-term.
Demonetization has been a bold step of our present Government. The real result of it on our nation will be seen in coming year. But here is my study on immediate effects of demonetization on various sectors. I hope it helps..
- Demonetization of Rs. 500 and Rs. 1000 currency notes has significantly impacted retailers in India. Small retailers relying on cash transactions have seen a major slump in sales, while organized retailers have faced a drop in store footfalls and sales.
- Online retailers have also seen a dip in sales of around 50% due to a decrease in cash-on-delivery orders in the aftermath of demonetization.
- In the long run, as customers increasingly adopt digital payments, retailers expect sales and footfalls to return to normal levels. Demonetization is aimed at curbing black money, corruption, and use of illicit funds to sponsor terrorism.
This document discusses India's demonetization that occurred in 2016 when the government withdrew the Rs 500 and Rs 1000 currency notes from circulation. It provides background on what demonetization is and the history of it in India. The objectives of the 2016 demonetization are described as targeting black money, corruption, terrorism financing. The impacts of demonetization on various sectors of the economy are discussed such as agriculture, banking, real estate, tourism, education, and healthcare. Challenges of the demonetization process and its effects in rural areas are also summarized.
The document discusses the Indian government's decision to demonetize Rs. 500 and Rs. 1000 currency notes. It provides background on the increase in fake currency and black money fueling corruption. The government aims to curb these issues by removing the higher denomination notes from circulation. While this creates short-term hardship, the long-term goals are to bring transparency, reduce corruption, and benefit ordinary citizens and the economy. The impacts on various sectors and pros and cons are debated.
Effects of demonetisation on the retail business of puneIJARIIT
The Modi government’s demonetisation move has had an impact on several sectors, especially real estate. How could
retail be far behind? Given Indian’s propensity to deal in cash, especially when shopping in luxury malls and high streets, retail
will see the short-term impact on sales. The media has already reported how retail sales have dwindled in the immediate aftermath
of the government’s announcement, and how millions of new users are registering on portals offering digital payment services.
The study was conducted by meeting respondents personally and by generating the questionnaire online by means of a Google
spreadsheet, where different retailers of different products were interviewed.
Through this study findings, I could learn that demonetisation negatively affected the middle class the most, followed by the
lower and higher class retail business firms. Surprisingly, the higher class of retail firms was not affected much due to their
dependence on plastic money. In fact, they were also to some extent positively affected as they had many customers seeking them
to dispose of their illegally stored currency notes of Rs. 500 and Rs. 1000.
However, demonetization seems to have largely achieved the objective of its introduction in India, as would the findings of the
study reveal.
I had an amazing experience while doing this research which was full of learnings.
Effects of demonetization hariganesh sHariganesh S
The document discusses the effects of India's 2016 demonetization initiative which removed Rs 500 and Rs 1000 currency notes from circulation. It provides background on demonetization, examines both short-term and long-term economic impacts including a potential slowdown in GDP growth, improved tax compliance, negative effects on small businesses and employment, and an increase in cashless transactions. While demonetization aimed to reduce black money and corruption, critics argue the move has disproportionately impacted the common man while only a small portion of black money was removed from the system long-term.
Demonetization has severely impacted India's agricultural sector, which relies heavily on cash transactions and accounts for nearly half of India's workforce. The removal of high-value currency notes invalidated 86% of India's cash, disrupting farmers' ability to purchase seeds, fertilizers, and other supplies due to lack of funds. While short-term effects included reduced crop sowing and prices crashing as produce rotted, long-term impacts may include investment in agriculture through recovery of black money, lower interest rates, and improved irrigation. However, rural farmers distant from banks face significant difficulties unless solutions reach them.
1. The document analyzes the impact of India's 2016 demonetization policy, which removed Rs. 500 and Rs. 1000 currency notes from circulation.
2. It discusses several short and long term impacts, including a reduction in black money and terror funding, a slowdown in the real estate sector, difficulties for political parties ahead of elections, increased adoption of digital payments, and temporary cash shortages.
3. While consumption and economic growth may be negatively impacted in the short term, the document argues demonetization will provide long term benefits by increasing transparency and reducing black money over time.
MTBiz is for you if you are looking for contemporary information on business, economy and especially on banking industry of Bangladesh. You would also find periodical information on Global Economy and Commodity Markets.
DEMONETISATION IN INDIA AND ITS IMPACT SREEKESH VP
On 8 November 2016, the Government of India announced the demonetisation of all ₹500 (US$7.40) and ₹1,000 (US$15) banknotes of the Mahatma Gandhi Series.[2] The government claimed that the action would curtail the shadow economy and crack down on the use of illicit and counterfeit cash to fund illegal activity and terrorism
Demonetization in India withdrew ₹500 and ₹1000 currency notes from circulation in November 2016 to curb black money, corruption, and terrorism financing. It led to short term negative impacts like cash short
Similar to Study on impact of demonetization on various sectors by Sachin Bhurase (20)
Business communication involves the sharing of information between individuals and organizations for commercial benefit. It aims to exchange information, maintain coordination, achieve goals, and solve problems. The key components of the communication process are the sender, message, encoding, channel, receiver, decoding, and feedback. Barriers like physical, semantic, organizational, and psychological factors can interfere with effective communication. Different types of business communication include internal, external, formal, informal, vertical, horizontal, and diagonal communication as well as oral, written, and nonverbal forms. Following communication principles like completeness, conciseness, consideration, clarity, concreteness, courtesy, and correctness can help improve business communication. Business correspondence typically involves letters, memos, emails and reports
Redefining Globalization: Can Asia Lead the World..? Sachin Bhurase
The document discusses mergers and acquisitions in Asian banking and their potential role in global leadership. It notes increasing global risks and argues Asia needs stronger regional governance. The research examines the impact of ICICI Bank mergers on financial performance and non-performing assets. Key findings show mergers generally improved metrics like return on assets and equity but also increased loan to deposit ratios and non-performing assets in some cases. The conclusion states Asia requires larger banks through mergers to strengthen regional legitimacy and governance but still needs to do more to effectively lead the world.
