By Anant Vijay Kala
MUMBAI--British supermarket chains Tesco PLC (TSCO.LN) and
Sainsbury have applied to Indian authorities to open sourcing
centers in the country, Trade Minister Anand Sharma said
Wednesday.
The applications were made during U.K. Prime Minsiter David
Cameron's visit to India, Mr. Sharma told reporters on the
sidelines of a conference. Mr. Cameron's visit is due to end
Wednesday.
Tesco currently has an agreement in India to provide know-how
about retail operations to Tata Group's Star Bazaar stores.
In September, India allowed foreigners to own up to 51% in its
supermarkets, which sell multiple brands, opening the door to
retailers such as Wal-Mart Stores Inc. (WMT). Previously, foreign
companies could operate only wholesale businesses in the multibrand
segment.
Such investments would be allowed on the condition that 30% of
the inputs in case of multi-brand retail must be sourced from small
and medium-sized local industries.
Mr. Sharma didn't give details of what kinds of products the two
companies plan to source in India or the markets where they could
be used.
He also said that India's merchandise exports would reach $300
billion-$305 billion this fiscal year ending March 31, falling far
short of the $360 billion target the government had set out to
achieve.
Data last week showed India's April-January exports totaled
$239.7 billion.
January's data also showed exports during the month grew for the
first time in nine months--by 0.8% to $25.5 billion--raising hopes
that demand for Indian shipments could begin to revive in the
coming months as economic conditions in the key U.S. and European
markets show some signs of stabilizing.
Mr. Sharma said he is hopeful that February and March data will
be positive, but didn't elaborate.
He also said that the government is concerned about the
country's large trade deficit with China, its largest trading
partner, and that Indian authorities have taken up the matter with
Chinese officials.
India is looking to increase its software and pharmaceutical
exports to its northern neighbor, he added.
Data from India's commerce ministry show Indian exports to China
stood at about $18 billion in the last fiscal year ended March
2012. However, its imports were more than three times higher at
about $57 billion, leading to the wide deficit.
Write to Anant Vijay Kala at anant.kala@dowjones.com