CHAUDHARY GROUP ENTERS RETAIL BUSINESS

MEDIA GOOGLE

“I’ve been just furnishing replies. I was unnecessarily dragged into a controversy by Prachandaji. Not only journalists but friends in the party as well have been asking questions after he took my name. Party colleagues don’t believe me when I tell them I don’t know anything. I was looked at suspiciously in the past as well.”

(Krishna Prasad Shitaula on queries after Prachanda said the NC general secretary was aware of his east Nepal visit, Budhabar, 14 Sept.)
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CHAUDHARY GROUP ENTERS RETAIL BUSINESS
Kathmandu, 14 Sept.: The Chaudhary Group (CG)– the first Nepalese Conglomerate with over 40 Companies under its umbrella– has geared up for their entry into the retail sector business in Nepal with their chain of supermarkets, The Himalayan Times.

The group has appointed Beyond Squarefeet Advisory Pvt Ltd, an Indian consulting firm, as their handholding advisory for the project, steering the retail entry strategy for the group.Beyond Squarefeet will be involved in the Retail entry strategy for the group along with planning of store formats, layouts, designing of the supermarkets, creating of the merchandising mix, planning strategy, branding etc. Beyond Squarefeet along with the group is currently in the process of developing the final business plans for the new retail chain.

According to Ashish Sharma, chief executive officer of the group, CG is entering in retail business to strengthen its business network. “Our entry into retail is a forward integration of our various businesses. Since we already have the knowledge of the consumers through our FMCG business, we are sure that it will help us to deliver the expectations of the consumer,” he said.

The organised retail in Nepal is still at a nascent stage with very few players in the market. The organised retail sector of Nepal is about less than one per cent of the retail trade.

“Having been part of the learning curve of the Indian retail industry for over two decades, we feel that our learnings from India would be well utilized in setting up a retail chain in Nepal as most of the socio-economic trends are similar,” said Susil S Dungarwal, chief mall mechanic at Beyond Squarefeet.

Dungarwal has been part of many retail start-ups including brands such as The Kemp Fort, Shoppers Stop, Varsha Lifestyle, Haiko supermarket, The loft, Culture Shop, The Loot and others.This retail chain is slated to be the CG’s first retail venture.

Here on, the group plans to set up an entire chain of supermarkets within the next five years, under CG Retail Pvt Ltd.
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INTERVIEW

There has been great excitement, debate and controversy about the plans of the Asia Pacific Exchange and Cooperation Foundation (APECF) to mobilize investment of US$3 billion for the development of Lumbini as a Special Development Zone (SDZ). Purna Basnet OF Republica caught up with Xiao Wunan, executive vice-chairman of APECF in Four Seasons Hotel, Hong Kong last Friday to shed more lights on the issue.
EXCERPTS:

What is the current position of the Lumbini plan?

It is in the planning stage. Some reports said China is investing US$3 billion but without a feasibility study no one can invest such a big amount. We will hire a professional team for planning, which will take about one year. We hope that will happen faster but it will certainly take at least six months. APECF needs a concrete idea to come to Lumbini. APECF signed the MoU with UN Industrial Development Organization (UNIDO), Beijing, for feasibility study. UNIDO is a consultant for planning and framework designer of the project.

Was a MoU actually signed with UNIDO?

Yes, but there has been some misunderstanding and distortion in this regard. The misunderstanding was that UNIDO would get a slice of the profits. But that’s not the case; UNIDO was acting as a consultant for planning.

But the UNIDO headquarters refused to recognize the MoU. What is your take on that?

I cannot answer this question on the record.

Don´t you think that the MoU signed by APECF and UNIDO in Beijing is against Nepal’s national sovereignty?

It is a part of the process. When we wanted to do this project, we needed to get the approval of Nepal. Before signing the MoU with UNIDO, I met more than 10 members of the cabinet of Nepal, including the finance and deputy prime minister and culture minister. UNIDO as a consultant was advising us on whether or not to go ahead with this project and how to carry it out.

We hired five organizations, among them a famous US think tank, to study the possibility of this project and a bank to advise us on the investment risks. So, before all these study reports come out, we would not know what the political, economic and social risks are. The MoU was signed just for feasibility study. Lumbini belongs to Nepal and Nepali people are going to benefit from it. So this is not against Nepal´s national sovereignty.

Why did APECF choose Lumbini?

First of all, this project is beneficial to Nepal and also to the Buddhists all over the world. It is not only good to Nepal but also the whole of South Asia, including India. The reason behind choosing Lumbini is simple: After the financial crisis of 2008, Asian countries are studying new development models. The Lumbini project gives us a chance to figure out an Asian development model. Do we need to follow the same old Western style when we are pursuing economic development?
Asia Pacific Exchange and Cooperation Foundation (APECF) signed the MoU with UN Industrial Development Organization (UNIDO), Beijing, for feasibility study. UNIDO is a consultant for planning and framework designer of the project.

