New Delhi: German sports and lifestyle company Puma AG is in the process of setting up a wholly owned subsidiary in India for marketing and sale of its products.

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The company would undertake wholesale trading in various Puma brand footwear, apparels, sporting goods as well as accessories such as caps, bags and other sports and leisure materials and recently received permission from the Foreign Investment Promotion Board (FIPB).

According to the plans, the German company will not set up the Indian subsidiary on its own but will do it through its Austria-based subsidiary, namely, Austria Puma Dassler (APD). APD is a wholly owned subsidiary of the German company.

Officials said the Indian company would adopt dual sourcing policy for marketing its products. On the one hand, it would import from its facilities outside India and sell them in the local market. Simultaneously, it would also source its products from approved domestic manufacturers.

Puma's current licensee in India, Planet Sports, would continue to operate the business until Puma was fully operative in January of 2006. After that, Planet Sports would become a Puma customer as well as a Puma retail partner with the goal to jointly develop the retail infrastructure on a non-exclusive basis.

According to informed sources, Puma has identified significant potential for the company in India in the long run and intends to fully explore in the early years of the market's development.

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