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Starbucks to spell out India plans soon

Starbucks to spell out India plans soon

Author | Source: The Economic Times | Monday, Feb 20,2006 8:26 AM

Starbucks to spell out India plans soon

Starbucks, world's leading fine coffee-cafe chain, which has around 10,000 stores all over the globe, is expected to announce its India foray plans within the next few weeks.

According to the industry sources, the entry is expected to be in collaboration with leading real-estate entity Rahejas. Starbucks is expected to get its beans processed at the facility of a leading coffee-plantation company. However, Starbucks has been tight-lipped about its India plans.

When asked about Starbucks' entry into India, Union minister of state for commerce Jairam Ramesh said that he had been informed that it would be in collaboration with “a big name in real estate'. He hoped that all sections of the plantation industry welcome Starbucks' entry as it would result in as a growth in domestic consumption which had remained largely stagnant and confined to Tamil Nadu despite the success of chains like Cafe Coffee Day and Barista. The minister said that the spiralling costs of land in Bangalore, Mumbai, Delhi, Chennai, Kolkata and Hyderabad might have acted as constraint for starbuks rather than the limited FDI allowed in the retail sector. The tie-up with 'a big name in real estate' could, he added, facilitate the entry of Starbucks into India.

Some 16 months ago, Starbucks had signed contracts with an Indian exporter and a leading plantation company for sourcing beans from India for its global operations.With India's per capita coffee consumption of 54gm being mainly due to the southern region's per capita level of 240gm, the entry of Starbucks could, says retailing expert Harish Bijoor, give a much-needed fillip to consumption in the rest of India, which remains at a mere 3.5gm or one cup of coffee a year.

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