Shein Returns to India via Reliance Retail, Targets Local Manufacturing & Data Sovereignty

The Chinese fast-fashion giant makes a comeback with Reliance Retail, focusing on Indian manufacturing and strict compliance with data security laws.

February 2, 2025: New Delhi:
Chinese fast-fashion giant Shein has re-entered the Indian market through a strategic partnership with Reliance Retail, nearly five years after its ban amid diplomatic tensions in 2020. The move aims to tap into the growing demand for affordable fashion while adhering to local manufacturing and data sovereignty requirements.

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The new Shein India Fast Fashion app, available on both Android and iOS platforms, initially caters to major cities like New Delhi, Mumbai, and Bengaluru, with plans for a nationwide rollout. Prices for products start at an affordable ₹199, and all items are manufactured locally by Indian manufacturers.

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Reliance-Shein Partnership

Under the agreement, Reliance Retail retains complete operational control, while Shein operates as a technology partner, earning a licensing fee for its brand usage. Importantly, Shein has no equity stake or access to customer data, which must remain stored in India to comply with strict regulatory guidelines.

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Commerce Minister Piyush Goyal confirmed that the deal underwent rigorous scrutiny by ministries, including IT and Home Affairs, ensuring alignment with national security and economic interests.

Shein’s Global Growth Amid Regulatory Scrutiny

Shein’s return to India coincides with its growing global dominance. In Q3 2024, the platform became the world’s most visited fashion and apparel website, surpassing brands like Nike, H&M, and Zara, and accounting for 2.68% of global web traffic.

In response to Shein’s market disruption, Amazon recently launched a low-cost storefront and is expanding its focus on the budget fashion segment, particularly in the U.S., one of Shein’s largest markets.

However, Shein’s rapid expansion has drawn attention from global regulators. In Europe, the brand faces increased scrutiny under the EU Digital Services Act due to its 108 million monthly active users. Meanwhile, Shein is also preparing for a potential London stock market listing in 2025 after abandoning earlier plans for a U.S. debut.

Impact on Indian E-commerce

Shein’s comeback through Reliance marks a significant shift in India’s fast-fashion landscape. The focus on local manufacturing aligns with the government’s “Make in India” initiative, potentially creating jobs and boosting domestic production. However, the move could also intensify competition among e-commerce giants vying for dominance in the affordable fashion segment.

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Tags:

Shein India, Reliance Retail, Indian E-commerce, Fast Fashion, Data Sovereignty, Make in India, Piyush Goyal, Shein Global Expansion, Amazon Fashion, Affordable Fashion India, Digital Services Act, London Stock Market.