Global Observer

Starbucks to open shop in India

Starbucks to open shop in India

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DELHI -- Will tea-drinking Indians take to America's favorite coffee?

DELHI -- Its long been in the offing...now the first Starbucks cafes are set to open in Delhi and Mumbai, this year.

Will folks in a tea drinking land like India pay Starbucks prices? Upscale coffee shops in big cities charge about $1 to $2. These cafes cater to the growing middle class who don't mind paying a few extra bucks for Western-style coffee houses with music and wi-fi.

Ricky Barua, an environmental activist, believes that the market is already saturated with existing brands like home-grown and hugely popular Cafe Coffee Day as well as Barrista, which is owned by Lavazza- Italy's biggest coffee makers.

"Lets see what happens," said Barua. "Starbucks will have to offer something extra to woo the Indian customer."

Burwa, however, enjoys a cup at U.K.-based Costa Coffee.

The 50-50 joint venture between Starbucks Coffee Company and Tata Global Beverages Ltd., the second largest branded tea company in the world, was announced on Monday.

"We look forward to bringing the Starbucks experience to customers in India by offering high quality Arabica coffee, handcrafted beverages, locally relevant food and legendary service," said John Culver, Starbucks chief for Asia Pacific.

The new cafes will be called Starbucks Coffee "A Tata Alliance." Tata is one of India's largest business house with a wide-range of pursuits from steel to vehicles. "It opens up exciting business opportunities and new formats for Tata Global Beverages. Starbucks brings unique retail expertise as well as a shared sense of business values," said R.K. Krishnakumar, a top executive of the Indian company.

As part of their collaboration, the two companies will also offer an expensive tea called Tata Tazzo.

The two companies also agreed to.use coffee grown and roasted by Tata in Starbucks outlet in India and abroad.

Tata stock prices went up by over 10 percent after the announcement.

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Betwa Sharma

Correspondent

Betwa Sharma has written for the Christian Science Monitor, Time, Foreign Policy, The New Republic, The Daily Beast, AOL News, GlobalPost, The Huffington Post, Columbia Journalism Review, The Times of India, Hindustan Times, Indian Express and The Tribune. She previously worked as the United Nations/New York correspondent for the Press Trust of India, the country's largest newswire. She holds degrees from the National Law Institute University in India, Cambridge University and the Columbia University Graduate School of Journalism. She is based in Delhi, India. Follow her on Twitter. Disclosure