Modi to meet Uniqlo to discuss on the retailer’s multi-billion dollar India investment plan

Prime Minister Narendra Modi during his international bilateral trip to Japan starting Saturday is expected to meet Uniqlo Chairman Tadashi Yanai to carry forward their discussion on the retailer’s multi-billion dollar India investment plan. The prime minister’s office has been in touch with the textiles ministry for details about the company’s India plans.

Uniqlo Co., Ltd. is a Japanese casual wear designer, manufacturer and retailer. The company has been a wholly owned subsidiary of Fast Retailing Co., Ltd. since November 2005, and is listed in the First Section of the Tokyo Stock Exchange.

In terms of foreign direct investment (FDI) into India, Japan ranks fourth. The visit is also important in a strategic sense as it is a part of a vision to counter China. Modi, who’s visited Japan many times as Gujarat chief minister, will be accompanied by at least 12 top industrialists, including Mukesh Ambani, Gautam Adani, Azim Premji, Sunil Mittal, Chanda Kochhar and Kiran Mazumdar-Shaw. He’s expected to discuss trade, economic, banking and defence issues with the Japanese Prime Minister.

As for Uniqlo, Chairman Yanai had a one-on-one with Modi in June while on a company delegation for meetings with the textile and commerce ministries.

Uniqlo has plans to set up hundreds of single-brand retail stores in India in the long-term, according to people in the know. There’s no cap on foreign direct investment in single-brand retail. Although the Bharatiya Janata Party (BJP) is opposed to foreign investment in multi-brand retail or supermarket chains, it has not shown any resistance to global single-brand stores.

Recently, American chain GAP announced its entry into India through a tie-up with Arvind Brands. Among the other big brands, furniture major IKEA, fashion chain H&M and watch group Swatch are planning to open 100 per cent owned single-brand stores in the country. Brands such as Zara and Marks & Spencer already operate in India through tie-ups with Indian companies.

Though Fast Retailing Co Ltd’s Uniqlo has been exploring opportunities to set up stores in India, it is learnt to have indicated that in the first phase, it would like to set up a sourcing base in India for export to other countries. Uniqlo stores may come in the next phase, though no timeframe is given. According to sources, in the medium- to long-term, the company is looking at “investing heavily” in India.

Uniqlo wanted India to identify the 10 biggest manufacturers with which it could tie up for exports, and about 20 names were given. Among the global brands sourcing from India are Zara, Next, GAP, Marks & Spencer, Ann Taylor, Ralph Lauren, Abercrombie & Fitch. Currently, Uniqlo sources apparel from China, Vietnam, Bangladesh and Indonesia.

Uniqlo in addition to Japan, the company operates in Australia, Bangladesh, China, France, Germany, Hong Kong, Indonesia, Macau, Malaysia, the Philippines, Russia, Singapore, South Korea, Taiwan, Thailand, the United Kingdom, and the United States. It runs 2,000 outlets across the world.