Mangalore: The import of cashew kernels by Japan crossed 7,600 tonnes in 2012.
This figure assumes significance to India, as Japan is the fourth major export-destination for Indian cashew.
The US, the UAE and the Netherlands are the top three destinations for the export of cashew kernels from India.
Of the 7,602 tonnes of cashew kernels imported by Japan in 2012, India’s share was 6,099 tonnes.
QUALITY
Walter D’Souza, Chairman of Federation of Indian Export Organisations (Southern Region), told Business Line that quality Indian cashews have a preference in Japan.
Quality always has a cost, and Japan was one of the first countries to have come to terms with reality.
Many of the Indian exporters command a good premium in prices for the supply of quality consistent with high standards Japan expects from the importers, he said.
G. Giridhar Prabhu, Proprietor of the Mangalore-based Achal Industries (who has been exporting to Japan since 1988), said that Japan prefers good quality cashew of Goa, Maharashtra or Karnataka origins.
K. Prakash Rao, owner of Kalbavi Cashews and cashew exporter, said that the consumption of cashew in Japan is growing slowly, but steadily.
Quoting George Ishiguro of the Japan-based Blaxton Corporation, Rao said that there is increase in the programmes featuring the nutritious effects of nuts in the Japanese television channels.
The consumers have become more selective for healthy and tasty food. (Ishiguro is a Japanese trader of cashew nuts and dried fruits).
The fear of radioactive pollution by the 2011 Japanese Tsunami has made the consumers more safety conscious. They are now looking at chemical free and radiation free food, he said.
VIETNAM ROLE
Prabhu said that though Japan has long favoured the Indian quality, Vietnamese have also made inroads into Japan of late.
While India contributed 80 per cent to the cashew kernel imports in Japan during 2012, Vietnam contributed 18 per cent. D’Souza said that even though Vietnam should have a larger share in the imports into Japan, there has been a dilution in the quality of imports from Vietnam into Japan.
“Indian exporters have been consistent in terms of quality and timely performance. Both these factors weighed heavily in favour of India,” he said.
Prakash Rao said that new comers such as Kenya are also making their entry into Japanese market. Japan imported 95 tonnes of cashew kernels from Kenya in 2012.
However, Kenya exported 86 tonnes in the first seven months of 2013 itself. (The total import of cashew kernel into Japan during the first seven months of 2013 stood at 4,966.3 tonnes. Of this, the share of India stood at 4,219.4 tonnes.)
SCOPE FOR FUTURE
D’Souza said that India can certainly cross the 10,000-tonne mark by 2015, if more Indian exporters are able to raise the bar in terms of Japanese specifications, quality, and performance parameters.
Clarifying that Indian exporters are adhering to the internationally accepted specifications, he said Japan has created its own niche markets of quality and grading standards.
These are much above the general specifications followed by other importing countries, he added.
Success in my Habit
Monday, October 14, 2013
Kalpataru Power Transmission bags Rs 620 crore orders
Kalpataru Power Transmission has bagged orders worth Rs 620 crore, the Mumbai-based engineering, procurement and construction company said Thursday.
These orders include a Rs 463 crore order from Tamil Nadu Transmission Corporation for setting up a transmission line.
The company also announced bagging a Rs 94 crore project for setting up a 160 km long liquefied petroleum gas pipeline from HPCL.
"The order pipeline remains strong this year. In the first half we have won orders worth Rs 1,750 crore and expect the momentum to continue in the second half also, as many projects are in the final stage of award," Ranjit Singh, managing director, was quoted as saying in the statement.
Kalpataru Power Transmission is a EPC companies operating in power transmission and distribution, oil and gas pipeline, railways, infrastructure development, civil contracting and warehousing and logistics business. The company is currently executing projects in India,
Africa, Middle East, Australia, North America and Far East.
These orders include a Rs 463 crore order from Tamil Nadu Transmission Corporation for setting up a transmission line.
The company also announced bagging a Rs 94 crore project for setting up a 160 km long liquefied petroleum gas pipeline from HPCL.
