Business | Economy

Red tape in India is ‘nightmare’, says British retailer

Delivery times, transport problems and labelling changes among Pavers' complaints

  • AFP
  • Published: 15:33 December 7, 2012
  • Gulf News

  • Image Credit: AP
  • A Bharti-Wal-Mart store on the outskirts of Chandigarh. British shoemaker Pavers, one of the first retailers to be allowed to operate in India under new rules, has criticised the bureaucracy.

New Delhi: Leading British shoemaker Pavers, one of the first retailers to be allowed to operate in India under new 100 per cent foreign ownership rules, has attacked the nation’s infamous red tape.

In an interview with India’s Mint newspaper, published on Friday, Stuart Pavers, president of the family-owned firm, said: “Regulations are a nightmare for every retailer, whether from outside India or the domestic retailer.”

The criticism comes after India’s recent introduction of a string of reforms to further open the economy to vital foreign investment and entice overseas businesses to set up shop.

In Britain the firm can deliver fresh stock nightly to each store, said the Pavers chief, but in India “it takes five to 10 days to deliver from the warehouse to the store” due to taxation and suffocating paperwork.

Moving stock is also a problem, Pavers said. While the process takes two to three days in Britain, in India shipments take up to two weeks and involve “20 pieces of paper and three different taxes to be paid”, he said.

India has long been criticised as one Asia’s most inefficient bureaucracies, with its byzantine regulations and widespread corruption seen as a major deterrent to foreign investment.

“What we are looking for in future is a lot of deregulation to make it easy to transport the goods from one place — reduce the taxation and paperwork,” said Pavers, who added that labelling rules “keep changing”.

Pavers, which in October won formal approval from the Foreign Investment Promotion Board to run 100 per cent owned stores, has been in India for five years through franchises and partners and has 142 shops.

The clearance came after India allowed, at the start of 2012, retail operations selling one brand, such as Pavers, to be 100 per cent foreign-owned rather than having to operate with a local partner as part of its reforms.

In another move, the government has allowed foreign supermarket chains such as Walmart to set up shop, causing huge political controversy amid claims the big retailers will swamp India’s small family-run stores.

Comments (2)

  1. Added 14:07 December 8, 2012

    very true. The taxations, the inept bureaucracy, the long delays in customs clearances, corruption at every level makes India as one of the worst countries for investments. Wonder how the MNCs think India is a superpower in the making

    jeyanth, bangalore, India

  2. Added 10:42 December 8, 2012

    the whole system is bad, especially the selection of IAS, IPS and IT department staff........ they got tunnel mind approach, .... their knowledge is limited... further bribery is part of system........

    Zia, dxb, United Arab Emirates

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