New Delhi, Aug 7 - Sourcing of products from India by Wal-Mart Stores Inc. could rise to billions of dollars annually in coming years once the U.S. retailer starts operations there, the firm's country president said on Tuesday.
Wal-Mart and India's Bharti Enterprises announced an equal joint venture on Monday for cash-and-carry, or wholesale, and back-end supply chain management. The tie up is scheduled to open its first store in north India by the end of 2008.
"Today Wal-Mart is sourcing over $600 million of products from India directly ... in very few items, limited to textiles, footwear and jewellery," country president for Wal-Mart's India operations Raj Jain told Reuters in an interview.
"My own view is over a period of time this will not grow in 10-15 or 20 percent but probably grow in multiples of 3 or 4 or 5 (times) once we have a good relationship and understanding of the supply business."
India's retail industry, valued at nearly $350 billion, is forecast to double in size by 2015, with modern retail's share of that also quickly increasing from about 3 percent now.
But multiple-brand retailers like Wal-Mart are limited to wholesale and franchise deals. Single-brand foreign retailers can take up to 51 percent in a joint venture with a local firm.
Jain said Wal-Mart is keen to enter the retail sector once foreign investment is permitted.
"Are we interested in getting into retailing when the law permits? Absolutely."