Management is a goal-oriented, social process that is distinct, universal, continuous, and integrative. It involves planning, organizing, staffing, directing, and controlling resources to achieve objectives. As a science, management has universally applicable principles that are derived through systematic observation and experimentation to establish cause-and-effect relationships. It is also an art that requires skill in applying principles to achieve goals through leading people and coordinating resources. Management principles can be applied in all organizations and contexts.
Financial Reporting & Analysis unit i, ii, iii, viiSachin Bhurase
The document provides an overview of financial accounting concepts. It discusses the meaning and objectives of financial accounting, the accounting cycle process, elements of financial statements including assets, liabilities, equity, income and expenses. It also outlines the key users of financial statements both internal and external to a business. Finally, it discusses the regulatory framework for financial reporting in India including different forms of business organizations and accounting concepts and conventions that govern financial statement preparation.
Accountants formulae book by Sachin BhuraseSachin Bhurase
The document outlines various topics related to accounting including:
1. Financial accounting concepts such as book keeping, journal, ledger, trial balance and final accounts.
2. Corporate accounting topics such as issue of shares, redemption of shares, amalgamation and holding company accounts.
3. Cost accounting concepts involving cost sheets, material costing, labour costing and reconciliation of cost and financial accounts.
4. Management accounting topics like ratio analysis, working capital management, cash flow statements and fund flow statements.
The document discusses partnership accounts and accounting treatment of specific issues related to partnerships. It begins by explaining that a partnership allows two or more persons to join together to start and run a business by sharing profits and losses. It notes that while the accounting process is similar to a sole proprietorship, partnerships have additional accounting issues like appropriating profits, treating goodwill, interest on capital, etc. The objectives are then stated as understanding the meaning and characteristics of a partnership, partnership deed, accounting treatments in the absence of a deed, capital accounts, interest calculations, and profit and loss appropriation.
1. The document provides an introduction to accounting, explaining key concepts like bookkeeping, accounting, and their differences. Bookkeeping involves systematically recording financial transactions, while accounting builds on this by classifying, summarizing, analyzing, and communicating the results.
2. It outlines the objectives of accounting as ascertaining profits/losses over periods and depicting the financial position. The main functions of accounting are maintaining records, communicating financial results, and meeting legal requirements.
3. Limitations of accounting are discussed, such as the use of estimates, inability to account for non-monetary events, and that profits alone cannot determine managerial performance. Accounting provides useful but not perfect information for economic decision making.
This document provides information about accounting ratios related to solvency, profitability, and leverage. It defines solvency ratios as ratios that indicate a firm's ability to meet long-term obligations. Specific solvency ratios discussed are the debt-equity ratio and proprietary ratio. Profitability ratios examined include gross profit ratio, net profit ratio, and operating profit ratio. Leverage ratio discussed is return on investment ratio. Examples are provided to demonstrate calculations of these various ratios. The document aims to explain different types of accounting ratios and how they are used to analyze the financial position of a business.
Accounting ratios are calculated from financial statements to analyze liquidity, profitability, and solvency. There are different types of accounting ratios that can be calculated. This document discusses liquidity ratios like current ratio and quick ratio, which measure a firm's ability to meet short-term obligations. It also covers activity or turnover ratios, such as stock turnover ratio, which indicate how efficiently a firm uses its resources. Sample calculations of various ratios are provided using information from income statements and balance sheets.
Financial statements analysis an introductionSachin Bhurase
The document discusses financial statement analysis. It begins by defining financial statement analysis as establishing meaningful relationships between items in the income statement and balance sheet. It then discusses the purpose of analysis, which includes measuring profitability, assessing growth potential, and determining comparative position versus other firms. Finally, it outlines the various parties interested in analyzing financial statements, such as investors, management, suppliers/creditors, and government agencies.
This document discusses financial statements and their importance for businesses. It explains that financial statements include an income statement (trading and profit & loss account) to determine profits/losses over a period, and a balance sheet to ascertain financial position on a given date. The objectives of financial statements are to ascertain business results, financial position, provide information for managers, and help with decision making and assessing solvency. It also distinguishes between capital/revenue expenditures and receipts for preparing the different financial statements.
This document discusses the need for accounting adjustments when preparing financial statements. It explains that adjustments are needed to account for income or expenses that do not pertain to the accounting period, as well as those that have accrued but not been recorded. Common adjustments include closing stock, outstanding expenses, prepaid expenses, accrued income, income received in advance, depreciation, further bad debts, and provision for doubtful debts. The document provides examples of journal entries and how to incorporate these adjustments into the trading account, profit and loss account, and balance sheet.
The document discusses how to prepare trading, profit and loss, and balance sheet statements. It provides steps for preparing trading and profit and loss accounts, including debiting opening stock, purchases, and expenses to trading and crediting sales and closing stock, then transferring gross profit or loss. It explains balance sheets have asset and liability sides and different ordering approaches. Assets are classified as fixed, current, tangible, intangible, and liabilities as long-term and current.
- The document discusses accounting vouchers, which are documents that provide evidence of business transactions and are used to record transactions in the accounting books.