"The order pipeline remains strong this year. In the first half we have won orders worth Rs 1,750 crore and expect the momentum to continue in the second half also, as many projects are in the final stage of award," Ranjit Singh, managing director, was quoted as saying in the statement.
Kalpataru Power Transmission is a EPC companies operating in power transmission and distribution, oil and gas pipeline, railways, infrastructure development, civil contracting and warehousing and logistics business. The company is currently executing projects in India,
Africa, Middle East, Australia, North America and Far East.
Costume jewellery clocked 20-30% growth in FY14
Kolkata: Higher gold prices and less awareness among Indians about customs clearance norms have worked in favour of costume jewellers in the country. Costume jewellers say that they have clocked 20-30% growth in the current fiscal with women from affluent households embracing such jewellery for attending weddings and parties in foreign locales.
The spectacular growth in costume jewellery has emerged as a threat to the gold trade, which has not witnessed much growth as yellow metal prices have surged due to a weak rupee, touching Rs 33,000 per 10 gm.
"It is true that costume jewellery is a major threat to us. We are advising jewellers to come up with 14-carat gold items to ward off this threat," said Haresh Soni, chairman, All India Gem & Jewellery Trade Federation (GJF).
Costume jewellers say that their trendy as well as heavylook jewellery is even drawing the attention of the affluent class. Rajesh Chheda, partner of Mumbai's top costume jewellery firm Tip Top Point, said that women from South Bombay (SOBO) have started buying from their shop. "The interest among this class for costume jewellery is on the rise and they are coming to our shop in SOBO. We are expecting good demand from them in the upcoming festive and wedding season," he said.
The firm has another outfit in Borivali. Incidentally, demand for costume jewellery comes more from northern and western India. Bangaloreans — both working women as well as college going girls — now-a-days prefer light weight costume jewellery in keeping with the youth mindset that is completely accessoryconscious, the global fashion trends, the importance of looking 'fashionable' rather than looking 'rich', and the need to 'fit in' with your friends rather than looking 'ostentatious'.
Pointed out Vasundhara Mantri, a professional jewellery designer, that women never hesitate to wear imitation jewellery while attending parties, social events, wedding ceremonies because they have contemporary designs with a classic touch bringing in the best of both worlds.
"Disposable income to buy gold jewellery in Indian households has dried up. So, there is a shift towards costume jewellery," added Mantri. Costume jewellery is largely made of brass, cast iron, nickel, plastic beads and stones, instead of precious metals and gems. It does not have resale value and is available in the range of less costhan Rs 100 and may go as high as Rs 50,000 depending upon the item.
Deepika Sehgal, co-founder of Mumbai-based Miss Flurrty, said that the industry size is expected to touch Rs 15,000 crore by December 2015, according to an Assocham study, up from Rs 8,000 crore in December 2012. Women are now embracing this kind of jewellery for attending ceremonies in foreign locales as well.
"The tough customs norms have forced these women to carry costume jewellery so that they do not face any questioning while travelling back to India," said Chheda. But the GJF chairman feels that since there is very little awareness among people about customs norms, they misunderstand the entire process. "While leaving India, they can get their jewellery checked at the customs and take the authority's letter so that while returning to India they do not face any hassle," he explained.
Hyderabad-based jewellery designer Suhani Pittie said: "While demand from the US and European markets has been on the rise over the last 9-12 months (in volume terms), demand from rural market has also grown substantially over the years. Gold is and will always be an emotional and investment-oriented purchase in our country. But price being such a constraint, imitation jewellery, via its large canvas of raw material, offers various ways to phrase your expression. In fact, the imitation/fashion jewellery market sees a rise of nearly 85% during festivals. It is growing by nearly 20% per annum".
The spectacular growth in costume jewellery has emerged as a threat to the gold trade, which has not witnessed much growth as yellow metal prices have surged due to a weak rupee, touching Rs 33,000 per 10 gm.
"It is true that costume jewellery is a major threat to us. We are advising jewellers to come up with 14-carat gold items to ward off this threat," said Haresh Soni, chairman, All India Gem & Jewellery Trade Federation (GJF).
