Walmart Increasing Exports from India to Diversify Supply Chain and Decrease Dependency on China
- ByStartupStory | November 30, 2023
Global retail giant Walmart, the parent company of Flipkart and PhonePe, is increasing its exports from India in a strategic move to reduce reliance on China and diversify its supply chain. According to data from Import Yeti, Walmart’s imports in the US from India surged to approximately 25% between January and August this year, a substantial increase from the 2% recorded in 2018. Despite China still representing 60% of Walmart’s imports during this period, there has been a notable decrease from the 80% reported in 2018.
Andrea Albright, Walmart’s Executive Vice President of Sourcing, emphasized the need for resilient supply chains, stating, “We want the best prices. That means I need resiliency in our supply chains. I can’t be reliant on any one supplier or geography for my product because we’re constantly managing things from hurricanes and earthquakes to shortages in raw materials.”
Walmart clarified that the increased imports from India don’t necessarily indicate a reduction in reliance on any specific country as a sourcing market. The company expressed an active commitment to enhancing manufacturing capacity, with India playing a crucial role in this endeavor.
The retail giant is diversifying its exported goods from India, including toys, electronics, bicycles, and pharmaceuticals to the United States. Walmart, having initiated its sourcing from India in 2002, currently employs 100,000 people in the country, covering various units such as Walmart Global Tech India, Flipkart Group, PhonePe, and sourcing operations.
Earlier this year, Walmart’s CEO, Doug McMillon, shared the company’s goals for India, stating a commitment to importing goods worth $10 billion annually from the country by 2027. He emphasized building partnerships with Indian suppliers, including small and medium enterprises.
Walmart solidified its presence in India in 2018 with the acquisition of a 77% stake in the major e-commerce platform Flipkart for $16 billion. Additionally, the retail giant invested $3.5 billion in the first six months of 2023 to acquire Flipkart shares from non-controlling stakeholders, such as Tiger Global and Accel.
While Walmart is intensifying its focus on Indian exports, its rival Amazon claims to have facilitated exports totaling $8 billion from India, with plans to increase this figure to $20 billion. The competition between these retail giants underscores the significance of the Indian market in the global supply chain landscape.
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