AUGUST 7, 1995
Benetton and Indians
RUMOURS from Italy are suggesting that Benetton is in the process of negotiating a major sponsorship deal for 1996 with a large Anglo-Indian group.
The Benetton family would, no doubt, be delighted to carve itself a bigger slice of the Indian market. With a population of 885Êmillion and a fast-developing middle class, India is one of Benetton's major targets, along with China and South Korea. Although the traditional markets of Europe and the Americas are fading, Benetton's results continue to boom because of the new markets it is opening each year.
A sponsorship deal with a large Indian company would help Benetton's sales but would also enable the Indians to draw attention to the fact that India is changing in the wake of economic reform in 1991. There is now a booming private sector with big opportunities for foreign investment.
The identity of Benetton's Indian company remains a secret, but it could be any one of a variety of different groups.
There is Tata, which began in the cotton industry but has diversified widely and now boasts 250,000 employees in all sectors of industry including iron and steel, engineering, petrol and airlines. It may be a deal with one of the sections of Tata which have recently been sold off - notably its detergent business, which was bought by Hindustan Lever.
There is also the Birla group which began in textiles and has diversified into a wide range of goods, including cars, through its Hindustan Motors offshoot.
There are booming smaller companies such as Videocon, which makes TVs, or BPL which deals in all electrical goods. There are also big opportunities in the telephone market as India is privatizing its telephone industry with foreign partners providing the capital to overhaul the systems.
Motor racing does not have a big following in India and until recently was restricted to races on old British airbases. A permanent racing circuit has recently been built at Irungattukutai, near Madras on the Bay of Bengal.