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Foreign Retailers Eye to Set Up Shop in India
Release time:2013-03-27 Source:admin Reads:
Foreign retailers such as Tommy Hilfiger, fashion brand Promod SAS, NA Pali Europe, Italian jewelry maker Damiani International which widely appreciated for unique design and attached with delicate jewelry cards shave sent signals to India's Foreign Investment Promotion Board (FIPB) for entering India, a FIPB official said Wednesday. By far, most of these brands are present in the Indian market through a licensing or franchise arrangement. After the new norms on foreign direct investment (FDI), norms in single-brand retailing and 51 percent in multi-brand retailing, these retailers are keen to go it alone, industry sources say. The official said many foreign brands in lifestyle, apparels, footwear and jewelry with jewelry cards are keen to own 51 percent in single-brand retail operations in India. Today India may be seen as a suitable place to manufacture jewelry as it own sufficient resource and cheap labor force. Recently, Inditex-owned brand Zara had faced FIPB hurdles for setting up stores of Massimo Dutti as the rules for single-brand retail stipulate that the company making the FDI proposal needs to also own the brand, not a different entity. Officials said Zara can re-apply as the Department of Industrial Policy and Promotion (DIPP) has done away with the norm that the foreign investor has to own the brand it proposes to sell. Moreover, Italian jewelry maker Damiani International would like to put jewelry cards into their plan to help in image enhancement of brand. "The central government has also been working on simplifying the single-brand retail policy, especially on the clause related to 30 percent mandatory sourcing, after it received Swedish furniture retailer IKEA's investment proposal," they said. IKEA and Pavers, a British shoe chain, have applied for 100 percent ownership in single-brand retailing. Ajay Muttreja, President, Technova, which specializes in cross- border market entry strategy, said India was likely to mop up FDI worth 2 to 3 billion US dollars in the multi-brand segment.

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