India: Wal-Mart to jointly build wholesale outlets

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    BEIJING, Aug. 7 (Xinhuanet) --Wal-Mart Stores Inc. and India's Bharti Enterprises signed an agreement Monday to jointly build wholesale outlets that will purchase goods from farmers and small manufacturers and sell to retailers through a nationwide supply chain.
    The deal may help the U.S. company eventually gain a foothold in India's booming, but much protected, retail business, which is currently dominated by an estimated 12 million mom and pop shops.
    Indian laws do not allow multi-brand foreign retailers to sell directly to consumers, but they can run wholesale operations and provide back-end support to Indian retailers. Indian companies are also allowed to operate stores selling foreign brands under franchise from their producers.
    Bentonville, Ark.-based Wal-Mart and Bharti Enterprises appeared to have worked around these rules, hoping to get the U.S. retail giant an entry into the massive Indian market.
    The companies signed two separate agreements, which Bharti's Managing Director Rajan B Mittal said conform to existing rules and regulations.
    Under the first agreement, the two companies will set up "a 50-50 venture for wholesale cash-and-carry and back-end supply chain management operation in India," a joint statement said.
    The joint venture "will help drive efficiencies across the supply chain and work toward the betterment of India's farmers, manufacturers and retailers," the statement quoted Wal-Mart Vice Chairman Mike Duke as saying.
    Wal-Mart currently imports about 600 million U.S. dollars worth of goods from India, a fraction of what its buys from China for its stores worldwide.
    (Agencies)
               
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