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Panel to help Wal-Mart source goods from India

BS Economy Bureau in New Delhi | June 03, 2004 08:36 IST

The government is going all out to woo Wal-Mart to source its products from India and has decided to set up an inter-ministerial committee to facilitate the global retail giant's purchases from the country. 
 
At present, nearly 90 per cent of Wal-Mart's procurement is from China and the Indian government is targeting to increase the US retailer's annual sourcing to $2 billion in around a year's time. The retail chain had recently come to India to shop for leather products. 
 
It booked initial orders worth around $100 million with five Indian companies including Woodland, Mirza Tanners, Liberty and Farida Shoes. 
 
Government officials said that a high-level team from Wal-Mart would be visiting India later this month to focus on increasing sourcing of home furnishings and gems and jewellery items. 
 
In addition to the textile and commerce ministry officials, the committee would include representatives from export councils like Texprocil and Handicraft Export Promotion Council. 
 
Wal-Mart has been sourcing products like towels from companies like Trident, Welspun and gift articles from Moradabad-based Designco and Mangal Exports from Mumbai. 
 
In addition, Companies like Phase III are helping Wal-Mart meet a part of its furniture purchases. Companies like Uni Design are also exporting gems and jewellery to the retailer. 
 
Representatives from Wal-Mart are also expected to meet Indian textiles exporters at next week's Mega Shows in the United States, organised by the Apparel Export Promotion Council. 
 
In addition, over 50 gems and jewellery exporters are also participating in a show in Las Vegas, some of whom would meet Wal-Mart representatives. 
 
In the past international buyers have complained of infrastructural bottlenecks though they have been satisfied with the quality of service provided by Indian exporters. The government and export promotion councils have also helped buyers like Wal-Mart shortlist prospective exporters. 
 
In addition to Wal-Mart, the government is hardselling India as a sourcing base for other retail chains like Tesco of the United Kingdom, K-Mart, Target Corporation, JC Penney and some sports goods retailers to increase the country's share in total procurements made by these giants. 
 
Officials said the idea was to ensure that at least 10 larger retailers sourced their products from India. 
 
"Over the next two-three years, we expect $ 20-25 billion exports would be to these retail chains which are trying to develop markets like India and Mexico to reduce their dependence on Chinese exporters," said an official.
 
Sourcing plans 

  • At present, nearly 90 per cent of Wal-Mart's procurement is from China.
  • The retail chain had recently come to India to shop for leather products and booked initial orders worth around $100 million with five Indian companies.
  • The government is also hardselling India as a sourcing base to retail chains like Tesco of the UK, K-Mart, Target Corporation, JC Penney and some global sports goods retailers.

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