- There are three main types of vouchers: debit vouchers for cash payments, credit vouchers for cash receipts, and transfer vouchers for non-cash transactions like credit purchases.
- Every transaction affects the accounting equation, which is Assets = Liabilities + Capital. Increases or decreases in assets, liabilities, or capital as a result of transactions ensure the equation remains balanced.
This document discusses several key accounting concepts:
1. The business entity concept treats a business and its owners as separate entities for accounting purposes. Transactions between the business and its owners are recorded separately.
2. The realization concept states that revenue should only be recorded in accounting when a transaction is completed and the business has a legal right to receive payment.
3. Accounting concepts like money measurement, cost, dual aspect, and matching provide the basic rules and assumptions for uniformly recording business transactions and preparing financial statements. Consistency and uniformity are important objectives of accounting concepts.
Fundamenatls of Book-Keeping & Accountancy by Sachin BhuraseSachin Bhurase
This document provides an overview of bookkeeping and accounting. It defines bookkeeping as the process of systematically recording all business transactions. As business activities grew more complex, the need arose to record transactions to remember dealings and ascertain profits. Accounting builds upon bookkeeping by classifying, summarizing, and interpreting recorded data to assess a business's financial performance and position. Key terms like assets, liabilities, income, and expenses are also defined. Overall, the document outlines the basic concepts and purposes of bookkeeping and accounting systems.
Conflict Management, Group Dynamics & Organizational Power and PoliticsSachin Bhurase
The document discusses conflict management and emotional intelligence. It defines conflict as a disagreement between parties with incompatible concerns. It presents various views of conflict and discusses the stages and causes of conflict within individuals, between individuals, groups, and organizations. It also outlines strategies for resolving different types of conflicts, including negotiation techniques. Additionally, it defines emotional intelligence as the ability to balance emotion and reason to maximize long-term happiness. It discusses key components of emotional intelligence like self-awareness and social skills.
This document provides information about a seminar on perfect competition and price determination presented by three students and guided by two professors. It first defines perfect competition as a market with many small sellers of identical products such that no single seller can influence the price. It then lists the key features of perfect competition and provides a table showing price determination under perfect competition based on the relationship between total demand, total supply, and price. The document proceeds to explain how firms can earn super-normal, normal, or losses depending on whether their average revenue is above, equal to, or below their average cost at the equilibrium point where marginal revenue equals marginal cost.
meaning of Demand
meaning of Forecasting
meaning of Demand forecasting
objectives of Demand Forecasting
Importance of Demand forecasting
Steps in Demand Forecasting
Methods of demand Forecasting
A toxic combination of 15 years of low growth, and four decades of high inequality, has left Britain poorer and falling behind its peers. Productivity growth is weak and public investment is low, while wages today are no higher than they were before the financial crisis. Britain needs a new economic strategy to lift itself out of stagnation.
Scotland is in many ways a microcosm of this challenge. It has become a hub for creative industries, is home to several world-class universities and a thriving community of businesses – strengths that need to be harness and leveraged. But it also has high levels of deprivation, with homelessness reaching a record high and nearly half a million people living in very deep poverty last year. Scotland won’t be truly thriving unless it finds ways to ensure that all its inhabitants benefit from growth and investment. This is the central challenge facing policy makers both in Holyrood and Westminster.
What should a new national economic strategy for Scotland include? What would the pursuit of stronger economic growth mean for local, national and UK-wide policy makers? How will economic change affect the jobs we do, the places we live and the businesses we work for? And what are the prospects for cities like Glasgow, and nations like Scotland, in rising to these challenges?
The Impact of Generative AI and 4th Industrial RevolutionPaolo Maresca
This infographic explores the transformative power of Generative AI, a key driver of the 4th Industrial Revolution. Discover how Generative AI is revolutionizing industries, accelerating innovation, and shaping the future of work.
Enhancing Asset Quality: Strategies for Financial Institutionsshruti1menon2
Ensuring robust asset quality is not just a mere aspect but a critical cornerstone for the stability and success of financial institutions worldwide. It serves as the bedrock upon which profitability is built and investor confidence is sustained. Therefore, in this presentation, we delve into a comprehensive exploration of strategies that can aid financial institutions in achieving and maintaining superior asset quality.
Economic Risk Factor Update: June 2024 [SlideShare]Commonwealth
May’s reports showed signs of continued economic growth, said Sam Millette, director, fixed income, in his latest Economic Risk Factor Update.
For more market updates, subscribe to The Independent Market Observer at https://blog.commonwealth.com/independent-market-observer.
[4:55 p.m.] Bryan Oates
OJPs are becoming a critical resource for policy-makers and researchers who study the labour market. LMIC continues to work with Vicinity Jobs’ data on OJPs, which can be explored in our Canadian Job Trends Dashboard. Valuable insights have been gained through our analysis of OJP data, including LMIC research lead
Suzanne Spiteri’s recent report on improving the quality and accessibility of job postings to reduce employment barriers for neurodivergent people.
Decoding job postings: Improving accessibility for neurodivergent job seekers
Improving the quality and accessibility of job postings is one way to reduce employment barriers for neurodivergent people.
Falcon stands out as a top-tier P2P Invoice Discounting platform in India, bridging esteemed blue-chip companies and eager investors. Our goal is to transform the investment landscape in India by establishing a comprehensive destination for borrowers and investors with diverse profiles and needs, all while minimizing risk. What sets Falcon apart is the elimination of intermediaries such as commercial banks and depository institutions, allowing investors to enjoy higher yields.