Costume jewellers say that their trendy as well as heavylook jewellery is even drawing the attention of the affluent class. Rajesh Chheda, partner of Mumbai's top costume jewellery firm Tip Top Point, said that women from South Bombay (SOBO) have started buying from their shop. "The interest among this class for costume jewellery is on the rise and they are coming to our shop in SOBO. We are expecting good demand from them in the upcoming festive and wedding season," he said.
The firm has another outfit in Borivali. Incidentally, demand for costume jewellery comes more from northern and western India. Bangaloreans — both working women as well as college going girls — now-a-days prefer light weight costume jewellery in keeping with the youth mindset that is completely accessoryconscious, the global fashion trends, the importance of looking 'fashionable' rather than looking 'rich', and the need to 'fit in' with your friends rather than looking 'ostentatious'.
Pointed out Vasundhara Mantri, a professional jewellery designer, that women never hesitate to wear imitation jewellery while attending parties, social events, wedding ceremonies because they have contemporary designs with a classic touch bringing in the best of both worlds.
"Disposable income to buy gold jewellery in Indian households has dried up. So, there is a shift towards costume jewellery," added Mantri. Costume jewellery is largely made of brass, cast iron, nickel, plastic beads and stones, instead of precious metals and gems. It does not have resale value and is available in the range of less costhan Rs 100 and may go as high as Rs 50,000 depending upon the item.
Deepika Sehgal, co-founder of Mumbai-based Miss Flurrty, said that the industry size is expected to touch Rs 15,000 crore by December 2015, according to an Assocham study, up from Rs 8,000 crore in December 2012. Women are now embracing this kind of jewellery for attending ceremonies in foreign locales as well.
"The tough customs norms have forced these women to carry costume jewellery so that they do not face any questioning while travelling back to India," said Chheda. But the GJF chairman feels that since there is very little awareness among people about customs norms, they misunderstand the entire process. "While leaving India, they can get their jewellery checked at the customs and take the authority's letter so that while returning to India they do not face any hassle," he explained.
Hyderabad-based jewellery designer Suhani Pittie said: "While demand from the US and European markets has been on the rise over the last 9-12 months (in volume terms), demand from rural market has also grown substantially over the years. Gold is and will always be an emotional and investment-oriented purchase in our country. But price being such a constraint, imitation jewellery, via its large canvas of raw material, offers various ways to phrase your expression. In fact, the imitation/fashion jewellery market sees a rise of nearly 85% during festivals. It is growing by nearly 20% per annum".
Venezuelan oil firm signs agreements with RIL, OVL
PDVSA will supply between 3,00,000 and 4,00,000 barrels per day of heavy crude to Reliance's two refineries in Jamnagar under 15-year contract
New Delhi: In a sign of increasing Indian involvement in Venezuela, the South American country’s state oil company, Petroleos de Venezuela (PdVSA), has signed two agreements with state-run ONGC Videsh Ltd (OVL) and private sector giant Reliance Industries Ltd (RIL).
Mukesh Ambani-led RIL and PdVSA have signed a joint study agreement for Ayacucho block 8 in the Orinoco oil belt of that country. According to the study agreement, both parties will jointly evaluate the development plan of the block. RIL and PdVSA have also extended the term of the memorandum of understanding (MoU) signed between the parties last year by one year for continued cooperation.
Meanwhile, an MoU was signed by D K Sarraf, managing director, OVL, and Ruben iguera, director of new development, PdVSA on Thursday. The pact encompasses strategic cooperation and participation in the exploration and production of hydrocarbon resources in the oil-rich Faja area of Venezuela. This would facilitate OVL and PdVSA to explore available opportunities through joint collaboration and hence, enhance OVL's interest in Venezuela.
Sudhir Vasudeva, chairman, ONGC group of companies, said: “This MoU underlines the spirit of collaboration between two exploration and production giants in India and Venezuela. Venezuela has the world’s largest reserves and we have a huge market. We intend to use this opportunity to further our interests in this oil rich country.” OVL currently has stakes in two producing projects in Venezuela--Petro-Carabobo and Petro-Indovenezolana--with investments of about $341 million.
