Walmart Wants Slice of Food Retail Pie, if Norms Favourable
India CEO Krish Iyer keen on both brick-&-mortar and online formats
Sagar Malviya & Chaitali Chakravarty
Mumbai | New Delhi: Walmart, the world’s largest retailer, is interested in selling food products directly to Indian consumers both by setting up brick-and-mortar as well as online stores, but it will take a final decision after evaluating the policy guidelines that will be notified by the government, said the head of its India unit.
“The business of brick-andmortar food retail stores and online sale of food products is of interest to us, but we have to evaluate the policy guidelines once they are notified,” Walmart India Chief Executive Krish Iyer told ET in an exclusive interaction. The government announced its intention to allow100% foreign direct investment (FDI) in ‘marketing of food products manufactured and produced in India’ in the
Betting Big On India
is of interest to Walmart, will evaluate policy notification
recent Budget. The final rules will have to be approved by the Union Cabinet before they are notified.
“Never in the Budget has the government taken so much interest in retail, and it is encouraging. 100% FDI in food marketing is a progressive step,” Iyer said.
“We have advised banks to conduct second verification of valuation reports and legal opinions submitted by borrowers which are usually relied upon by banks while sanctioning loans. This task can also be outsourced to another agency. Also, banks can set up their own consultancy divisions. What I want to say is there’s no point running after bank managers once an account has turned into a non-performing asset,” Central Vigilance Commissioner KV Chowdary told ET without making any direct reference to the Mallya case.
It may be recalled that IDBI relied on Kingfisher’s improved credit ratings to sanction a loan of .₹ 950 crore. This rating, the Central Bureau of Investigation later claimed, was inflated and was not an accurate representation of the company’s financial health. Further, the anti-corruption watchdog has asked the banks to come up with guidelines on when they can start selling liquid assets of a borrower there are indications that a loan is moving into the ‘stressed’ category. “At present there are no guidelines by banks at what stage they can encash liquid assets. We feel they must have a clear policy on this,” said Chowdary.
In Kingfisher’s case, banks kept holding on to liquid assets, which were worth little when its share prices plummeted.
He also said banks should define the term ‘due-diligence’ for managers while granting loans. “The term due-diligence is loosely used. From sanctioning a simple overdraft to setting up an atomic power plant, the procedure seems to be the same.”
These objective, according to the CVC, should be to have uniform guidelines for both PSU and private sector banks as this will help identify frequent borrowers who constantly jump banks. “At present, many banks are not aware if a person has taken a loan earlier or not,” added Chowdary.