Luxury tax introductions on tablets and smartphones will shift part of the telecommunications supply chain to India
Op-Ed Commentary: Chris Devonshire-Ellis
Jul. 24 – In light of the Indian government’s recent announcements that import duties on luxury items are to be introduced – covering high-end smartphones and tablets – manufacturing polices aimed at targeting the domestic Indian consumer are quickly changing.
Luxury tax surcharges on imported smartphones and tablets costing more than the equivalent of US$37 are to be introduced – raising the duty payable from 1 percent to 6 percent. Samsung has immediately commented, saying the move “won’t have a positive impact” on India’s mobile phone industry, and will force customers to pay more. But then again, Samsung would say that as it will mean investing millions into their existing production facility at Noida, which currently handles only small volumes. Apple meanwhile, has not commented on the new luxury tax, and they have no production facilities in India at all. They have not invested in the country save their own retail outlets. Continue reading
By Ian Bhullar
Jun. 28 – A spurt of high-profile foreign investment into India is raising hopes for the enhancement of investor confidence and the recovery of the country’s FDI inflows. Three events in the past week – IKEA’s proposed entry, and expansion plans by Tommy Hilfiger and Coca Cola – indicate that growth in India’s consumer demand is still perceived as dependable, improving the outlook after a 41 percent drop in India’s FDI inflows in April. Continue reading
May 28 – India has been in discussions with the European Union for some four years concerning duties on imports of wine, currently some of the highest in the world. However the price of imported wines in India could soon be cut dramatically, with a rise in Indian domestic consumption in the cards for suppliers. In a tit-for-tat deal, allowing the European Union vastly improved access to Indian markets will also see doors open for Indian products to Europe – with a massive boost in trade prospects expected on both ends. Continue reading
Apr. 13 – As the large multinational multi-brand retail giants such as Walmart, Carrefour and Tesco wait patiently for a relaxation of Indian investment laws into the sector, Walmart is potentially stealing a lead by exploring possibilities of getting into the same market, but online. The company, looking over its shoulder at the success of Amazon, is keen to develop its own brand into online retailing and has been hiring market specialists in India to look at the feasibility of the business model. Continue reading
Obstacles remain over precise definitions over sourcing clauses in single brand retail
Op-Ed Commentary: Chris Devonshire-Ellis
Apr. 10 – Apple and Ikea are another pair of huge global brands that wish to enter the India market in the advent of the liberalization of single brand retail. Both, however, are facing difficulties in overcoming clarifications concerning the souring clauses inserted into the SBR FDI route.
This clause, seen below, is causing headaches as there is no definition of what constitutes or qualifies as “small industries/village and cottage industries, artisans and craftsmen.”
“In respect of proposals involving FDI beyond 51 percent, mandatory sourcing of at least 30 percent of the value of products sold would have to be done from Indian small industries/village and cottage industries, artisans and craftsmen.” Continue reading
New opportunities and developments lie in store for foreign retailers
By Chris Devonshire-Ellis and Ankit Shrivastava, Dezan Shira & Associates
Feb. 2 – As India has liberalized its single brand retail industry to permit 100 percent foreign investment, we take a look at the regulatory issues and legal structures pertinent to establishing operations in this new dynamic market. That India should be well on the radar for foreign retailers was recently supported by A.T. Kearney, whose 2011 Global Retail Development Index ranks the nation as fourth globally.
India’s retail industry is estimated to be worth approximately US$411.28 billion and is still growing, expected to reach US$804.06 billion in 2015. As part of the economic liberalization process set in place by the Industrial Policy of 1991, the Indian government has opened the retail sector to FDI slowly through a series of steps: Continue reading
Posted in Business, FDI and Foreign Trade, Featured, Legal and Regulatory, Markets, Retail
Tagged Adidas, Carrefour, India Cold Storage, India Consumers, India FDI, India Multi-brand Retail, India Retail, India Single-brand Retail, India Supply Chains, Nike, Walmart
Jan. 11 – The Indian government on Tuesday agreed to allow 100 percent foreign ownership in single brand retail stores, paving the way for international businesses such as Starbucks, Ikea and Adidas to operate independently in the country without having to involve local partners. Foreign single brand retailers were previously limited to 51 percent ownership.
Besides the entrance of new companies into the Indian market, the decision is also likely to result in several existing foreign players operating under tie-ups with Indian companies to convert their existing ventures into wholly-owned subsidiaries. Continue reading
Mar. 31 – Indian businesses have been busy recently signing new cooperations with foreign companies across the world. Here we provide a summary of some of the most important deals Indian companies have signed across several industries.
Ashok Leyland and Nissan unveil first LCV
India’s second largest heavy commercial vehicle manufacturer Ashok Leyland rolled out its first light commercial vehicle (LCV) Dost together with its partner, the Japan-headquartered automaker Nissan. As the current joint venture between the two companies covers cooperation in manufacturing, technology and power train for LCV production, in the future the two parties will likely expand their JV to include van design and development. Continue reading