University of North Carolina at Charlotte degree offer diploma Transcripttscdzuip
办理美国UNCC毕业证书制作北卡大学夏洛特分校假文凭定制Q微168899991做UNCC留信网教留服认证海牙认证改UNCC成绩单GPA做UNCC假学位证假文凭高仿毕业证GRE代考如何申请北卡罗莱纳大学夏洛特分校University of North Carolina at Charlotte degree offer diploma Transcript
"Does Foreign Direct Investment Negatively Affect Preservation of Culture in the Global South? Case Studies in Thailand and Cambodia."
Do elements of globalization, such as Foreign Direct Investment (FDI), negatively affect the ability of countries in the Global South to preserve their culture? This research aims to answer this question by employing a cross-sectional comparative case study analysis utilizing methods of difference. Thailand and Cambodia are compared as they are in the same region and have a similar culture. The metric of difference between Thailand and Cambodia is their ability to preserve their culture. This ability is operationalized by their respective attitudes towards FDI; Thailand imposes stringent regulations and limitations on FDI while Cambodia does not hesitate to accept most FDI and imposes fewer limitations. The evidence from this study suggests that FDI from globally influential countries with high gross domestic products (GDPs) (e.g. China, U.S.) challenges the ability of countries with lower GDPs (e.g. Cambodia) to protect their culture. Furthermore, the ability, or lack thereof, of the receiving countries to protect their culture is amplified by the existence and implementation of restrictive FDI policies imposed by their governments.
My study abroad in Bali, Indonesia, inspired this research topic as I noticed how globalization is changing the culture of its people. I learned their language and way of life which helped me understand the beauty and importance of cultural preservation. I believe we could all benefit from learning new perspectives as they could help us ideate solutions to contemporary issues and empathize with others.
Discover the Future of Dogecoin with Our Comprehensive Guidance36 Crypto
Learn in-depth about Dogecoin's trajectory and stay informed with 36crypto's essential and up-to-date information about the crypto space.
Our presentation delves into Dogecoin's potential future, exploring whether it's destined to skyrocket to the moon or face a downward spiral. In addition, it highlights invaluable insights. Don't miss out on this opportunity to enhance your crypto understanding!
https://36crypto.com/the-future-of-dogecoin-how-high-can-this-cryptocurrency-reach/
Optimizing Net Interest Margin (NIM) in the Financial Sector (With Examples).pdfshruti1menon2
NIM is calculated as the difference between interest income earned and interest expenses paid, divided by interest-earning assets.
Importance: NIM serves as a critical measure of a financial institution's profitability and operational efficiency. It reflects how effectively the institution is utilizing its interest-earning assets to generate income while managing interest costs.
Optimizing Net Interest Margin (NIM) in the Financial Sector (With Examples).pdf
Study on impact of demonetization on various sectors by Sachin Bhurase
1. A
PROJECT REPORT
On
“Impact of Demonetization on Various Sectors’’
Submitted to
Indian Institute of Cost and Management Studies & Research
(IndSearch), Pune.
For the fulfillment of Requirements of Written Analysis &
Communication Subject of
Master of Business Administration
Submitted by
Sachin Bhurase
Shubham Ghuge
Pinak Chitanis
Shreyas Pandit
Vaibhav Varade
Sourabh Londhe
Siddharth Dhanedhar
Under the Guidance of
Mr. Prof. Ravi Fadke Sir
2.
3. INTRODUCTION
The dictionary meaning of DEMONETIZE is “To deprive (a metal) of its capacity as a
monetary standard” or “To withdraw from use as currency” According to former governor of
Reserve Bank Of India Raghu Ram Rajan, “Demonetization is the act of stripping a currency
unit of its status as legal tender”. It is the act or process of removing the legal status of currency
unit.
In simple words demonetization can be referred as a change of a national currency in
which the old unit of currency are retired and replaced with the new currency unit.
A currency on which Governor of RBI on behalf of Central Government guarantees by
making statement “I promises to pay the bearer, the sum of money ……” which empowers it a
legal status. From the date of demonetization, all old currencies which are demonetized will
cease to be a legal tender. Such currency cannot be used as money to do any transaction
henceforth, but to replace with a new currency.
Demonetization is withdrawal of units of money from circulation or to cease the status as
legal tender. Demonetization is a process by which a series of currency will not be legal tender.
The series of currency will not be acceptable as valid currency. Demonetization is the act of
stripping a currency unit of its status as legal tender.
Demonetization is necessary whenever there is a change of national currency. The
demonetization of ₹500 and₹1000 banknotes of Mahatma Gandhi series was a policy ordained
by Government of India on 8th
Nov 2016. Immediately from the next day onwards i.e. from
4. 9th
Nov 2016 these notes were ceased to be legal tender in India. The announcement was made by
Prime Minister Mr. Narendra Modi on 8th
Nov 2016, in an unscheduled live television address at
20:15 (IST) and declared those currencies will be invalid and announced the issuance of new
₹500 and ₹2000 banknote for exchange of old currency.
Howbeit, the denominations of ₹100,₹.50, ₹.20, ₹10 and ₹5 of the series remained as
legal tender and were unaffected by the decision.
The Government claimed this decision was taken to stop counterfeiting of the current
banknotes used to fund terrorism and as a fight against to reduce/ eradicate corruption, black
money, drug menace and smuggling.
“In popular parlance, the unofficial economy goes by the name of black money and the
official of white money. Black and white are also variously substituted by number two and
number one, unaccounted and accounted, unreported and reported, unrecorded and recorded and
so on…”
Prof J. C. Sandesara
As every coin has two sides it does have some problems along with its advantages. Here
in this paper I’d like to focus on the impact of demonetization on common man and the troubles
he faced because of demonetization.