RIL and PdVSA had signed a 15-year heavy crude oil supply contract and an MoU to develop Venezuelan heavy oil fields last year. According to that, PdVSA will supply between 300,000 and 400,000 barrels a day of Venezuelan heavy crude oil to RIL’s two refineries in Jamnagar under a 15-year contract.
New Delhi: In a sign of increasing Indian involvement in Venezuela, the South American country’s state oil company, Petroleos de Venezuela (PdVSA), has signed two agreements with state-run ONGC Videsh Ltd (OVL) and private sector giant Reliance Industries Ltd (RIL).
Mukesh Ambani-led RIL and PdVSA have signed a joint study agreement for Ayacucho block 8 in the Orinoco oil belt of that country. According to the study agreement, both parties will jointly evaluate the development plan of the block. RIL and PdVSA have also extended the term of the memorandum of understanding (MoU) signed between the parties last year by one year for continued cooperation.
Meanwhile, an MoU was signed by D K Sarraf, managing director, OVL, and Ruben iguera, director of new development, PdVSA on Thursday. The pact encompasses strategic cooperation and participation in the exploration and production of hydrocarbon resources in the oil-rich Faja area of Venezuela. This would facilitate OVL and PdVSA to explore available opportunities through joint collaboration and hence, enhance OVL's interest in Venezuela.
Sudhir Vasudeva, chairman, ONGC group of companies, said: “This MoU underlines the spirit of collaboration between two exploration and production giants in India and Venezuela. Venezuela has the world’s largest reserves and we have a huge market. We intend to use this opportunity to further our interests in this oil rich country.” OVL currently has stakes in two producing projects in Venezuela--Petro-Carabobo and Petro-Indovenezolana--with investments of about $341 million.
RIL and PdVSA had signed a 15-year heavy crude oil supply contract and an MoU to develop Venezuelan heavy oil fields last year. According to that, PdVSA will supply between 300,000 and 400,000 barrels a day of Venezuelan heavy crude oil to RIL’s two refineries in Jamnagar under a 15-year contract.
RBI allows banks to borrow from international and multilateral financial institutions
Central bank sasy such borrowings shall be eligible for concessional swap facility of RBI
Mumbai: The Reserve Bank of India (RBI) has granted permission to banks to borrow from international/multilateral financial institutions for a limited period of up to November 30, said RBI on Thursday.
RBI also said such borrowings should be for the purpose of general banking business and not for capital augmentation.
According to the central bank, such borrowings shall be eligible for the concessional swap facility of RBI.
Earlier, RBI had allowed banks to borrow from their head office of overseas branches or correspondents outside India up to hundred per cent of its unimpaired Tier-I capital or $10 million, whichever is higher.
Mumbai: The Reserve Bank of India (RBI) has granted permission to banks to borrow from international/multilateral financial institutions for a limited period of up to November 30, said RBI on Thursday.
RBI also said such borrowings should be for the purpose of general banking business and not for capital augmentation.
According to the central bank, such borrowings shall be eligible for the concessional swap facility of RBI.
Earlier, RBI had allowed banks to borrow from their head office of overseas branches or correspondents outside India up to hundred per cent of its unimpaired Tier-I capital or $10 million, whichever is higher.
India to strengthen cooperation with ASEAN: PM
New Delhi: In order to increase cooperation with South East Asian countries on economic and security issues, Dr Manmohan Singh, the Prime Minister of India, announced a separate Mission for Association of South East Asian Nations (ASEAN) region to be set up in Jakarta, Indonesia. The mission will be assigned a full-time resident Ambassador.
Dr Manmohan Singh also represented India’s willingness to sign the Free Trade Agreement (FTA) with ASEAN on services and investment by the end of this year and its early implementation, while addressing the 11th ASEAN-India Summit. The agreement will also boost bilateral trade among the regions from US$ 76 billion last year to US$ 100 billion by 2015.
