The pressure has yielded partial results with the government allowing FDI in branded retail. Since the window allows only single-brands to be sold in such retail outlets, companies like Wal-Mart do not benefit.
“We are patient and persistent. We are hopeful that the Indian government would allow FDI in food and grocery retailing soon,” Mr Duke told ET in a free-wheeling chat. “We will meet senior government officials to put our point across,” he added.
Mr Duke did not think that Wal-Mart is set to lose the first mover advantage, thanks to the Reliance's ambitious retail plans. “We are not perturbed by them (Reliance). The Indian consumer is significantly underserved and there's room for many players.”
Even though market sources say that Wal-Mart has put its plans to set up cash-and-carry stores in the backburner, Mr Duke insisted that Wal-Mart is doing research on the Indian market and would come up with the best model for India. The company has posted Lance Rettig to India to do extensive research of the market. The idea is to get the groundwork ready.
Wal-Mart says it has set a target of $630m worth of sourcing from India in '06, creating 1,00,000 jobs in the manufacturing sector. Apart from sourcing, Mr Duke is hopeful of creating several thousands jobs, when FDI opens up in the retail sector.
While the government is also keen to liberalise FDI further, it does not want to stir a hornest's nest by opening up the retail sector for foreign investment. In a way, the government is caught in a dilemma.
If the government says that FDI in retail cannot be opened up now, it will send negative signals to foreign investors. If the wish to open up retail for FDI is expressed, then the Left is sure to come out with critical statements.
marketing@alchempro.com
