HispanicBusiness

Starbucks opened its first store in India on Friday as the coffee giant makes its foray into the South Asian country dominated by tea-drinkers.

The flagship store opened in the historic Elphinstone building in southern Mumbai. Two more stores will be opened next week at other locations in the city, a statement said.

Starbucks' Indian operation, called Tata Starbucks, is a 50-50 joint venture between the US-based coffee giant and Tata Global Beverages. It will use locally-sourced coffee beans.

Starbucks, the world's largest coffee shop operator, which runs more than 17,000 cafes globally, first announced last year it would open outlets in India.

"We are investing for the long-term and see great potential for accelerated growth in India," said chief executive Howard Schultz.

The company expects to replicate its success in China, another traditionally tea-drinking country where it opened its first store in 1999 and plans to have 1,500 by 2015.

Coffee is a more popular beverage in south India while people in other regions mostly prefer tea - but that trend might be changing.

According to the state-run Coffee Board of India, the number of coffee drinkers has risen significantly outside of the country's south, and overall domestic consumption has increased by 6 per cent to 108,000 tonnes in 2010 from 102,000 tonnes in 2009.

Bangalore-based Cafe Coffee Day is the market leader with 1,250 cafe outlets followed by Barista and Costa Coffee.