The Indian state of West Bengal has granted a renewed operating licence to retailer Metro, but the German company will still be limited to cash-and-carry wholesale operations as Indian officials seek to protect local businesses, according to Reuters.
The US$350bn Indian retail market presents a juicy prospect for many international groups, but the country’s lawmakers have not made it easy for the world’s retail giants to get a foot in the door.
Metro’s condition-hemmed licence is another indication of India wants to keep the bulk of the retail market for local players.
The All India Forward Bloc, which holds the agriculture and agriculture marketing portfolios in West Bengal’s communist government, imposed conditions on the licence that prevent Metro from contract farming or direct retail.
The Bloc said the conditions are needed to protect local farmers and businesses. “We see this as our victory,” said Naren Chatterjee, a Bloc leader at the head of the agriculture marketing board.
“They got a new licence, but on conditions that deny them entry in retail and contract farming.”
The company, which already runs four wholesale stores in India, plans to invest US$120m in four new cash-and-carry centres in West Bengal. Metro said it was happy to work within the state’s limitations.
“We are keen to start our operations in Kolkata,” said the head of Metro Cash & Carry India Martin Dlouhy. He said the first new outlet was expected to be operation in the next six to eight weeks.
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