IndiaRetailBiz

Given current political uncertainty as regards FDI in retail, particulary on front-end, multibrand retail, Carrefour- the France-based, second biggest retailer of the world, according to an Economic Times report, has called off its plans of foraying into India, until some clarity on policy for FDI in retail from transnationals emerges.

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

Carrefour, as may be recalled, since a long time, has been discussing possible alliances with domestic players for its entry into the second most populous, as well as the fastest growing, retail market of the world.

Carrefour was initially exploring possibilities of business tie-up for India with the Dubai-based Landmark Group. The discussions, however, were called off with mutual consent. Later, it began talking with leading business houses like Anil Ambani owned ADAG and HDFC, although Nusli Wadia owned Bombay Dyeing Group, it appears had the edge over others. Bombay Dyeing, while sitting pretty on prime textile mill land in Central Mumbai, also has ownership interests in the FMCG food major Britannia and low-fare aviation start-up Go Air.

In fact, a few weeks ago, there were strong suggestions in international media, although denied by the company, about the Mukesh Ambani owned Reliance Group closing on a deal to buy the 13% equity stake owned by Halley family in the equity of Carrefour. There were also talks of Reliance picking up an interest in the equity of one of its logistics and supply chain subsidiaries.

It now appears certain that before taking a final call, Carrefour will watch final structuring and roll out of the Bharti-Wal-Mart deal, as well as, wait for the outcome of the ICRIER report on impact of BIG retail on the unorganised sector. This report, it may be recalled, was ordered by the Deptt. of Industrial Promotion and Policy (DIPP) of the Commerce Ministry of the Govt of India on directive of the Prime Minister’s Office (PMO), which in turn was prompted by a missive from Sonia Gandhi, Chairperson of the ruling UPA, who had earlier requested the Prime Minister to conduct a study before finalising the government’s policy on FDI, so as to ensure that the livelihood security of small operators in the retail sector was not endangered.