Dubai: Indian businessmen in the Gulf region have responded positively to the currency demonetization measures announced by the Narendra Modi government to tackle black money while others saddled with high denomination notes are worried about exchanging them abroad.

Sudhesh Giriyan, chief operating officer (COO) of Xpress Money, called it a bold and commendable move which will regulate black money and undeclared liquid assets. “He (Prime Minister Narendra Modi) has struck a blow for transparency, ethical earning and made a move towards curbing grey finances," Giriyan said,“We believe that all stakeholders in the current global economic system have a responsibility to stamp out dubious sources of revenue that can be re-purposed towards instability and disenfranchisement ."

He said it is understandable that some customers might be temporarily inconvenienced by this decision but supported the move as it dovetails with efforts to set new standards for transparency in the money transfer and remittance industry.

Kamal Vachani, group director of Al Maya Group and regional director for Electronic & Computer Software Export Promotion Council (ESC), said the overall banking will benefit as cash will come in banks; real estate will hit negatively.

Vachani said there may be little confusion in the market but it will be good for the Indian rupee. “Rupee can appreciate. Over all, it is negative for market in the short-term, however, the liquidity will grow in the system since as people will deposit cash. It should be positive for rates over short term. On a medium to long term positive interest rate would fall. Banks will get flush with money with no incremental borrowers," he said.

Some residents also expressed reservations over the move. Arshad Hussain, an Indian IT professional in Dammam, Saudi Arabia, said the effectiveness of this policy is likely to be less than 10% of the projected objective by the government. “NRIs are not able to exchange their Rs500 and Rs1,000 notes. Even remittance centers such as Saudi Exchange refused to exchange these notes," he said.

Hussain said that this could be a problem as Indians cannot travel to India just to exchange notes. “One Indian can carry only Rs8,000 to India and cannot give it to others to carry. I have had to send notes by post so that someone exchanges it," he said.

Sanjay Prasad, a graphic design professional in Dubai, said this is a good move in the long run but needs streamlining. “You can only deposit in Non Resident Ordinary Rupee (NRO) account but I only have an Non Resident Rupee (NRE) account so it is going to cause a lot of inconvenience in the next few months," he said.

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