Shein Returns to India Through Strategic Partnership with Reliance

Chinese fast-fashion giant Shein has re-entered the Indian market through a strategic alliance with Reliance Retail, nearly five years after its ban due to diplomatic tensions between India and China. This collaboration, spearheaded by billionaire Mukesh Ambani’s retail division, marks Shein’s significant comeback in one of Asia’s largest consumer markets. Notably, this relaunch coincides with the Chinese company’s highly anticipated public listing later this year.

Unlike its independent operations in the past, Shein now only provides the technology. Reliance fully owns and operates the Shein India Fast Fashion app, having full control over the operations and data of the platform. The Indian government has imposed strict conditions: all customer data should be locally stored and not shared with Shein. This tight control was one of the main reasons for approval to restart the app.

The move is a deviation for Reliance from its strategy of incorporating international brands, including Muji, into its Ajio fashion platform. It is considered one of the biggest moves to give Reliance a strategic play in India’s competitive e-commerce landscape. Despite being India’s biggest retail chain and leading telecom operator, Reliance has hitherto been unsuccessful in taking on dominant online players such as Flipkart, Amazon, and Meesho. Flipkart is fantastically strong in the fashion vertical, having topped the market leaderboard for many consecutive years. Recently, Flipkart’s fully owned subsidiary-Myntra-started ultra-fast delivery to ensure fulfillment of some orders in less than 30 minutes.

Currently, Shein is doing deliveries in selected cities such as New Delhi, Bengaluru, and Mumbai, promising a pan-India expansion shortly. The app does not charge for delivery, and the products start at just 199 rupees ($2.30). All items sold on the platform are designed and manufactured in India, hence supporting local producers.

Approval from India for Shein to return marks a rare exception in its 2020 ban on more than 300 Chinese apps. To secure this, Shein agreed to strict oversight, including periodic security audits by government-approved cybersecurity firms. Commerce Minister Piyush Goyal underlined the fact that the decision was taken after thorough evaluation by multiple ministries, a move to ensure adherence to India’s strict data sovereignty laws while giving a fillip to the domestic textile industry.