India Dispatch: The UAE-based retail group Lulu will finally open its first mall in India next month after completion of the 16 billion rupee project in Kochi, Kerala.
Lulu's first mall in India set to open next month after delay
The UAE-based retail group Lulu is set to open its first shopping mall in India next month.
The 16 billion rupees (Dh1.08bn) mall in Kochi, in the state of Kerala, was scheduled to open at the end of last year following repeated delays, but further construction setbacks meant that the launch of what will be one of the country's largest malls was pushed back again.
Management at the development confirmed that the opening had now been rescheduled for March 10. Its launch comes at a time when India is experiencing slowing economic growth and high inflation levels, which has affected consumer spending.
Still, with Kerala being an affluent state, the mall is likely to thrive, according to the local chamber of commerce.
"There are more consumption opportunities here," said Savio Mathew, the secretary of the Kerala Chamber of Commerce and Industry.
The mall, in the Edapally area of Kochi, covers 17 acres and includes a large ice rink, muliplex cinema, restaurants, a Lulu hypermarket and a bowling alley. The developer is also building a Marriott hotel as part of the complex.
Signage describes the development as "India's largest shopping mall", but information available elsewhere suggests that it will be India's fourth-biggest mall. It is expected to create direct employment for about 8,000 staff.
"People are excited in the sense that they will get more opportunity to shop and more brands will be coming," said Mr Mathew.
India, whose retail market is heavily fragmented, last year relaxed its laws on foreign direct investment in retail to try to encourage more retail brands to enter the country. These changes are expected to lure more foreign brands, including large supermarket chains, such as Wal-Mart and Tesco.
"India has witnessed sustained growth in merchandise retail in the last decade," according to a report by Technopak, a retail consultancy. "Despite the economic uncertainty and the slowdown in India's economy, the growth of merchandise retail will continue to grow sustainably.
"The main reason for this growth is the fact that India's GDP will continue to grow at a sustained rate of about 6 per cent in the next decade. This growth in GDP translates to growing consumption in Indian households.
"Corporatised retail's share of total merchandise retail will at best grow from the current 7 per cent to 20 per cent by 2021," Technopak added. "The retail sector started to see private investments from both Indian and international players [to such extent as they were allowed] in the past 15 years."
Links between Kerala and the UAE are strong. Yusuff Ali, the managing director of Emke Group, of which Lulu is a division, is originally from the Indian state. Dubai's Tecom Investments is developing a vast business park project in Kochi, while DP World has invested in and operates a large container terminal in the city.
"Kochi - acknowledged as the gateway to Kerala - is perhaps the most significant city on the country's west coast, after Mumbai," Lulu states on its website.
Emke Group, which is an alias of LuLu Group and of which Lulu Hypermarkets is a division, was founded by the Indian expat MK Abdulla in Abu Dhabi more than four decades ago. The group is aiming to expand its presence in India, having said that it is planning a total investment of 40bn rupees in the country over the next couple of years.