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. Last Updated: 07/27/2016

Sweet and Sour Global Growth for McDonald's

COMBINED REPORTS


Call it the Big Mac attack. As the golden arches of McDonald's Corp. go international, the global chain is catering to local palates in India but fighting off nationalist attacks in Indonesia and France.


The McDonald's Corp opened its first restaurant in India on Sunday, highlighting a new "Maharaja Mac" that does not contain any beef in keeping with Hindu religious practices, officials said.


"We have worked hard to ensure that our products are appropriate for the taste and culture of India," said Vikram Bakshi, managing director of the first beefless McDonald's branch, which opened Sunday in an upscale New Delhi neighborhood. "We have worked carefully to cater to the vast majority of the vegetarian population."


McDonald's made its worldwide reputation serving hamburgers made of beef. But Hindus, who make up more than 80 percent of India's 940 million people, do not eat beef, and many are vegetarians.


The "Maharaja Mac" will contain mutton -- eaten by Hindus and savored by Moslems, who shun pork.


Bakshi said McDonald's India, whose emblem is a peacock's wings spread behind the fast food chain's familiar golden arches, is 50-percent owned by Indian investors, and cannot be called foreign.


"McDonald's India is an Indian company," Bakshi said.


He also said McDonald's would buy 98 percent of its food and other supplies from local sources, benefiting Indian businesses.


McDonald's officials said they were confident their restaurant would not encounter the same difficulties as Pepsico Inc.'s Kentucky Fried Chicken chain.


Farmers protesting against "cultural imperialism" ransacked a Kentucky Fried Chicken restaurant in the southern city of Bangalore in January.


But just as the golden arches are making their Indian debut, Indonesia has declared war on the rapid spread of foreign fast-food franchises.


President Suharto has told his Cabinet to find ways to restrict foreign restaurant chains in order to protect local vendors.


"The president wanted us to find a solution that is not against international free-trade principles,'' Food Minister Ibrahim Hasan was quoted as saying in Saturday editions of the Jakarta Post.


Chains such as Kentucky Fried Chicken, McDonald's and Pizza Hut have spread rapidly in Indonesia's larger cities, expanding from a total of only six restaurants in 1991 to 118 last year. More than 75 percent are parts of U.S.-based chains.


Indonesia isn't the only country worried about huge international corporations hurting local restaurateurs. In France, the National Assembly's finance committee recently approved a proposed amendment that would boost the tax on take-out from 5.5 percent to 20.6 percent.


Fast food restaurants and bistros alike have to charge the top sales tax rate of 20.6 percent for diners. But with take-out comprising about 40 percent of fast food revenue, the so-called "Mac tax'' would hit hard.


An organization of fast food restaurant operators predicted a 15 percent rise in prices and noted they primarily employ youth, who are plagued by high unemployment.


Belgian-based Quick, a leading hamburger chain in France, saw its stock fall 7.5 percent on news of the proposed tax.


McDonald's, with 500 restaurants in France that employ 25,000 people, declined immediate comment, but officials there privately hoped the tax would be dropped from the budget in conference committee.


Laurent Dominati, a centrist lawmaker who proposed the amendment and whose constituency includes bistros on the bustling Rue de Rivoli in central Paris, defended his idea. "The philosophy is to re-establish equality between fast food, the cafes and the restaurants,'' Dominati said.


On the Rue de Rivoli, a McDonald's and a Quick are usually jammed with young customers while many cafes languish. ()