The Hindu Business Line : Canon to enter Bhutan through Indian arm

Earlier this week, the Indian subsidiary received permission from the Government to expand its distribution network for all its products in Bhutan through appointment of dealers. The company has also been allowed to provide sales and marketing support as well as after-sales services to its dealers in the Himalayan kingdom.

However, the permission granted by the Ministry of Finance is subject to several conditions. "The company has been told that the cost of the expansion activities that the company would undertake in its Bhutan operations should be met either by bringing in additional foreign exchange or by meeting the same out of the net profits earned in India after paying taxes, which otherwise would have been repatriated," sources said.

It has also been specified that the company should not repatriate profits earned in Bhutan from India.

Regarding re-export of Canon products from India to Bhutan, the Ministry has instructed the company that such transactions have to be carried out in freely convertible currency and not the domestic currency.

Canon products include cameras, copiers, scanners, fax, multifunctional copiers, printers, projectors and many similar office items. The company is banking heavily on its digital cameras and is targeting a 30 per cent market share.

The company has also set a target of around 200 per cent topline growth over the next two-three years, largely through increased sales of digital cameras. The company has set a sales turnover of Rs 700 crore by 2007, including the turnover from Bhutan operations, according to company sources.

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