Wal-Mart chief knocks at PM's door

NEW DELHI: Its wall-to-wall influence in America may be waning, but Wal-Mart, the world���s largest retailer, is pushing its cart harder than ever to find its square inch in India.

S Robson Walton, chairman of Wal-Mart Stores, met Prime Minister Manmohan Singh in New Delhi on Wednesday, in what is seen as an effort by the world���s second-largest company to press its demand for permission to invest in multi-brand retail.

The $404-billion Wal-Mart, which has a joint venture with the Bharti group that runs the country���s largest telco for cash-and-carry wholesale trade and a franchise agreement for front-end retail, has been lobbying hard with the government for permission to allow foreign direct investment (FDI) in multi-brand retail.

Rob Walton, the eldest son of Wal-Mart founder Sam Walton, who took over as the chairman of the board of directors at Wal-Mart in 1992 following his father���s death, is credited with the retailer���s successful expansion in international territories. The company has over 8,000 retail units under 53 different banners in 15 countries and sees emerging markets as a significant source for growth.

This is Mr Walton���s first visit to the country. It highlights the importance of India, the second-fastest growing economy after China, in Wal-Mart���s scheme of things.

According to people familiar with the matter, Mr Walton impressed upon the prime minister the benefits an organised retailer like Wal-Mart can bring to farmers as well as small and medium enterprises and in job creation.

The retail sector is considered to be the top job-creator in developed economies ��� Wal-Mart alone employs 2.1 million people globally ��� and leading international retailers have also helped in the creation and sustenance of a large chain of manufacturers in India, which export apparel and many other household items to developed economies.

���We���re stepping up growth in our international operations to take advantage of growing economies and opportunities in emerging markets such as China and Brazil,��� Wal-Mart executive vice-president and chief financial officer Tom Schoewe said in a statement two weeks ago.

The Indian market, too, is crucial for Wal-Mart but current Indian laws don���t allow foreign retailers to open multi-brand stores. Foreign investment is allowed only in single-brand retail to the extent of 51%.

Wal-Mart���s key executives have been visiting India in a bid to test the local political and business climate. With the arrival of Mr Walton, it seems Wal-Mart is stepping up its efforts. Just four months ago, Doug McMillon, the CEO of the company���s international business, was in India meeting agriculture and commerce ministers.

The conversation last time veered on the Indian establishment asking the retailer to strengthen the supply-chain that could benefit Indian farmers. Mr McMillon had then said Wal-Mart���s progress in India would have no dollar constraint. ���We have a $4.8-5.3-billion fund earmaked for our international business. India can use as much as it wants,��� he had said.

Wal-Mart announced its alliance with Bharti in 2006, but has opened only one cash-and-carry wholesale store since. Mr McMillon had then said the company was not in a hurry. ���Our aim is to get it right.���

The Indian retail landscape is filled with newcomers still trying to find a grip on the fast-evolving market. Future Group, India���s largest retailer, runs several retail formats under the Big Bazaar, Home Town and eZone stores, while India Inc���s big names Reliance Retail and Aditya Birla Group have their own chain of stores under brand names Reliance Fresh and More, respectively.

While Wal-Mart has a tie-up with Bharti, UK retailer Tesco has tied up with the Tata group���s Trent and Carrefour is in talks with Future to firm up an alliance.