Chinese fast fashion giant Shein has made a significant comeback in India, five years after being banned due to data security concerns and rising geopolitical tensions with China.
Background of the Ban
In 2020, the Indian government banned Shein along with several other Chinese applications, including TikTok. The decision was made in response to escalating tensions between India and China, particularly after military clashes occurred in a disputed Himalayan border area. Authorities cited concerns over unauthorized data transmission and security issues as the primary reasons for the ban.
Shein’s Relaunch in India
Shein has now relaunched under a licensing agreement with the Indian firm Reliance Retail. This partnership aims to allow Shein to sell products that are manufactured and sourced within India. The app was launched recently and has been downloaded by over 10,000 users, offering fashionwear starting as low as 199 rupees (approximately $2.30).
Operational Control and Data Security
As part of the deal, all customer and application data will be stored within India, ensuring that Shein will not have access to any of this data. India’s Commerce Minister, Piyush Goyal, confirmed that Reliance Retail would maintain full control over operations and data management. This condition reinforces the government’s commitment to data security while allowing Shein to re-enter the market.
Strategic Move by Reliance Retail
Experts suggest that this collaboration represents a strategic shift for Reliance Retail, owned by billionaire Mukesh Ambani. By integrating Shein into its portfolio, Reliance is diversifying from its previous strategy of exclusively selling international brands through its flagship platform, Ajio. Currently, Shein’s offerings are limited to major cities like Delhi, Mumbai, and Bengaluru, with plans to expand nationwide.
Global Operations and Future Plans
Shein aims to leverage India as a sourcing hub for its global operations. The company intends to collaborate with local garment manufacturers to enhance textile exports from India. This partnership is seen as a rare exception to India’s strict ban on over 200 Chinese apps, highlighting the unique circumstances surrounding Shein’s return.
Conclusion
Shein’s re-entry into the Indian market marks a notable chapter in the ongoing story of international e-commerce and geopolitics. As the brand seeks to reclaim its position in a market it once dominated, the collaboration with Reliance Retail could reshape the landscape of fast fashion in India.
