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Bigger Modi mandate may be best for biz: Walmart

Walmart’s EVP and international CFO Richard Mayfield said one can expect the unexpected going forward.

Jun 12, 2019, 10.59 AM IST
(This story originally appeared in on Jun 12, 2019)
Bengaluru: The Narendra Modi government with a bigger majority is probably the best outcome for business, but time will tell, Walmart’s EVP and international CFO Richard Mayfield said in a Deutsche Bank conference on Tuesday.

Answering queries on the regulatory environment after its Flipkart investment in India, Mayfield said one can expect the unexpected going forward, but its existence in India for 10 years has made the company “used to the political and economic environment”.

His comments come after the Indian government implemented stricter FDI laws for e-commerce companies in India, which largely did not please foreign e-tailers. The government is now working on a draft bill for domestic e-commerce policy.

“The e-commerce network is largely ourselves, Amazon, and then some smaller players. So, we feel well positioned. I’m sure there would be a few more surprises. But we know the environment reasonably well and we are confident about the future,” he added.

While FDI policy changes affected Amazon and Walmart’s operations in the short term at least, homegrown Reliance Industries has also announced plans to enter the local e-commerce market. Industry executives and analysts feel this could cause a significant disruption in the market, estimated to be $27 billion at the end of 2018, according to Forrester Research. Flipkart’s payments arm PhonePe found multiple mentions from Mayfield, who said it would be critical for the India market and that the regulatory environment is pushing for adoption with the company in this instance. Mayfield said he feels a China-like situation could play out in India where consumers are moving to digital payments from cash.

“I think the same thing (China) is happening in India for similar reasons, I mentioned the smartphone penetration. The Indian government is making sure that every Indian has a bank account, the cell phone, and the biometric ID. So, they want to link those things together,” he added.

TOI reported last month that PhonePe is seeking a valuation of at least $7-8 billion as it talks with investors like Tencent and Tiger Global to raise around $1 billion.

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