Historical back ground:
As per the history, Demonetization is not first time initiative in India.
• 1946, January, bank notes of ₹1000 and ₹10000 rupee notes were withdrawn by
Government of India.
• 1954 New notes of ₹1,000, ₹5,000and ₹10,000 notes were introduced.
5. • 1978, 16th
January, notes of ₹1,000; ₹5,000 and ₹10,000 notes were demonetized by
Jantha Government.
• 1912 Central Board of direct Taxes(CBDT) recommended that demonetization of higher
value denomination notes is not a correct action to curb black money as black
• Money holders maintain only 6% or less than that in cash form and the remaining in
bullion, jewelry and benami prosperities.
• 2016,28th
October The money in circulation in India was ₹17.77 trillion
• 2016,31st
March, as per RBI report total bank notes in circulation were ₹16.42 trillion of
which nearly 86% were ₹500 and ₹1000 notes.24% of the total 90226 million bank notes
were in circulation.
• 2016, November 8th
night at 8.15 pm Indian Prime Minister Mr.Narendra Modi
announced demonetization of ₹500 and ₹1000 rupee notes.
6. OBJECTIVES OF THE STUDY
• To analyze the pros and cons of demonetization.
• To study the positive and negative aspects of demonetization
• To offer suitable suggestions and Recommendations
• To understand meaning and reasons of demonetization.
• To assess the sectorial impact of demonetization on the economy.
• To study the experience of impact of demonetization in various countries in past years
DATA COLLECTION
Primary Data:
No primary data is collected.
Secondary Data:
The study has undertaken with the help of secondary sources of data and already
published data like newspapers, websites and different reports given by the government.
Following methods are used to collect secondary data:
• Various reports on Demonetization
• Books
• Articles and Research Papers
• Internet
7. Need For Demonetization:
• To bring equilibrium between demand for and supply of money in the circulation.
• To reduce the increasing inflationary conditions.
• To check black money.
• To control illegal holding of currency.
• To control illegal, anti-social and anti-National activities.
• To reduce physical currency transactions to bring transparency in all dealings.
• To check corruption.
Objectives of Demonetization:
• To eradicate black money.
• To remove counterfeit currency.
• To fight against terrorism.
• To stop money laundering activities.
• To mitigate corruption and so on.
8. IMPACT OF DEMONETIZATION ON VARIOUS SECTORS
1. AUTOMOBILE AND AUTOMOBILE ANCILLIARY SECTOR:
The automotive industry in India is one of the largest in the world with an annual
production of 23.37 million vehicles in FY 2014-15, following a growth of 8.68 per cent
over the last year. The automobile industry accounts for 7.1 percent of the country's
Gross Domestic Product (GDP).
MARKET SIZE:
• Sales of passenger vehicles increased by 16.7 per cent to 258,000 units in August 2016
driven by better-than-expected monsoon and strong buying sentiment.
• Sales of commercial vehicles grew by 1.53 per cent to 52,996 units.The two-wheeler
industry also performed well. Motorcycle sales grew 22 per cent to 1 million units, while
overall two-wheeler sales grew 26.3 per cent to 1.64 million units.
• Automobile exports grew at a CAGR of 14.65 per cent during 2010-15. Passenger
Vehicles, Commercial Vehicles, Three Wheelers and Two Wheelers grew by 6.89 per
cent, 13.77 percent, 18.69 per cent and 16.60 per cent CAGR during 2010-15.Two
wheelers accounted for the largest share of exports at 69.4 per cent in FY15. Passenger
vehicles comprised a sizeable 16.7 per cent of overall exports. Exports of three wheeler
vehicles registered around 11.1 per cent share in exports in FY15.
• Alternative fuel has the potential to provide for the country's energy demand in the auto
sector as the CNG distribution network in India is expected to rise to 250 cities in 2018
9. from 125 cities in 2014. Also, the luxury car market could register high growth and is
expected to reach 150,000 units by 2020.
PROS:
• Passenger Vehicles: Short term impact due to purchase deferment; demand will revive in
medium term.
• Tractors: Demand to be materially impacted; plus questionable trade practices like over-
invoicing to moderate
• Due to decrease in bank lending rates, the sales might be boosted as the Bike and Car
EMIs become much more affordable.
CONS:
• Two Wheelers: High impact on 2 wheeler sales as large % of rural 2W transactions are
in cash, % transactions backed by loans is lower
• Luxury cars & SUV: Sales will see significant impact due to wealth deterioration and
decline in rural transactions (cash based).
• Commercial Vehicles: Negatively impacted. 2nd
hand truck sales, which had higher % of
cash transactions, will decline sharply (both number of transactions and pricing)
2. CONSUMPTION SECTOR:
Indian consumer segment is broadly segregated into urban and rural markets, and
is attracting marketers from across the world. The sector comprises of a huge middle
class, relatively large affluent class and a small economically disadvantaged class, with
spending anticipated to more than double by 2025. India stood second among all nations
in the global consumer confidence index with a score of 128 points for the quarter ending
June 2016, after Philippines (132).
10. MARKET SIZE:
• The Indian consumer sector has grown at an annual rate of 5.7 per cent between FY 2005
to FY 2015. Annual growth in the Indian consumption market is estimated to be 6.7 per
cent during FY 2015-20 and 7.1 per cent during FY 2021-25.
