Chinese Fast-Fashion Giant Shein to Make a Comeback With Reliance

Shein will reportedly work through Reliance Retail's retail division; however, the company has not yet confirmed the announcement. 

Shein, a Chinese online fast fashion retailer, is preparing to return to the Indian market after a ban of three years. According to a report by the PTI news agency, the company will make a return in association with renowned Indian retailer Reliance Retail.

Reason behind the ban 

Shein began operations in 2008. The reason for the brand's appeal to millennials is its reasonable pricing, stylish women's clothing, and other products. However, in June 2020, the brand was outlawed by India's Ministry of Electronics and Information Technology because of the rising hostilities between India and China along their Himalayan borders. Shein was banned along with 58 other apps; however, their products were still available through Amazon.

Domestication of the app 

Officials from the government stated on Friday that the arrangement calls for RRVL(Reliance Retail Ventures LTD) to own and run, a domestic app for Indian users that would be blocked off from the international app.

"Under the agreement, SHEIN has agreed to license its technology and trademarks to be used by RRVL and to also develop an indigenous e-commerce retail platform for Indian consumers to avail of SHEIN-branded products," one of the officials said, as per Business Standard.

"Localisation of infrastructure and platform data are aimed to ensure that the collaboration with SHEIN will always be compliant with applicable Indian laws and strategic interest of the country," the official added.

Business opportunities

With the help of this collaboration, SHEIN will give RRVL the technology and knowledge needed to connect a network of more than 25,000 small enterprises.

"This will create a potential export opportunity of approximately Rs 50,000 crore from India. Even if only 25 per cent of the existing global demand for Shein is sourced from India, there is an opportunity of $7-8 billion," the official cited above said.