UK’s largest super market chain Tesco could be a step closer to investing in India with its Chief Executive Officer Philip Clarke and Tata International Managing Director Noel Tata scheduled to meet Commerce and Industry Minister Anand Sharma on Friday to discuss the nitti-gritties of the company’s plans.

“There is no formal agenda for the talks. But we believe that Tesco wants to discuss its investment plans in India and also seek clarifications on a number of issues, including local sourcing and back-end investments,” an official from the Department of Industrial Policy and Promotion told Business Line .

Tesco had signed a franchisee agreement with Tata’s retailing arm, Trent Ltd, to use Tesco’s supply chains and infrastructure with the aim of opening Star Bazaar hypermarkets all over the country. It also set up an Indian subsidiary last December to buy fresh and processed foods from the country for its global stores last year. Setting up retail outlets in India is the next logical step for the company.

Although India opened doors for foreign investors in multi-brand retail last year by allowing foreign direct investments (FDI) up to 51 per cent, no formal application has been made yet as major global players, including Walmart and Carrefour, are still examining the policy and its implications.Tesco Chairman Richard Broadbent had met Anand Sharma in Davos in February this year and sought clarification on a number of issues related to the FDI policy. Sharma had said his ministry would provide all the help needed for foreign companies to set up operations and the company should list out the problem areas.

The FDI policy stipulates that foreign investors have to put in half their total investments to develop back-end infrastructure like cold chain facilities and warehouses. Foreign investors will also have to compulsorily source 30 per cent of their inputs from small and medium enterprises.

> amiti.sen@thehindu.co.in

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