Walmart Shifts To India, Cuts China Imports, Allocates $1.2m For Rural India
Walmart, the retail giant from the US, is changing its game plan. It’s looking at India more and more for its goods, and less at China. Why? To save costs and mix up its supply sources. The company is focusing on diversifying its investments to manage risks.
Between January and August this year, Walmart got 25% of its US imports from India. That’s a huge jump from just 2% in 2018. Meanwhile, its imports from China have dropped from 80% to 60% in the same period. China is still a major source, but India is catching up fast.
The reason behind this shift? It’s costlier to bring stuff in from China now, plus there’s some political tension between the US and China. So, big companies like Walmart are looking at India, Thailand, and Vietnam as alternatives.
In the US, shoppers are feeling the pinch of higher interest rates and food prices, so companies like Walmart are getting cautious about how much people will spend. Andrea Albright, Walmart’s big boss of sourcing, says they need to be ready for anything – from natural disasters to raw material shortages. That’s why they’re not putting all their eggs in one basket.
Walmart has been focusing on India for a while. They bought a massive stake in Flipkart back in 2018 and plan to import $10 billion worth of goods from India annually by 2027. Right now, they’re importing around $3 billion a year.
India’s looking good for large-scale, low-cost manufacturing, thanks to its growing workforce, tech advancements, and massive support from the central government. It’s a contrast to China, where the population is actually decreasing, and the country is suffering from multiple challenges.
Walmart’s got over 100,000 people working for them in India across different offices, including their tech unit, Flipkart, PhonePe, and sourcing operations. This May, Walmart’s CEO, Doug McMillon, met PM Narendra Modi, and it seems like they’re excited about India’s potential as an investment hub.
Apart from this, the Walmart Foundation just announced a $1.2 million grant to help 15,000 women farmers in Uttar Pradesh. This money will go towards creating farmer organizations and training women in climate-resilient farming practices. It will help the people from rural areas to income and make farming more sustainable. So, Walmart’s banking is big in India and looking to make a positive impact.