India and ASEAN have established a comprehensive agenda of cooperation and a wide-ranging framework to pursue it over the last two decades.
“Today, we stand on the threshold of the third decade of our engagement. In keeping with our substantial achievements, the recent elevation of our ties to a strategic partnership and the rich potential of our cooperation, I feel it would be appropriate for me to take this opportunity to announce that India will soon set up a separate Mission to the ASEAN in Jakarta with a full-time resident Ambassador,” Dr Singh added.
He further highlighted that all the countries have equal stakes in the security and prosperity of our shared Asian neighbourhood. The scope of India’s engagement with East and Southeast Asia has grown steadily in the last two decades.
“We seek to promote not only mutually beneficial bilateral relations, but also to work institutionally with regional partners and foster a climate that is conducive to stability, security and economic development in our region,” said Dr Singh.
The Prime Minister emphasised that ASEAN has paved the way for a great level of cooperation and integration, not only among themselves, but also in the broader region.
“For India, it is an article of faith of our Look-East policy that ASEAN must remain central to the future evolution of regional mechanisms, which must be open and inclusive. We share your vision and aspirations for the region and we applaud your march towards an ASEAN Economic Community in 2015,” pointed out Dr Singh.
Dr Manmohan Singh also represented India’s willingness to sign the Free Trade Agreement (FTA) with ASEAN on services and investment by the end of this year and its early implementation, while addressing the 11th ASEAN-India Summit. The agreement will also boost bilateral trade among the regions from US$ 76 billion last year to US$ 100 billion by 2015.
India and ASEAN have established a comprehensive agenda of cooperation and a wide-ranging framework to pursue it over the last two decades.
“Today, we stand on the threshold of the third decade of our engagement. In keeping with our substantial achievements, the recent elevation of our ties to a strategic partnership and the rich potential of our cooperation, I feel it would be appropriate for me to take this opportunity to announce that India will soon set up a separate Mission to the ASEAN in Jakarta with a full-time resident Ambassador,” Dr Singh added.
He further highlighted that all the countries have equal stakes in the security and prosperity of our shared Asian neighbourhood. The scope of India’s engagement with East and Southeast Asia has grown steadily in the last two decades.
“We seek to promote not only mutually beneficial bilateral relations, but also to work institutionally with regional partners and foster a climate that is conducive to stability, security and economic development in our region,” said Dr Singh.
The Prime Minister emphasised that ASEAN has paved the way for a great level of cooperation and integration, not only among themselves, but also in the broader region.
“For India, it is an article of faith of our Look-East policy that ASEAN must remain central to the future evolution of regional mechanisms, which must be open and inclusive. We share your vision and aspirations for the region and we applaud your march towards an ASEAN Economic Community in 2015,” pointed out Dr Singh.
Friday, October 11, 2013
JSW Steel acquires Heidelberg Cement's grinding unit at Raigad
Kolkata: JSW SteelBSE 1.61 % has acquired Heidelberg Cement India's 0.6 million tonne per annum (mtpa) cement grinding facility in Raigad, Maharashtra, "as a going concern on slump sale basis." The transaction which was carried out for an undisclosed sum.
The two companies signed the Business Transfer Agreements for the acquisition on October 5, according to filings made by bot Hidelberg and JSW Steel with the BSE on Monday.
"The transaction will be consummated only after obtaining all relevant approvals required under applicable laws," JSW Steel said. However, it did not disclose the value of the deal. The board of the two companies had decided to enter into a deal on May 21, 2013.
JSW Steel had acquired the company through the erstwhile JSW Ispat SteelBSE 0.40 %, which is now its merged associate firm. Announcing the deal, JSW Ispat had then said the acquisition would enable it develop a stable outlet for evacuation of slag.
Heidelberg Cement had termed the deal as part of company's philosophy of "divesting less strategic assets with lower margins", which would enable it to "focus on more strategic and key operations in central India where the company had recently expanded its cement capacity from 2 to 5 million tonne per annum."