What is your main concern vis-à-vis this project?

From the point of view of investors, what we are concerned about the most is security. The top priority for the investors is seeking the approval of Nepal government. They need Nepal’s assurance and the support of legislations to protect them. This is common sense. But before we can talk to the Nepal government, we need a feasibility study and a plan about this project. And this procedure is still in progress. So we hired UNIDO to do the risk evaluation.

Many people think that this is a Beijing-backed plan. What exactly is the link between the project and the Chinese government?

Right now, the project doesn’t have any links with the Chinese government. As much as we need the approval of the Nepal government, in the future we will seek approval from Chinese, Indian and Bangladesh governments and all the neighboring countries. We will also seek approval from the international community.

By international community, do you mean the United Nations?

Yes, we are going to the UN headquarters in New York on October 5. I will introduce the Lumbini project to more departments in UN there.

Are you on a dialogue with UN secretary general on this project? Do you think that the UN body will approve it?

First of all, approval from the Nepal government is most important. Based on this, UN, international community, worldwide Buddhists organization, investment fund and others need to work together to make it happen. It cannot rely on only one organization. But, of course, UN is playing a very important role. UN Secretary General Ban Ki Moon is very concerned about the project and he will actively help. There were some reports that UN chief Ban supports this project.

Why are there only two representatives from Nepal in the nine member co-chair list of APECF? And why did APECF choose Pushpa Kamal Dahal, the UCPN Maoist Chairman, and Paras Shah, the former crown prince, from Nepal?

NGO is not a government. First of all, we need to have a board. At first, when we invited these two men to become co-chairs, we did not take the political condition into account. What we only wanted to do then was to do something good for Nepal and Nepali people. At that time, I only knew these two people as having some influence in Nepal that could be helpful in carrying out the project. But the number of people from Nepal does not have to be limited to two. If there are some influential people who are interested in APECF and are committed to develop Nepal, they are all welcome and would be invited.

We invited Dahal back then because he didn’t have any government position. Usually, NGOs don’t entertain in-service government officials. A lot of government officials join NGOs after they retire. Our invitation is not restricted to the Buddhists but also people from other religions from all over the world.

Why is Shah no longer in the list of co-chairs?

The name of the former crown prince was removed from the website due to some technical reasons. We have to study more about Nepal´s politics. Our understanding of Nepal´s politics when we established the foundation and invited the co-chairs was quite different from our understanding now. When we formed the foundation, we didn’t have the project of Lumbini. So, we didn’t take much consideration of Nepal´s political situation. But now, as we have a project, we need to reconsider the political environment.

Is Shah still one of the co-chairs?

I can’t answer directly whether the former prince is still in the list or not. But we need to do a rethink about the reality of Nepal. When we invited him back then, we had never been to Nepal, and we didn’t have the Lumbini project.

Does APECF have any other project?

We do have several projects that are related to religious talks and exchanges, charity and study of Asian model. The foundation is new but the groups that initially formed the foundation have experience of more than 10 years.

Does the foundation have a chairman?

No. There are some co-chairs. That is quite common for an NGO.

Does the Chinese government support the foundation?

The fact is that we are an NGO and thus different from a government. But it is common for foundations all around the world to seek support from governments. In APECF, our funding comes from the participants, mostly enterprises. What we are promoting is Asian values and cultures.

How do you promote Asian values by having so many co-chairs from the Western society?

Though these co-chairs come from the West, they have one thing in common: They all focus on Asia and oriental culture. For example, take the case of Steven Clark Rockefeller Jr. The members of his family have been involved in Asian affairs for more than 100 years. His grandfather taught Hinduism in New York University for 23 years. I myself went to India to learn yoga and meditation. I have many Hindu friends.

Can enterprises involved with APECF invest such a big amount?

Asian Development Bank talked to Nepal government on a similar project and they had a similar figure. One half of the money will be spent on the infrastructure project including telecom, traffic, electricity, anti-pollution, etc., and each of them is different. Take telecom as an example. Nepal now is moving from 2G to 3G and it’s a good market. This is commercially reliable. After these infrastructures are done, the second part is tourism. For this, we are talking to Australia, UAE and other countries.

After infrastructure and tourism, the temple construction is not really a big problem as we have so many Buddhist organizations all around the world. Therefore, though US$3 billion looks a huge budget, with these three stages separated, actually it’s not that big.

Lumbini is a geo-politically sensitive place and there are concerns from the Indian establishment that this plan has something to do with Chinese strategy. How do you assess these concerns?

That is an unnecessary worry. We will improve transparency and ensure broader participation. To link this issue with security concerns is just an overstretching of one’s imagination because this project is mainly about temples and the majority of foreigners who go there are Buddhists. What they will be doing is just sitting under a tree. They won’t move. How can you consider this as a military threat?

However, it’s normal for misunderstandings in the beginning because this place is sensitive from a geo-political perspective. Maybe, the misunderstanding will gradually disappear once the project moves ahead.
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