India Inc’s responses mixed on demonetisation anniversary

New Delhi, Nov 8 (IANS) India Inc. on Wednesday expressed mixed responses on the first anniversary of demonetisation.

The Associated Chambers of Commerce of India (Assocham) said its stand on demonetisation — “short term pain, long term gain” — stood correct.

“Indeed, initially the informal and small scale industries as well as the rural economy was impacted, but now the economy has started getting desired results. Hope in the next 12 months the nation would have achieved the set objectives,” said Assocham Secretary General D.S. Rawat.

According to Chandrajit Banerjee, Director General of the Confederation of Indian Industry (CII), demonetisation was a bold move to shift the economy towards greater formalisation for a more stable and sustainable growth process.

For the industry, Banerjee said: “Demonetisation was one of the means towards a transparent, efficient and competitive economy that is now being ushered in through reforms.”

“It contributed to building investor confidence and reassured us that the economic reforms process is heading in the right direction,” he added.

On the contrary, the PHD Chamber of Commerce & Industry (PHDCCI) said the effects of demonetisation still persisted as demand in the economy was still lacklustre and business firms still not enthusiastic in the production process.

“Though demonetisation of Rs 500 and Rs 1,000 currency notes has completed one year today, the industries have still not recovered fully from the aftermath of unearthing 86 per cent of the total currency,” said Anil Khaitan, President, PHDCCI.

Although Khaitan appreciated the efforts of the government to stamp out black money from the system, curb corruption and to move towards less cash society, he added: “Demonetisation drive has impacted the businesses directly or indirectly in terms of impact on demand and sales. The impact of demonetisation was majorly seen on small businesses as they are highly driven by cash transactions.”