• The FMCG sector has grown at an annual average of about 11 per cent over the last
decade. The overall FMCG market is expected to increase at (CAGR) of 14.7 per cent to
touch US$ 110.4 billion during 2012-2020, with the rural FMCG market anticipated to
increase at a CAGR of 17.7 per cent to reach US$ 100 billion during 2012-2025.Food
products is the leading segment, accounting for 43 per cent of the overall market.
Personal care (22 per cent) and fabric care (12 per cent) come next in terms of market
share.
PROS:
• Consumer staples: the move should benefit organized retail and hamper the market for
local counterfeit goods.
• Consumer durables: sales through online retail should pick up relatively
• Consumer discretionary: time lower rates should provide a buffer in the medium term.
CONS:
• Consumer staples: Given the need based demand and small purchase tickets, the
impact on demand would be muted
11. • Consumer durables: Sales likely to be hampered over short-term, especially sales
through unorganized channels as cash purchases (~70-75% of the overall sales)
take a hit
• Consumer discretionary: The adverse wealth effect will likely hurt higher end
discretionary demand.
• Liquor: Most of the purchases by retailers are through cash which may bring down
volume in the near term.
3. BANKING SECTOR:
The Indian banking system consists of 26 public sector banks, 25 private sector
banks, 43 foreign banks, 56 regional rural banks, 1,589 urban cooperative banks and
93,550 rural cooperative banks, in addition to cooperative credit institutions. Indian
banking industry has recently witnessed the roll out of innovative banking models like
payments and small finance banks. The central bank granted in-principle approval to 11
payments banks and 10 small finance banks in FY 2015-16.
MARKET SIZE:
• In July 2016, the government allocated Rs 22,915 crore (US$ 3.41 billion) as capital
infusion in 13 public sector banks.
• To reduce the burden of loan repayment on farmers, a provision of Rs 15,000 crore (US$
2.2 billion) has been made in the Union Budget 2016-17 towards interest subvention.
• Under Pradhan Mantri Jan Dhan Yojna (PMJDY), 250.5 million accounts! Have been
opened and 192.2 million RuPay debit cards have been issued as of October 12, 2016.
These new accounts have mustered deposits worth almost Rs 44,480 crore (US$ 6.67
billion).
12. • In September 2015, RBI approved 10 applicants to set up small finance banks, this
approval will be valid for 18 months to comply with the guidelines and conditions
stipulated by RBI. After fulfillment of requirements, RBI would grant banking license to
the selected applicants.
PROS:
• Increased share of savings moving to banks; high CASA ratio (lower cost of funds)
• Lower bond yields resulting in high treasury gains (particularly PSU banks)
• Government’s move to remove higher-value banknotes from circulation would lead to a
surge in deposits, allowing lenders to eventually lower lending rates and lower costs to
service the sector’s debt.
• Paradigm shift towards cashless economy
CONS:
• With any sharp infusion of deposits and relatively limited avenues to lend, the credit
deposit ratio for banks would become unfavorable, and thus impact margins.
• Negative from credit growth perspective and asset quality challenges (banks with high
SME exposure)
• Reduction in deposit interest rate due to high liquidity.
4. NBFC & FINANCE SECTOR:
There are 11,842 Non-Banking Financial Companies (NBFCs) registered with the
Reserve Bank of India out of which a lion's share of 98% are non-deposit accepting with
the balance 2% being deposit accepting NBFCs. Since November 2014, 200 non-deposit
accepting NBFCs having asset size of Rs 5 bn and above have been classified as
13. systemically important. The major NBFCs in India have their relative specializations, for
e.g. HDFC (mortgage loans), Mahindra Finance (agri loans), Power Finance Corporation
(power financer) & Shriram Transport Finance (auto loans).
MARKET SHARE:
• Retail credit of non-banking finance companies (NBFCs) stood at Rs. 5.2 trillion as on
June 30, 2016 registering a y-o-y growth of about 21.5% in Q1 FY 2017 (19.9% in FY
2016) as compared with 14.8% in FY 2015.
• Micro finance and mortgage/SME segments continued to register robust growth, while a
steady revival in the commercial vehicle credit, especially new CVs, gold loans and
passenger vehicle segments supported overall growth.
• The banking system continues to remain the primary source of funding for retail-focussed
NBFCs, accounting for close to 41% of the total borrowings as on June 30, 2016. The
share of funding from long term debentures accounted for 34% of NBFC borrowings
against 33% in March 2015, while the share of CP borrowings was 12% against 10% in
March 2015. Return on average assets (excluding one-time gains and captive financiers)
for retail NBFCs improved to 1.8% (based on trailing 4 quarters ended June 2016) from
about 1.7% in March 2016 as the interest spreads widened with declining funding costs.
PROS:
• Gold Finance: Positive in medium term – Near term disbursements to get hit as high
cash dealing; However, ~75% of gold lending is from unorganized segment which will
gradually shift to organized players.
14. • Micro finance: Positive in medium term – ~70% transactions done in cash; Near term
disbursements/collections to get hit; However, positive in medium to long term as
borrowers shift to bank accounts.
CONS:
• Housing Finance: Negative: LAP/developer loans may see increased delinquencies ;
underlying demand slowdown to affect credit growth
• Auto Finance: Negative: ~60-70% transactions are done in cash; resale values likely to
come down for vehicles; Asset quality issues to worsen
• Asset Finance: Negative: As large chunk of cash based business of asset financing
suffers a setback.
5. HOSPITALITY AND TOURISM SECTOR:
The Indian tourism and hospitality industry has emerged as one of the key drivers
of growth among the services sector in India. The industry is expected to generate 13.45
million jobs! Across sub-segments such as restaurants, hotels and travel agents/tour
operators. India has moved up 13 positions to 52nd rank from 65th in tourism & travel
competitive index.
