Tesco, the UK-based retail giant, has continued its global expansion plans by announcing that it plans to set up a wholesale cash and carry business in India.
The group has entered the market alongside Tata Group, which is aiming to grow its hypermarket business in the country.
Tesco has revealed that it will invest around US$115m in the business over the first two years of the operation.
The first outlet will be launched in Mumbai at the end of 2009, Reuters reported, followed by distribution hubs in Delhi and Bangalore to support a network of smaller cash and carry stores that will supply smaller retailers and restaurants.
Current Indian Law states that foreign retailers must set up wholesale or license and franchise arrangements in the country, as seen with Wal-Mart's venture with Bharti Enterprises.
Tesco international and IT director Philip Clarke said that the group would be keen to set up its own retail business if legislation changed.
'If and when it changes, our wholesale business and agreement with the Tata Group gives us great experience of the Indian market place and consumer,' he told Reuters.