The two companies signed the Business Transfer Agreements for the acquisition on October 5, according to filings made by bot Hidelberg and JSW Steel with the BSE on Monday.
"The transaction will be consummated only after obtaining all relevant approvals required under applicable laws," JSW Steel said. However, it did not disclose the value of the deal. The board of the two companies had decided to enter into a deal on May 21, 2013.
JSW Steel had acquired the company through the erstwhile JSW Ispat SteelBSE 0.40 %, which is now its merged associate firm. Announcing the deal, JSW Ispat had then said the acquisition would enable it develop a stable outlet for evacuation of slag.
Heidelberg Cement had termed the deal as part of company's philosophy of "divesting less strategic assets with lower margins", which would enable it to "focus on more strategic and key operations in central India where the company had recently expanded its cement capacity from 2 to 5 million tonne per annum."
Tata Power to set up coal-fired plant in Myanmar
New Delhi: Tata Power has forayed into Myanmar and has begun feasibility studies to set up a coal-fired power station there. The project is expected to be commissioned in 2019-20. This would be the first project by the Tata Group Company in the South-East Asian nation.
“Yes, Tata Power has executed a memorandum of understanding (MoU) with the Government of Myanmar for setting up an imported coal-based power plant,” a senior company official told Business Line.
The Rs 19,399-crore Tata Power is aggressively looking to expand its portfolio overseas. At present, it is building hydro electric projects in Bhutan, Georgia and Zambia. The firm is also developing two wind power projects in South Africa.
In Myanmar, the power plant is proposed to be located in Ngayok Kaung, Ayeyarwaddy region, and would have captive coal berthing arrangements. The Tata Power official did not divulge the capacity of the power station. “The capacity would be finalised based on the feasibility studies. The power plant is estimated to be commissioned in 2019-20,” the official said.
“Yes, Tata Power has executed a memorandum of understanding (MoU) with the Government of Myanmar for setting up an imported coal-based power plant,” a senior company official told Business Line.
The Rs 19,399-crore Tata Power is aggressively looking to expand its portfolio overseas. At present, it is building hydro electric projects in Bhutan, Georgia and Zambia. The firm is also developing two wind power projects in South Africa.
In Myanmar, the power plant is proposed to be located in Ngayok Kaung, Ayeyarwaddy region, and would have captive coal berthing arrangements. The Tata Power official did not divulge the capacity of the power station. “The capacity would be finalised based on the feasibility studies. The power plant is estimated to be commissioned in 2019-20,” the official said.
L & T gets two EPC orders in UAE, Qatar
Mumbai: Larsen & Toubro has secured two engineering, procurement and construction (EPC) projects worth around Rs.1,100 crore in the hydrocarbon segment in UAE and Qatar. The Indian major has also won the contract for the fuel depot expansion of the Abu Dhabi International Airport.
The depot expansion project aims to upgrade the facility to meet the increased demand for jet fuel over the next 20 years. L&T is to take over the EPC of the Abu Dhabi Oil Refining Company refining, which will raise the storage capacity of aviation fuel depot to 80 million litres.
Viral Shah, analyst at Angel Broking noted, ``The project involves EPC work of a new aviation fuel terminal for developing storage and deliver of Jet A-1 fuel at the Abu Dhabi International Airport. The project is awarded by Takreer, a subsidiary of state owned Abu Dhabi National Oil Company, and is expected to be completed in 30 months. In Qatar, L&T has bagged an EPC contract for third party gas interconnecting facilities in Ras Laffan from Dolphin Energy. The project has a construction period of 20 months.''
L&T is already executing another export gas upgrade facilities project for Dolphin Energy to increase the capacity of the export gas compressors facilities by adding three new compression trains.
The depot expansion project aims to upgrade the facility to meet the increased demand for jet fuel over the next 20 years. L&T is to take over the EPC of the Abu Dhabi Oil Refining Company refining, which will raise the storage capacity of aviation fuel depot to 80 million litres.