MARKET SIZE:
• Increase in domestic disposable incomes has continued to support the growth of domestic
and outbound tourism. Total outbound trips increased by 8.7 per cent to 19.9 million in
2015. Inbound tourist volume grew at a Compound Annual Growth Rate (CAGR) of 6.8
per cent during 2010-15.
15. • Foreign Tourist Arrivals (FTAs) in India increased 11.8 per cent year-on-year to 670,000
tourists in August 2016, while Foreign Exchange Earnings (FEEs) from tourism
increased 13.1 per cent year-on-year to Rs 12,903 crore (US$ 1.92 billion).
• Tourist arrivals in India on e-Tourist Visa (e- TV) grew by 196.6 per cent year-on-year to
66,097 tourists in August 2016, attributable to the introduction of e-TV for 150 countries
as against the earlier coverage of 113 countries.
• Online hotel bookings in India are expected to double by 2016 due to the increasing
penetration of the internet and smart phones.
• Total contribution by travel and tourism sector to India’s GDP is expected to increase
from US$ 136.3 billion in 2015 to US$ 275.2 billion in 2025. Travel and tourism is the
third largest foreign exchange earner for India. In 2014, the country managed foreign
exchange earnings of USD 19.7 billion from tourism.
PROS:
• Major gain for online forex marketplace companies like BookMyForex that have
introduced online forex and have been promoting plastic money (forex travel cards)
against online or electronic payments.
CONS:
• Hotels: Demand to be impacted due to slowdown in Domestic Travel. Near Term Impact
on Corporate Travel whereas Inbound demand to remain unaffected.
• Tour operators:
• Domestic Leisure Travel: Severely impacted as majority of spending is in cash.
• Corporate Travel: There may be temporary slowdown in corporate travel due to cash
crunch
16. • Inbound: Inbound travel to remain unaffected
• Outbound: Outbound travel through unorganized players impacted as foreign exchange
usage abroad is mostly in cash.
6. INFRASTRUCTURE SECTOR:
Infrastructure sector is a key driver for the Indian economy. Mr Nitin Gadkari,
Minister of Road Transport and Highways, and Shipping, has announced the
government’s target of Rs 25 trillion (US$ 376.53 billion) investment in infrastructure
over a period of three years, which will include Rs 8 trillion (US$ 120.49 billion) for
developing 27 industrial clusters and an additional Rs 5 trillion (US$ 75.30 billion) for
road, railway and port connectivity projects. Infrastructure sector includes power,
bridges, dams, roads and urban infrastructure development. In August 2016, India
jumped 19 places in World Bank's Logistics Performance Index (LPI) 2016, to rank 35th
amongst 160 countries.
MAKET SIZE:
• Foreign direct investment (fdi) received in construction development sector from april
2000 to march 2016 stood at us$ 24.19 billion, according to the department of industrial
policy and promotion (dipp).
• In the Budget 2015-16, the capital outlays for roads, and railways have been increased by
Rs 140.3 billion (US$ 2.05 billion) and Rs 100.5 billion (US$ 1.47 billion) respectively.
• Government of India plans to launch the National Infrastructure Investment Fund (NIFF)
with an initial corpus of at least Rs 40,000 crore (US$ 5.87 billion).
17. • The NITI Aayog has instructed central public sector units to release 75 per cent of the
amount due to construction contractors and concessionaires of government projects,
which is expected to release over Rs 40,000 crore (US$ 6.02 billion) for projects that are
under dispute.
• The Ministry of Urban Development has approved an investment of Rs 19,170 crore
(US$ 2.81 billion) for improving basic urban infrastructure in 474 cities in 18 states and
Union Territories (UTs) under Atal Mission for Urban Rejuvenation and Transformation
(AMRUT).
PROS:
• EPC/Construction: Most of these projects have big ticket sizes and revenue is from
larger corporate houses and government authorities, which do bank transaction.
Therefore, due to reduction in unorganized sector in the market, their revenues are likely
to increase.
CONS:
• EPC/ Construction: For small contractors, due to cash crunch there will be some
disruption in medium term. Toll collection, which are mainly done in cash, may see some
hiccups in short term.
• Building material: Likely to be negatively impacted as the underlying real estate
demand (~60-65% of consumption) will be severely impacted due to curtailment of black
money. Large part of transactions done in cash in segments like paints, hence likely to be
negatively impacted.
7. OIL & GAS SECTOR:
18. The oil and gas sector is among the six core industries in India and plays a major
role in influencing decision making for all the other important sections of the economy.
Domestic refiners’ import of crude oil increased 9.1 per cent year-on-year to around
18.81 million metric tons during August 2016.
MARKET SIZE:
• Total fuel consumption is expected to grow around 56 per cent in FY 201617 and
thereafter, while consumption of gasoline is expected to grow around 910 per cent over
the medium term, supported by robust passenger vehicle sales amid low crude oil prices.
• India is the fourth largest Liquefied Natural Gas (LNG) importer and accounts for 5.8 per
cent of the total global trade .
• The country's gas production is expected to touch 90 Billion Cubic Metres (BCM) in
2040 from 35 BCM in 2013. Gas pipeline infrastructure in the country stood at 15,808
km in December 2015.
• According to data released by the Department of Industrial Policy and Promotion (DIPP),
the petroleum and natural gas sector attracted FDI worth US$ 6.67 billion between April
2000 and March 2016.
