Carrefour postpones plans to invest in India


Mumbai, France's Carrefour, the world's second-biggest retailer, has postponed plans to enter India due to concerns over political opposition to multinational retailers entering the market, the Economic Times said.

Carrefour also wanted to see how Wal-Mart fared in the Indian market before stepping in. “We are waiting for some more clarity on the Bharti-Wal-Mart structure. We will not be in a position to announce any concrete India entry plan till policy issues on FDI (foreign direct investment) in retail are made clear," Gerard Freiszmuth, Carrefour's mergers and acquisitions director in India, told the newspaper.

Foreign multiple-brand retailers are limited to cash-and-carry and franchise or licence operations in India."We have been looking at India as an attractive destination and hope to have a long-term association with the country. We are studying and understanding the various pros and cons and will not make an announcement in haste," Freiszmuth said.

Sonia Gandhi, whose Congress Party heads the federal coalition government, had called for the study, saying she was worried that the entry of multinational retailers could threaten millions of small businesses. India does not allow foreign direct investment in the retail sector except for single-brand stores, meaning foreign companies have to sign franchise deals with local companies to gain access.

“We will not be in a position to announce any concrete India entry plan till policy issues on FDI in retail are made clear,” Freiszmuth said.

Earlier this year India's Trade Minister Kamal Nath had said in February that Carrefour was close to signing a deal with India's Wadia group for its retail foray. Local media have also reported the French retailer was in talks with other Indian companies.

Carrefour has a string of stores right across the Middle East including ten in the UAE.