News: Bharti vows to go ahead with Wal-Mart tie-up

(DNA 24/02/2007) New Delhi - On a day when it became clear that the Centre has asked for a comprehensive study of the impact of multinational retailers on mom & pop stores, Bharti Enterprises chairman Sunil Mittal appeared unperturbed. Maintaining that the proposed JV with US giant Wal-Mart would be signed in a matter of weeks, Mittal said: "We will proceed with our plans unless the government specifically asks us to stop." He said the development (letter by PMO) would not affect the tie-up with Wal-Mart as the foreign partner was entering only in the cash & carry wholesale operations, not in the consumer-facing front end. But retail industry experts say that with renewed uncertainty over retail policy, including foreign direct investment (FDI) norms, Wal-Mart may well decide to wait for a while till some clarity emerges on the overall policy front. And even the other big names in retail - Carrefour, Tesco, etc - may want to put their India debut plans on hold till the policy environment is more stable. Meanwhile, Wal-Mart vice-chairman Michael Duke was doing the rounds of the capital's corridors of power on the second day of his India sojourn - among others, he met Montek Singh Ahluwalia, deputy chairman of the Planning Commission, Sharad Pawar, agriculture minister and Kamal Nath, commerce and industry minister. To a question on the relationship between Bharti and Wal-Mart, Mittal said: "The cash-and-carry business by Wal-Mart will have an arms-length relationship with Bharti Retail." It remains to be seen what kind of investments Wal-Mart plans to make in the Indian wholesale cash & carry business and whether it agrees to supply critical technology to the Indian partner for a successful retail venture. From available indications, the upcoming board meeting of Wal-Mart next month is expected to consider the terms of the proposed JV with Bharti.