Why Walmart is Taking the E-commerce Route to India

WalmartIf a new report is to be believed, Walmart, which put its plans for India on hold, is planning to enter the country’s $450 bn retail market by setting up an e-commerce marketplace.

A team of over 15 people under Arvind Mediratta, the Chief Operating Officer of Walmart India, is developing the platform which is likely to go live in the coming 3-4 months, the Economic Times reported.

Retailing giant Walmart will be playing catch-up with its online rivals Amazon and eBay, who have already entered the market.

Why e-commerce?

Although India allowed foreign direct investment in multi-brand retail, foreign retailers aren’t too happy with the sourcing norms it set. India’s foreign direct investment policy on multi-brand retail requires foreign companies to locally source at least 30% of the goods they sell. Walmart wanted these norms to be reduced to 15% but India has been firm on its part.

Moreover, FDI is not allowed in e-commerce in India. Which means that the retailer is left with no choice but to build an online marketplace where it lets Indian sellers do business with the consumer.

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