Wal-Mart is to open 50 new wholesale outlets in India in the next four to five years and set up an e-commerce platform supplying small shopkeepers.
The world’s largest supermarket shelved earlier plans to open its own retail stores in the Asian country amid fierce opposition from the country’s small shopkeepers, which make up the bulk of the retail sector, and uncertainty over foreign investment rules. In a recent declaration, the Bharatiya Janata Party (BJP) – widely tipped to win the national elections being held currently – said that it would bar foreign direct investment in multi-brand retail if it forms the next government.
By building the new cash and carry outlets, the company sidesteps the issue as full foreign ownership of wholesale outlets is permitted and has not met with political opposition. The company already operates 20 Indian wholesale outlets, selling goods to small shopkeepers, which dominate India’s retail sector.
“We are evaluating and reinforcing procedures and programs relating to all compliance areas, including licensing and permits, food safety, and responsible sourcing, among others,” Scott Price, Wal-Mart's Asia chief executive, said in a statement.
It is believed the first stores will open in western and southern India, including the states of Maharashtra and Andhra Pradesh.
The online business-to-business platform, meanwhile, will be available to Wal-Mart’s cash & carry store members. India does not allow foreign retailers to sell goods online directly to consumers.
