Walmart commits to sourcing $10 bn of India-Made goods each year by 2027

Doug McMillon, CEO and president, Walmart
Walmart commits to sourcing $10 bn of India-Made goods each year by 2027

To accelerate its India exports, Walmart will strengthen the development of the supply chain ecosystem in India

 

Peerzada Abrar

Bengaluru, 11 December

 

Seven years after splitting with its joint venture partner Bharti Enterprises over regulatory hurdles such as mandatory sourcing norms from India, Bentonville-based major Walmart has outlined an ambitious target to export goods from the country. The US retail giant said on Thursday it would triple its exports of goods from India to $10 billion annually by 2027 as the country was fast emerging as a global manufacturing hub. It currently sources about $3 billion worth of goods from India.

 

“As an international retailer that brings value to customers and communities worldwide, Walmart understands that local entrepreneurs and manufacturers are vital to the success of the global retail sector. And we see huge potential for Indian suppliers to grow their businesses by leveraging the unique scale and global distribution opportunity Walmart provides,” said Doug McMillon, president and chief executive officer of Walmart Inc.

 

“By significantly accelerating our annual India exports in the coming years, we are supporting the ‘Make in India’ initiative and helping more local businesses reach international customers while creating jobs and prosperity at home in India. It is also a way for Walmart to bring more high-quality, India-made goods to millions of customers all across the world,” he said.

 

The American retail major, which acquired a majority stake in Bengaluru-based e-commerce firm Flipkart in 2018, also operates a wholesale business in India. It had entered the country more than a decade ago with the ambition of setting up big box retail stores like in the US, but policy regulations stopped it from doing so.

 

 Mandatory 30 per cent sourcing from India was among the regulatory hurdles in the multi-brand retail policy.

However, Walmart has now changed its course, working closely with small and medium enterprises as well as with kiranas or mom and pop stores.

The group’s expansion in sourcing will include help in developing hundreds of new suppliers in categories such as food, pharmaceuticals, consumables, health and wellness, and general merchandise.

 

Walmart is competing with US rival Jeff Bezos-led Amazon and Mukesh Ambani-owned Reliance’s JioMart for dominance in India’s online retail market through Flipkart. In July, Walmart led a $1.2-billion investment in Flipkart, valuing the e-commerce firm at $24.9 billion. The same month, Flipkart strengthened its wholesale presence with the acquisition of Walmart India, which operates the Best Price cash-and-carry business.

 

“Flipkart is proud to work with thousands of great Indian brands, MSMEs and artisans, with a focus on making them successful,” said Kalyan Krishnamurthy, chief executive officer of Flipkart Group. “We provide a platform that allows them to reach the pan-India market and refine their all-important branding, marketing, logistics and compliance capabilities for the global market, too. We applaud Walmart for investing to help Indian companies take ‘Make in India’ products global.”

 

Rival company Amazon, which unveiled its Global Selling Programme in India in 2015, is expecting to generate $10 billion in cumulative export sales by 2025 for Indian exporters enrolled in this programme. Besides that, early this year Amazon revealed plans for digitising 10 million MSMEs and creating 1 million jobs by 2025.

 

To accelerate its India exports, Walmart will strengthen the development of the supply chain ecosystem in India. This would be through boosting existing exporters and by expanding the nation’s pool of export-ready businesses.

 

Walmart said it had sourced goods from India for more than 20 years, supporting local suppliers to help upgrade their operations and meet international standards. It has also developed new product lines and build new capabilities in packaging, marketing and supply chain management. Walmart brings global market intelligence and demand forecasts that help suppliers with strategic planning. This support has contributed to the global success of hundreds of companies, including Welspun, LT Foods and Aniket Metals, plus fast-growing export businesses like Global Green Company, it said.

 

Highlights:

Walmart will triple its exports of goods from India to $10 billion each year by 2027.

This would help develop hundreds of new suppliers in categories such as food, pharmaceuticals, consumables, health and wellness. 

India is already one of Walmart’s top sourcing markets, with annual exports worth about $3 billion.



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