My two rupees on Walmart entering India

While I’ve been travelling, something big has hit the news. Bruce Nussbaum has already blogged about Walmart choosing to partner with local partner Bharti Enterprises to enter India; and hopes that this partnership would better assist Walmart with their transition into this complex retail market. They’re doing exceeding well apparently in China, the other big Asian market, can they adapt to the bazaar?

The Indian media, OTOH, seems to be having a field day with the news – The Times of India discusses the impact of this venture on the entire retail landscape, here’s an intriguing snippet,

And as with any global giant, Wal-Mart is also not without its share of criticism. From underpaying workers, squeezing suppliers to monopolistic practices and wiping out neighbourhood mom-and-pop stores, it has been accused of all these, in its endeavour to sell at the lowest price. So what does Wal-Mart’s entry mean for Indian competitors and the consumer ? Very little, for the moment.

With organised retail still accounting for 3% and growing at above 30% per annum, there is more than enough room for everyone to grow.

So instead of competing, everybody is focusing on the Wal-Mart effect or the employment opportunities and consumption boost such large investments create.

while political parties raise the spectre of whether their mode of entry is even legal based on India’s current FDI regulations.

This is a wild card right now, imho, but I’ll have more to add on this once I’m in Delhi and talking to more people. This is a story that will continue…

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3 Responses to My two rupees on Walmart entering India

  1. manish says:

    This is great for India is Indian government knows what they doing…

  2. sunil sudhakaran says:

    The Organised Retail scene is hotting up in india….with some biggies moving in…..walmart being the latest.
    Reliance is investing Rs 25,000 crore in its retail venture….by opening numerous small format markets.
    http://www.thehindubusinessline.com/mentor/2006/11/13/stories/2006111300201200.htm
    Tha Tatas have tied up with woolworths of australia http://www.tata.com/tata_sons/media/20061010.htm
    Metro (from germany) already has a few large format outlets…
    Woolworths and Metro have found loopholes to get their foot in ……legally….to get a first mover advantage inspite of the FDI regulations.
    when the FDI regulations are lifted…..they would be ahead of the pack.

  3. Vinay Rao says:

    Walmart’s entry is not to be lauded but to be viewed with cautious optimism. While they will create a lot of jobs in sales, housekeeping and supply chain logistics, nobody is sure as to what it is that they will stock and where they will source it from. If they are going to pawn their cheap chinese goods here, the urban consumer may not complain, but it is going to create another trade deficit, not to mention lost manufacturing job opportunities in India.
    Kishore Biyani’s future group have got their head screwed on right. They’re buying goods from Indian manufacturers at Chinese prices. Everyone is happy.

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