Weeks before Wal-Mart Stores Inc. is expected to ink a joint venture with Bharti Enterprises Ltd, a motley group of lawmakers, farmers, small retailers, environmentalists and global anti-Wal-Mart campaigners are forming an alliance to try and stall the US retailer’s entry to India.
A day-long convention on Sunday will bring together politicians from the Left parties, US-based anti-Wal-Mart activist Wade Rathke, Narmada Bachao Andolan’s Medha Patkar and environmental activist Vandana Shiva.
“We are focusing on Wal-Mart and we are outright opposing Wal-Mart’s entry into India in whatever form, either as a retailer or as a wholesaler,” said Dharmendra Kumar, of India FDI Watch, a group that says it opposes overseas investment into the country’s retail sector and is the organizer of the event. The same group organized minor demonstrations when Wal-Mart’s vice-chairman Michael Duke visited the capital in February.
India FDI Watch officials say they intend to form an alliance of different groups to campaign across India, including seeking nationwide strikes against Bentonville, Arkansas-based retailer.
For its part, Wal-Mart points out that it employs 17 lakh people, including four lakh outside the US, and that its average hourly wages in the US for a full-time worker are more than double that country’s minimum federal wages.
“We presently source goods worth over $600 million directly from suppliers in India,” said Raj Jain, president of emerging markets for the company, in an email response. “Many of these suppliers have grown and developed with Wal-Mart over the years.”
In November, Wal-Mart entered into a memorandum of understanding with Bharti, which owns the country’s largest wireless phone network, Airtel, to “jointly explore business opportunities” in India’s $9 billion annual modern retailing market. This market is expected to go up to $43 billion by 2010 and would swell to $114 billion by 2015, according to a study by consulting firm McKinsey & Co.
Since current Indian regulations bar foreign retailers such as Wal-Mart from selling products directly to consumers, Bharti will operate the retail stores and the American giant will manage the supply-chain and logistics side of the business. Also, Wal-Mart plans to form a joint venture with Bharti in a cash-and-carry format, or sell wholesale to other retailers and businesses, an area where India allows 100% foreign ownership.