Michelin, one of the world's largest tyre manufacturers, has sought the government's approval to undertake cash and carry wholesale trading or bulk imports with ex-bonded warehouse sales.
The company's wholly owned subsidiary in India, Michelin India Pvt Ltd, has sought the Foreign Investment Promotion Board's permission to undertake wholesale trading of tyres in view of the growing demand for its products in the country. "We believe that a stronger commercial presence in India is a key part of our competitive plan," the company said in a recent application.
Michelin executives in Delhi did not respond to queries from Business Standard. But industry sources said the company was looking at large-scale imports from manufacturing bases in neighbouring countries. The subsidiary has been exploring the market and conducting tests for some time now.
Michelin, in its application, said wholesale trading would increase employment opportunities, develop its sales, marketing and distributing network locally as well as globally, create export opportunities from India and generate additional revenue from exports. It said this would also help Michelin to offer a larger variety of its products, with higher performance capabilities.
At present, 100 per cent foreign direct investment is allowed in cash and carry wholesale trading and bulk imports with ex-bonded warehouse sales.
Michelin India was set up as a wholly owned subsidiary in 1996. Originally, its shares were held by The Michelin Group through Michelin Asia (Hong Kong) Ltd. Subsequently, they were transferred to Compagnie Financiere Michelin. The company has permission to manufacture, market and distribute tyres.
Michelin has operations in 170 countries and produces 190.2 million tyres a year for bicycles, cars, trucks, motorcycles, earthmover equipment, buses, subway trains, aircraft and spacecraft. The group also produces 22.3 million maps and guides per year.