Viral Shah, analyst at Angel Broking noted, ``The project involves EPC work of a new aviation fuel terminal for developing storage and deliver of Jet A-1 fuel at the Abu Dhabi International Airport. The project is awarded by Takreer, a subsidiary of state owned Abu Dhabi National Oil Company, and is expected to be completed in 30 months. In Qatar, L&T has bagged an EPC contract for third party gas interconnecting facilities in Ras Laffan from Dolphin Energy. The project has a construction period of 20 months.''
L&T is already executing another export gas upgrade facilities project for Dolphin Energy to increase the capacity of the export gas compressors facilities by adding three new compression trains.
H&M’s Rs 700-cr FDI proposal gets DIPP green signal
New Delhi: The Department of Industrial Policy and Promotion (DIPP) is learnt to have given its approval to Hennes & Mauritz AB’s Rs 700-crore investment proposal, almost six months after the Swedish clothing giant made an application to foray into the Indian single-brand retail market.
The Stockholm-headquartered iconic fashion company’s top brass, including chief executive Karl Johan Persson, is believed to have met DIPP officials last week. After that, they might have sent their responses to the department, which had earlier raised certain questions on the application, submitted in April, according to officials in the ministry of commerce and industry.
“All issues sorted. Now it is for FIPB (Foreign Investment Promotion Board) to take it up in its next meeting,” a senior DIPP official told Business Standard.
FIPB, under the chairmanship of Economic Affairs Secretary Arvind Mayaram, is likely to consider the proposal at its meeting on October 18. Once FIPB gives its final approval, H&M will be allowed to open in the country the 50 stores it had proposed to set up.
H&M, famous for its bold prints and fast-fashion clothing, had sent ist application to DIPP in April, after which the latter had raised several questions on whether the company would be able to strictly adhere to the sourcing norms, in line with the FDI policy for single-brand retail.
According to the extant policy, foreign retailers investing more than 51 per cent can open outlets across the country on the condition that 30 per cent of their sourced sales would come from small- to medium-sized domestic enterprises.
DIPP also had concerns on the brand’s licensing agreement between the parent company and its investors. That has now been resolved.
Endorsed by the likes of super-model Gisele Bundchen and footballer David Beckham in international ad campaigns, H&M will invest euro 100 million in the first phase through its wholly-owned subsidiary.
This is second such proposal from Sweden and also the second largest. Earlier this year the Cabinet Committee on Economic Affairs had cleared furniture-maker Ikea’s Rs.10,500 crore proposal again a leading brand from Sweden but registered in Netherlands.
The Stockholm-headquartered iconic fashion company’s top brass, including chief executive Karl Johan Persson, is believed to have met DIPP officials last week. After that, they might have sent their responses to the department, which had earlier raised certain questions on the application, submitted in April, according to officials in the ministry of commerce and industry.
“All issues sorted. Now it is for FIPB (Foreign Investment Promotion Board) to take it up in its next meeting,” a senior DIPP official told Business Standard.
FIPB, under the chairmanship of Economic Affairs Secretary Arvind Mayaram, is likely to consider the proposal at its meeting on October 18. Once FIPB gives its final approval, H&M will be allowed to open in the country the 50 stores it had proposed to set up.
H&M, famous for its bold prints and fast-fashion clothing, had sent ist application to DIPP in April, after which the latter had raised several questions on whether the company would be able to strictly adhere to the sourcing norms, in line with the FDI policy for single-brand retail.
According to the extant policy, foreign retailers investing more than 51 per cent can open outlets across the country on the condition that 30 per cent of their sourced sales would come from small- to medium-sized domestic enterprises.
DIPP also had concerns on the brand’s licensing agreement between the parent company and its investors. That has now been resolved.
Endorsed by the likes of super-model Gisele Bundchen and footballer David Beckham in international ad campaigns, H&M will invest euro 100 million in the first phase through its wholly-owned subsidiary.
This is second such proposal from Sweden and also the second largest. Earlier this year the Cabinet Committee on Economic Affairs had cleared furniture-maker Ikea’s Rs.10,500 crore proposal again a leading brand from Sweden but registered in Netherlands.
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