Flipkart deal good for India, will create millions of jobs: McMillon
MEGA ACQUISITION Walmart CEO sees no trouble in getting regulatory approval NEWDELHI:
Walmart Inc. on Thursday tried to assuage concerns around its $16 billion takeover of Flipkart, saying the deal is good for the country as it will help create millions of jobs over time and help the economy through local sourcing of goods by the company.
Walmart chief executive Doug McMillon played down not being able to meet either Prime Minister Narendra Modi or any senior minister after announcing the world’s biggest e-commerce deal, saying he has had meetings with officials in the past and would have them in future too.
He saw “no trouble” in getting regulatory approval needed from the Competition Commission of India for the deal to buy 77% stake in Flipkart.
“It is pretty clear that this (deal) is good for customers and would create jobs and help society,” he said at a select media roundtable here.
Asked about ‘icy demeanour’ of the government in him not being able to meet the Prime Minister, and commerce minister Suresh Prabhu changing plans at the last moment, he said he did not take the events as cold reception.
“I didn’t really take it that way,” he said. “We deal with the government at all kinds of levels all the time... we have met before and I am sure will meet again.”
Asked specifically if an appointment with the Prime Minister was indeed sought, he said Walmart is not new to the country. “That (meeting) is not the most important thing. We don’t need a photo-op,” he said.
Soon after the deal was announced yesterday, RSS-affiliate Swadeshi Jagran Manch alleged that Walmart was “circumventing” rules for a “backdoor entry” into India and sought the Prime Minister’s intervention to safeguard “national interest”. “This will further eliminate small and medium businesses, small shops, and opportunity to create more jobs. Most of these small entrepreneurs are already battling for their existence; entry of Walmart will further create problems for them,” the co-convenor of the manch, Ashwani Mahajan said in a letter to the Prime Minister.
McMillon, however, said he saw no problems in getting support for the deal. “I haven’t had any concern about support and I think this investment is good for the country and people generally realise that.”
On job creation, he said while it is difficult to put a precise estimate to jobs investment in e-commerce space will create, thirdparty analysis shows that it can generate millions of direct and indirect employment.
“There is an opportunity over a period of years to generate another 10 million jobs. I don’t want to put a timeline but we have analysis to show that,” he said. The jobs would be created not just in the company but with the suppliers who sell their products on the Flipkart platform.
He said Walmart buys more than 90% of goods locally in every country where it runs stores and e-commerce business.
A day after announcing $16 billion investment in India’s largest online retailer Flipkart, Walmart Inc. on Thursday said it will continue to grow its wholesale cash-andcarry business, adding 50 new stores in the next four-five years.
“We currently have 21 stores and plan to open 50 stores in 4 to 5 years. Plans are on track,” Walmart India president and CEO Krish Iyer said at a select media roundtable. Chief Executive Doug McMillon said Flipkart group, in which the US retailer is acquiring 77% stake, would continue to operate as a separate boardmanaged firm with co-founder Binny Bansal as CEO. So far, it had been handicapped by India’s retail policy that does not allow overseas companies to sell directly to consumers.
NEW DELHI: