Oct 16 (Reuters) - Deutsche Post DHL's Indian arm
plans to invest 100 million euros ($129.4 million) via its
supply chain division to build new warehouses and transport
facilities in India as it positions itself to exploit the
opening up of the retail sector.
"With government investments in infrastructure on the rise
coupled with streamlining of regulatory policies, we are
enthusiastic about the fast-paced growth in the logistics
market," Paul Graham, chief operating officer of DHL's supply
chain division for Asia told reporters at a news conference.
"We want to keep ahead of growth. We want to be ready when
our customers want to expand."
Last month, India took the politically fraught decision of
allowing foreign direct investment in its supermarkets.
The expectation is that this opening up will attract greater
investment in India's poor supply chain infrastructure, which
now results in huge wastage in the journey from the farm to
"The new retail legislation lays a huge emphasis on making
India a sourcing hub and that is very important," said Graham,
adding that the company was ready to bring its global retail
logistics expertise to India.
DHL already offers express delivery, global forwarding and
supply chain services in India.
Deutsche Post DHL raised its 2012 profit outlook in August,
bucking a weaker trend at U.S. rivals such as UPS and
FedEx, citing robust demand for its express delivery
services in Asia.
Opening up the retail sector to the likes of Wal-Mart Stores
Inc and Carrefour was part of a slew of
policy announcements last month as Prime Minister Manmohan
Singh's government rediscovered its reforming vim.
Also unveiled was a lifting of the bar on foreign
investments in other sectors such as pensions, insurance and
airlines, raising diesel prices and pushing for faster roll out
of infrastructure projects.
Graham said DHL planned to add 5 million sq ft (465,000 sq
m) of warehousing space, more than doubling its capacity from
the current 4 million sq ft. The warehouses will be in Mumbai,
Gurgaon, Delhi, Bangalore, Nagpur, Chennai, Kolkata and
The company operates a large free trade warehousing zone in
the southern Indian state of Tamil Nadu which caters to the
retail, energy, healthcare and automotive sectors, among others.
Graham said DHL would make further investments in four more
free trade warehousing zones across India, outside the 100
million euros announced now.
Vikas Anand, DHL's chief operating officer for the supply
chain division, said the next such free trade zone investment
would be outside the financial capital Mumbai.
He said the company would work through a tie-up with local
partners to help with the tricky task of land acquisition for
India has been trying to overhaul its century-old land
acquisition law for several years to make it easier to secure
land for industrial and infrastructure projects, but political
opposition, including from its own ministers, has stalled the