“Food and food products account for 70 per cent of Grofers sales. This approval would ensure elimination of multiple layers between the farmer and the end customer, ensuring better quality and fresher products at cheaper prices,” Albinder Dhindsa, founder of the company, said.
The firm intends to push in an additional capital of $40 million within the next few weeks into the business.
In June last year, the government had allowed 100 per cent FDI in multi-brand food retail. However, food products have to be produced, processed or manufactured in the country. The move till now had drawn little interest from international retail players who have complained that just having “food-only” stores was not a viable option.
While 51 per cent FDI was allowed in multi-brand retail under the UPA rule, the current NDA government is opposed to it though the rules have not been altered.
The Grofers case becomes the second FDI case to get an in-principle clearance after the Foreign Investment Promotion Board (FIPB) was shut down.
“From an approvals perspective, Grofers is now in a much better position in comparison to horizontal e-commerce players and international retailers, who are only permitted to undertake marketplace/B2B wholesale trade businesses in India,” a Grofers executive said.
have already selected space for stores and worked out the number of employees they would need. “The blueprint for our offline plan is ready; our back-end is in place," a senior executive at an online company planning to open physical stores said.