PROS:
• Temporary pick up in demand due to significant pre-buying of auto fuels
• Refiners are to benefit from robust refining margins, capacity expansions and higher fuel
marketing margin.
CONS:
• Over medium term, demand, especially for personal transportation could be somewhat
negatively impacted due to high proportion of cash transactions
19. • Citi Gas: Largely un-impacted, the demand for CNG might get slightly hurt where cash
transactions are high
.
8. REAL ESTATE SECTOR:
Real estate sector is one of the most globally recognized sectors. In India, real
estate is the second largest employer after agriculture and is slated to grow at 30 per cent
over the next decade. The real estate sector comprises four sub sectors - housing, retail,
hospitality, and commercial. The growth of this sector is well complemented by the
growth of the corporate environment and the demand for office space as well as urban
and semi-urban accommodations. The construction industry ranks third among the 14
major sectors in terms of direct , indirect and induced effects in al l sectors of the
economy.
MARKET SIZE:
• The Indian real estate market is expected to touch US$ 180 billion by 2020. The
housing sector alone contributes 56 per cent to the country's Gross Domestic
Product (GDP).
• In the period FY 2008-2020, the market size of this sector is expected to increase
at a Compound Annual Growth Rate (CAGR) of 11.2 per cent.
• Retail, hospitality and commercial real estate are also growing significantly,
providing the much needed infrastructure for India's growing needs.
20. • Private Equity (PE) investments by domestic and international investors in the
Indian realty market declined 30 per cent year on year to US$ 2.5 billion across 48
deals during Jan Sep 2016.
• The construction development sector in India has received Foreign Direct
Investment (FDI) equity inflows to the tune of US$ 24.19 billion in the period Apr
2000 Mar 2016.
PROS:
• Overall decrease in inflation due to low living cost.
• Positive in long term: demonetization coupled with Real Estate Regulation Act, Benami
Act and GST, will transform RE sector in longer term. Key positives expected - increased
transparency, improved investor confidence, better access to funding, higher FDI likely.
• Higher revenue for government in terms of higher registration cost.
CONS:
• Greater impact on small builders, and in specific cities / (Tier 2/3 cities, NCR etc.) /
micro markets where cash dealing was more prevalent. Resale properties impacted
more than primary sales.
• Organized builders may also face demand slowdown in near term. Another view is, if
supply of resale properties declines due to price crash, it may favorably impact
primary sales.
• Registered prices in residential may go up to adjust for cash component Execution of
ongoing projects will be affected, and some developers may face serious fund crunch.
(Manohar chowdhary & Associates, 2016)
21. CONCLUSION
The move by the government to demonetize Rs.500 and Rs.1000 notes by replacing them
with new Rs.500 and Rs.2000 notes has taken the country with surprise. The move by the
government is to tackle the menace of black money, corruption, terror funding and fake
currency. From a market perspective, we think that this is a very welcome move by the
government and which has taken the black money hoarders with surprise. The total value of old
Rs.500 and Rs.1000 notes in the circulation is to the tune of Rs.14.2 trillion, which is about 85%
of the total value of currency in circulation. This means that the total cash has to now pass
though the formal banking channels to get legitimacy. The World Bank in July, 2010 estimated
the size of the shadow economy for India at 20.7% of the Gross Domestic Product (GDP) in
1999 and rising to 23.2% in 2007. Assuming that this figure has not risen since then (quite
unlikely though) and that the cash component of the shadow economy is also proportional (it
could be higher), the estimated unaccounted value of the currency could be to the tune of Rs.3.3
trillion. Now, post the announcement of demonetization by the government this money would
have to either account for by paying the relevant tax and penalties or would get extinguished.
22. There are higher chances of larger proportion of this unaccounted currency getting extinguished
as the tax rate and subsequent legal issues could be prohibitively high for such money
RECOMMENDATIONS & SUGGESTIONS
• First priority should be to preserve cash. Only use cash to buy things which are essential.
• If you have invested in stocks do not panic and sell at a loss. Wait for the markets to
recover.
• If you have higher number of₹500 and ₹1000 currency notes, deposit them in your bank
accounts rather than waiting on long queues to exchange for₹4000 worth notes. There is
no restriction for depositing cash in your account.
• If you have received large amount as cash in real estate transaction or gold sales, you
should deposit that in your bank account. You will have to give your PAN for any cash
deposit above ₹50000 in a day. You should consult a chartered account that will help you
file your tax returns. You may have to pay tax but it is better to pay tax than losing your
money.
• There may be touts approaching you saying that they will take your currency notes for
lesser value like ₹500 notes for ₹100 or ₹200. Do not fall into such offers. Those are
illegal deals. Paying tax will be cheaper and give you peace of mind.
23. • If somebody asks you to deposit their cash in your bank account and later withdraw cash
and return to them, please do not do it. Tomorrow you will be answerable to the tax
authorities for the source such money
• If you are used to making chit payments or repaying some borrowing in cash, give
cheques in the place of cash or do fund transfer to their bank account either through bank
branch or net banking.
• Try to postpone big events by 1 to 2 months if cash is required to pay for various
expenses.
• Avoid long travels particularly for holidays as most often cash is mainly used on such
occasions.
• Try to use debit card as far as possible while purchasing in super markets or for bill
payments.
BIBLIOGRAPHY
1. Manohar chowdhary & Associates. (2016). Demonetization . Impact of Demonetization
on Various Sectors , 11-44.
2. Capital Star Financial Research Pvt. Ltd. (26 nov 2016). Special Report on
Demonetization . capital star investment advisor .
3. Ashika. (2016, December). Insight. Demonetization Impact, pp. 22-27.