//India's small shops battle to keep Wal-Mart out

India's small shops battle to keep Wal-Mart out


India's small retailers are fighting a battle of David and Goliath proportions as they attempt to block Wal-Mart's attempts to penetrate the massive market.

The world's largest retailer is attempting to open hundreds of outlets in New Delhi and other cities, but millions of small store owners are uniting to stand up to the giant.

India, a nation of 1.1 billion whose economy is still very much based on small traders, is one of the last to resist the global retail invasion — a wave that has brought Wal-Mart to India's doorstep.

New Delhi's Fair Deal hardware store is at the centre of the battle to protect millions of family businesses.

"We will definitely do our level best to see that companies like Wal-Mart do not enter the India trading arena," said Praveen Khandelwal of the Confederation of all India Traders.

It may be a losing battle. Though Wal-Mart hasn't yet won its bid to set up shop, the suburban shopping mall has begun to change the face of retail in India.

New Delhi now has two malls.

"Indians are traveling more, they're being exposed to the best of other countries and they want a similar kind of environment here," said Neelam Raivice of MGF Developments Ltd.   

India's retail industry is worth about US$300 billion a year and has attracted the interest of international retailers such as Metro, Carrefour and Tesco.

By 2015, the industry is expected to be worth US$637 billion.

Despite a changing international outlook, Indian business owners and employees remain worried the mega-retailer will have an adverse effect on their economy by jeopardizing the livelihood of the nearly 40 million people who depend on the small business sector.

A visit to Mumbai in late February by Wal-Mart's vice chairman Michael Duke sparked numerous protests.

Demonstrators burned an effigy representing Wal-Mart near the office of Kamal Nath, the Indian commerce and trade minister.  Numerous arrests were made.

Indian law currently allows foreign multi-brand retailers to run only cash-and-carry or franchise businesses.

Wal-mart and India's Bharti group are planning a joint venture in the country. Bharti would have sole ownership of the stores while the U.S. giant would have control over back-end logistics such as supply chain management.

If plans are approved, the first Bharti Wal-Mart store could open as soon as 2008.

With a report from CTV's Paul Workman