American retail giant Walmart bets on India despite change in FDI norms

Walmart CEO Doug McMillon and Flipkart Co-Founder and CEO Binny Bansal during an programme to announce Walmart Inc.'s acquisition of Flipkart 77% stake, in Bengaluru on May 9, 2018. (Photo: IANS)
Bengaluru: Walmart CEO Doug McMillon and Flipkart Co-Founder and CEO Binny Bansal during an programme to announce Walmart Inc.'s acquisition of Flipkart 77% stake, in Bengaluru on May 9, 2018. (Photo: IANS)

Bengaluru/New
Delhi, Feb 7. American retail giant Walmart and its Indian e-tail major
Flipkart are betting big on India despite the revised norms for Foreign
Direct Investment
(FDI) in e-commerce, the companies said.

“Walmart’s
and Flipkart‘s commitment to India is deep and long term. Despite the
recent changes in regulations, we remain optimistic about the country,”
the regional Chief Executive Officer of Walmart Asia and Canada Dirk Van den
Berghe told IANS in a statement in New Delhi.

The
companies will continue to focus on creating “sustained economic growth
and bringing sustainable benefits to India, including employment generation,
supporting small businesses and farmers, and growing Indian exports to
Walmart’s global markets”, added Berghe, who is also the retail giant’s
Executive Vice President.

Walmart’s
assertion on the company’s commitment to India came after American investment
bank Morgan Stanley in a report on Monday said the former might exit the
country after the new FDI norms in e-commerce came into force on February 1.

“An
exit is likely, not completely out of the question, with the Indian e-commerce
market becoming more complicated,” the New York-based financial services
firm said in its report titled “Assessing Flipkart Risk to Walmart EPS
(earnings per share)”.

In May last
year, Walmart bought 77 per cent equity stake in Flipkart for a whopping $16
billion (Rs 1,16,256 crore).

The revised
FDI norms in e-commerce, however, have tightened the noose around the
businesses of the country’s leading e-tailers – Walmart-owned Flipkart and
Indian arm of American e-commerce giant Amazon.

The policy
revisions, issued by the Ministry of Commerce and Industry on December 26,
2018, barred e-commerce platforms providing a marketplace from exercising
control or ownership over the inventory and forbids any company to sell its
products exclusively on an e-commerce platforms alone.

The e-tail
companies
are now working towards changing the ownership of their
inventory, so as to comply with the norms.

क्या यह ख़बर/ लेख आपको पसंद आया ? कृपया कमेंट बॉक्स में कमेंट भी करें
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कृपया
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स्तम्भ

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