China's Shein to make a comeback in India, teams up with Reliance Retail: Report

Chinese fast fashion behemoth Shein will make a comeback in India with Reliance Retail, said a report on Thursday. Indian government has approved the partnership between Shein and the retail unit of Mukesh Ambani's Reliance Industries, reported Wall Street Journal.

The Chinese giant’s platform was banned in India in June 2020 as part of government's ban on dozens of Chinese apps as tensions between the two countries escalated following a skirmishes along LAC in Ladakh.

Founded in 2008 by Chris Xu, Shein was a hit among Indian women and girls for its affordable, trendy fashion items.

In June 2020, the Ministry of Electronics & IT had decided to ban multiple applications originating from China citing privacy and data concerns. Apart from Shein, the ban also included apps like TikTok, UC Browser, ShareIt, Clash of Kings etc.

Mod- led BJP government had told the Delhi High Court in 2021, that Shein was banned by it in the interest of India’s sovereignty and security of the state. While responding to a petition seeking a ban on sale of Shein’s products by Amazon in India, government had said, “A blanket order for blocking sale of Shein products in other platforms/websites cannot be passed by the Committee constituted under section 69A of the IT Act, 2000."

According to Shein’s website, the primary source of Shein-branded products is US, India, Brazil and Australia. The manufacturing unit of Shein is permitted to use cotton only from these countries and other approved regions such as Bangladesh, Tanzania and Pakistan.

Since Shein faces scrutiny in the US over the sourcing of cotton, the company is likely to source fabrics from small businesses in India, which could help the company to diversify its supply beyond China, the report added citing sources.

Shein is a company founded in China but the headquarter is now based in Singapore and the approval from India means the government now considers Shein to be a non-Chinese entity, the report added.

Through the partnership with Reliance Retail, Shein could reach India’s large young population. On the other hand, Reliance could benefit from Shein’s brand recognition, technology and supply chain, said WSJ.

Shein raised $2 billion in its latest fundraising round that values the company at $66 billion, about a third less than a year earlier, the Wall Street Journal reported on Wednesday, citing people close to the company.

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