NEW DELHI: Walmart CEO Doug McMillon has reached out to PM Narendra Modi on matters of data privacy and localisation, sourcing commitments and issues concerning clearances for its retail business in India.
McMillon, who met Modi during his visit to New York recently, emphasised the need of a stable and open regulatory environment in India to enable Walmart and its group companies to source more from Indian farmers and small suppliers and add to the more than 1 lakh direct jobs it supports in the country, government sources told TOI.
“Within a few years, we will be sourcing at least 25% of our fruits and vegetables directly from farmers, benefiting thousands of farmer families in Uttar Pradesh, Andhra Pradesh and Telangana. As discussed, we see significant opportunities to grow sourcing from Indian companies to sell in India and for export to our global supply chain. Over 95% of what we sell in our Best Price stores in India is sourced locally,” said McMillon.
The letter from the global chief of the US retailer, which clocked over $500 billion in revenue last year, comes at a time when e-commerce giants are facing increased scrutiny in India for allegedly operating an inventory-led business, which is prohibited under existing FDI in e-commerce rules.
Both Amazon and Flipkart have denied the allegations.
Flipkart, which will enter food retail through a newly registered entity Flipkart FarmerMart, will invest $250 million for the online-only foray, Government sources said, adding that this will be an inventory-based model, which is allowed under Indian rules on food retail.
McMillon urged the government to reduce the number of permits required to open a store in India, pointing out the steps the government has taken to reduce licensing norms for hotels. “On an average, we currently need more than 45 permits and three years to open a new Best Price store. This is significantly longer than it takes in the US and many markets in which we operate. If you decide to take a “single window” approach for hotels, we would be excited to engage in that discussion for retail, too,” he said.
Officials said, McMillon also acknowledged the government’s concerns about data privacy for Indian citizens.