Battling UK retailer Marks & Spencer is to open two stores India - despite being in the midst of closing its outlets in continental Europe.

The high street retailer is set to open the outlets in October: one will be in New Delhi and the other in Bombay. Crossroads, the Bombay shopping mall that customers have to pay to enter yet boasts the highest footfall in India, will be the location of one of the stores. 

The shops will be operated under a franchise arrangement with Planet Sports, a lifestyle retailer owned by the Indonesian-based Gajatungal family. Of Indian origin, the Gajatungals are long-time affiliates of the British store group, having opened M&S stores in the Far East - and they hope to franchises for all subsequent M&S stores in India. Both stores will stock purely clothing.

The three-year lease at Crossroads is believed to be worth Rs20 million (US$0.4 million) per year. M&S's Indian store, like all in the Far-East, will be much smaller than those in Europe at 7000 square feet. The company's Far East chief, Mr Alan Thomas, is expected to visit and sign with Crossroads' managing director JM Mody.

Crossroads already has other apparel own-brand stores, including Pantaloon, Provogue, MTV, and Spanish label Mango.

M&S announced at the end of the March that it would be expanding its international platform on a franchise basis. A company spokesman said: "India is a new market for us but the M&S brand is already well liked there. The expense of running these stores will be carried by the franchise owner."

The retailer is also looking at opening stores under franchise in Saudi Arabia.

By Deborah Bowyer and Navroz Havewala.

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