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After Demonetisation, Scrapped Indian Rs 500 and Rs 1,000 Currency Notes sail to Dubai to end up as Furniture

The firm started using the pulp of the invalid notes as one of the raw materials that are mixed with wood pulp for making hardboard and fibreboard

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Indian currency notes. Pixabay

Dubai, Dec 13, 2016: After demonetisation, Indias invalid Rs 500 and Rs 1,000 currency notes are now on their way to Dubai and may end up in your living room as a piece of furniture or a photo frame, says a report in Gulf News.

About 30 to 40 percent of the hardboard and fibreboard products made by recycling the scrapped notes are being exported through Dubai, P.K. Mayan Mohammad, whose firm in Kerela was chosen by the Reserve Bank of India (RBI) to recycle the demonetised currency notes, told the Dubai-based newspaper.

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“We are exporting the fibreboards to various countries in Europe, Africa and also to Australia,” the paper quoted Mohammad, who was in Dubai, as saying.

The locally imported boards are used for making furniture such as wardrobes, shelves, drawer bottoms, photo frames and mirror frame backing and for making partitions.

Explaining to the newspaper how it all started, Mohammad said the RBI’s regional office in Thiruvananthapuram inquired about his firm’s capability to recycle shredded currency notes a couple of weeks before the government made the demonetization announcement.

The RBI approached Mohammad on October 20. However, he said he had no idea a demonetisation move was afoot at that time.

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“I thought they had decided to recycle the soiled notes instead of burning them. I, too, got to know about the demonetisation plan only when the Prime Minister (Narendra Modi) announced it,” he was quoted by Gulf News as saying.

The company made use of the thermomechanical pulping method. “We are the only facility with this technology (in India). It uses high electrical energy, steam pressure and temperature,” he said.

The firm started using the pulp of the invalid notes as one of the raw materials that are mixed with wood pulp for making hardboard and fibreboard.

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Once that became a success, the RBI asked the company to lift more truckloads of shredded notes.

“We have been picking up almost 60 tonnes of shredded notes a week,” Mohammad told the paper. (IANS)

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Usage of Unaccounted Cash Still Prevalent in Market: Report

Large cash transactions still present in resale realty market

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Significant usage of unaccounted cash is still prevalent in the secondarly real estate market. Pixabay

It has been three years since demonetisation which was implemented with the aim to curb and eradicate black money. But according to a report released on Wednesday, significant usage of unaccounted cash is still prevalent in the secondarily real estate market.

The report prepared by Anarock Property Consultants said that up to 30 per cent of the total transaction value in the secondary or resale residential maket in India can still be paid in cash.

However, the primary sales market in tier-I cities offer the least scope for unaccounted wealth in property deals, it said.

“Demonetization in November 2016 sent Indian residential real estate — till then a preferred laundromat for unaccounted wealth — into an almost terminal tailspin. Even three years after DeMo, the battle is only half-won,” said Anuj Puri, Chairman Aof Anarock Property Consultants.

“The secondary or resale residential real estate market still accommodates black money; at least 30 per cent of the total cost of resale property can still be paid in cash. While more and more buyers and sellers prefer official payment routes as a matter of principle, many still use the resale property market to launder untaxed cash,” he added.

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Many buyers use the resale property market to launder untaxed cash. Pixabay

As per the report, while the trend in the Mumbai Metropolitan Region (MMR) and the National Capital Region (NCR), which are historically notorious for black money in real estate, has tamed considerably in primary sales, their resale property markets still see cash components.

As much as 20-25 per cent of the total resale property cost can still be “adjusted” with black money, it said, adding that in Bengaluru, Pune and Hyderabad, the prevalence of transparent payment routes, even on the resale market, is much higher.

“Unlike the primary sales market, the resale market still lacks strict regulations, making it easier for buyers and sellers to use cash components.

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Also, the primary sales market involves developers with a reputation to protect, while a resale property transaction involves two individuals. The pricing of resale properties also lacks transparency,” the report said.

In the case of direct sales by developers, there are readily-available pricing benchmarks, while in the secondary market, a seller can inflate the price of a property based on location, added features and so on without stating on the books. (IANS)