NEW DELHI: The passage of the Lokpal Bill in the Lok Sabha and the expected clampdown on graft may be good news for most individuals and corporates, but there are fears it may slow down sale of luxury products such as watches, wines and expensive holidays.“If the anti-graft rules are strictly imposed, there will certainly be an impact on the sales of branded luxury items in India,” said Priyadarshini Narendra , vice president of research firm IMRB , which, in a recent report, forecasted India's luxury market to grow 17 per cent next year to exceed $10-billion mark. It is believed that gifting of luxury products is a popular means of bribing. Another factor that has kindled the fear of luxury sales being impacted is that a lot of luxury purchases are cash transactions and much of it is ‘ black money ’ or undeclared in tax filings.Stating that authorities such as the customs department are now keeping a close watch on luxury purchases and require PAN to be provided while shopping for expensive items, Narendra said people are increasingly cautious about spending ‘black money’ for fear of getting caught. Vijay Singh, managing director of Fashion One International, which organises luxury weddings, said many big-ticket purchases and spending happens in cash. “As laws become stricter and the drive against black money gets bigger, there will certainly be an impact on discretionary consumption,” he said.The general consensus is that if the drive against graft and black money strengthens, then India may mirror what has happened in the Chinese luxury market. According to global consultancy Bain & Co, the luxury market in Mainland China grew only 2 per cent between January and November, partly because the government came down heavily on corruption. The Chinese luxury market had grown at 6 per cent in 2012 and 13 per cent in 2011.The Chinese government's effort to curb wastage of public money and weed out corruption has had a large impact on “gifting luxury”, Bain said in its report this week. In fact, it seems the Right to Information (RTI) Act and increased scrutiny of company accounts and government files have already made officials cautious about accepting bribes.Asenior executive with a private company in Delhi, whose job profile includes gifting expensive items like iPads and watches to public sector bankers to ‘manage’ funding for projects, said officials are now afraid to take gifts. “I have seen a few bankers refuse gifts because of strict scrutiny against them,” he said. “I guess that’s the tail effect of a recent incident when a senior banker of a public bank was arrested by the CBI for taking bribe,” he added.Owner of a healthcare firm who deals with bureaucrats in Uttar Pradesh said government offices in Lucknow have CCTV cameras. “No one is openly asking for a bribe. There is fear,” he said. While anti-corruption drive may have some impact of luxury goods sales in the short term, the Indian luxury market is set to boom in the long term, driven by rising disposable incomes and aspirations of young consumers. Already, there are fewer cash transactions in luxury outlets than before.