Walmart aims for first India retail store in 12-18 months

US giant Walmart said on Friday it aims to launch its first retail store in India within the next 18 months after the government opened the vast consumer market to foreign chains.

"That is the plan -- to open (stores) in 12 to 18 months," a spokesman for the world's largest retailer by sales told AFP, declining to disclose details including how many branches Walmart might open.

Up until now foreign groups such as Walmart could only operate as wholesalers amid fears that big Western retail chains would swamp India's tens of millions of small family-run stores which dominate the sector.

The government signed into law Thursday a decision to allow foreign multibrand retailers to set up shop in India via joint ventures, as part of a burst of reforms to further open up the economy and kickstart sharply slowing growth.

Walmart, which already operates stores in neighbouring China, is the first foreign company to formally announce its intentions to enter the retail market under the new policy which kicked up a political storm, with the Congress-led government's largest coalition partner pulling out in protest on Friday.

Protests against the reforms were staged across India on Thursday.

To prepare for its store entry, Walmart opened its first wholesale supply outlet in 2009 in alliance with Bharti Enterprises, parent of India's top mobile firm Bharti Airtel, and now has 17 "Best Price" cash-and-carry outfits.

"Walmart has a reasonable amount of experience about the Indian customer and society and that's why I think they can get off the ground reasonably quickly," Arvind Singhal, chairman of Indian consultancy Technopak, told AFP.

Walmart and French supermarket Carrefour, the world's second-largest retailer, and others such as Britain's Tesco had been pressing the country of 1.2 billion people to open up the retail sector to offset tepid Western markets.

India's retail market clocks $500 billion in sales annually, a figure expected to grow to $800 billion in the next five years, Technopak says. Of that, chain stores account for $33 billion, a sum seen growing to $80 billion within five years.

Technopak's Singhal dismissed fears family-owned neighbourhood stores would be pushed out of business by enlarging the foreign retail presence.

"The pie's big enough for everyone. If you look at the projected figure for chain store sales in five years, it represents only 10 percent of total sales," he said.

The government has also imposed curbs, saying foreign multibrand stores can only open in states welcoming them and in cities with over one million people, he noted. Just a third of India's 29 states have said they back retail reforms.

Modernisation of India's retail market would take years, Singhal added. "This transformation will not be overnight."

Tesco, which helps steel-to-tea giant Tata Group operate the Indian company's Star Bazaar chain of 13 stores, said in a statement the company "welcomes this positive development, but we await further detail".

And Carrefour, reported by Indian media in July to have put on hold an expansion plan for wholesale stores in India in the face of a European slowdown, declined to comment. It has two cash-and-carry stores in India.

Earlier this year India allowed foreign companies to own 100 percent of "single-brand" retail ventures, up from an earlier cap of 51 percent.

The move prompted Sweden's IKEA to apply to open outlets in India as it seeks new markets for its flat-pack furniture, although it is still awaiting the government's nod.

pmc/co/ami

Loading...

Editor’s note:Yahoo Philippines encourages responsible comments that add dimension to the discussion. No bashing or hate speech, please. You can express your opinion without slamming others or making derogatory remarks.

  • China says U.S. actions in S.China Sea "irresponsible, dangerous"
    China says U.S. actions in S.China Sea "irresponsible, dangerous"

    By Sui-Lee Wee BEIJING (Reuters) - China said on Friday it was "strongly dissatisfied" after a U.S. military plane flew over part of the South China Sea near where China is building artificial islands, and called on the United States to stop such action or risk causing an accident. The Chinese navy issued eight warnings to the U.S. P8-A Poseidon, the U.S. military's most advanced surveillance aircraft, when it conducted the overflights on Wednesday, according to CNN, which had a team on board …

  • 2015 Hyundai Lateral Drift goes to Philippine Arena
    2015 Hyundai Lateral Drift goes to Philippine Arena

    The smell of burnt rubber and screeching tires are some of the highlights that will be seen at the most adrenaline-pumped drifting event of the year—the 2015 Hyundai Lateral Drift Championship series.   Held at the Philippine Arena in Bocaue, Bulacan, the event will be the biggest venue in the drifting competition. This is the […] The post 2015 Hyundai Lateral Drift goes to Philippine Arena appeared first on Carmudi Philippines. …

  • The Richest Senators In The Philippines
    The Richest Senators In The Philippines

    The 2014 Statement of Assets, Liabilities, and Net Worth for politicians and public servants are now available for anyone to … The post The Richest Senators In The Philippines appeared first on iMoney.ph. …

  • PHILIPPINES PRESS-AirAsia Philippines seeks $500 mln valuation for IPO - Inquirer

    The Philippine unit of Malaysian budget carrier AirAsia Berhad is seeking a valuation of at least $500 million for its initial public offering set within the next two years, the Philippine Daily Inquirer ... …

  • Consultant, facing joblessness, claims P5.9-M lotto pot
    Consultant, facing joblessness, claims P5.9-M lotto pot

    A 39-year-old information technology consultant, whose job contract will expire this month, has claimed his share of the 6/45 Mega Lotto’s P17.8-million jackpot in its May 13 draw, the Philippine Charity Sweepstakes Office (PCSO) announced yesterday. “I could not sleep for the past several days, thinking about where I could get the money to pay my children’s tuition,” the winner told PCSO general manager Jose Ferdinand Rojas II when he received a check for P5.9 million at the PCSO’s central …

  • Cager’s daughter: I will never drive again
    Cager’s daughter: I will never drive again

    Kim Asaytono vowed never to get behind the wheel again after she hit 14 people on Tuesday night and killed one of them. Even if she gets out of jail one day, the 22-year-old daughter of former Philippine Basketball Association player Nelson Asaytono said she no longer wants to drive. Maybe, I will still ride a car but I will never drive again,” she told The STAR in an interview in her jail cell at the Manila Police District headquarters. …

  • Disaster center to rise in Clark
    Disaster center to rise in Clark

    The private sector is set to build a disaster operations center near Clark international airport in Pampanga to strengthen the country’s preparedness against natural calamities. In his closing remarks during a two-day Earthquake Resilience Conference, businessman Manuel V. Pangilinan said yesterday the Philippine Disaster Recovery Foundation (PDRF) would build the center that would serve as base for immediate response to a disaster. Pangilinan, co-chair of the PDRF, said the disaster …

  • China shoos away US plane in disputed sea
    China shoos away US plane in disputed sea

    The Chinese navy warned a US surveillance plane flying over artificial islands that Beijing is creating in the disputed South China Sea to leave the area eight times, according to CNN, which was on board the flight on Wednesday. The P8-A Poseidon, the US military’s most advanced surveillance aircraft, flew at 4,500 meters at its lowest point, CNN said. The incident, along with recent Chinese warnings to Philippine military aircraft to leave areas around the Spratly archipelago in the South …

POLL

Should Aquino be held accountable over the Mamasapano operations?

Loading...
Poll Choice Options