Sources close to Tesco revealed today that it is involved in a cost cutting exercise because it faces threats in its home market - the UK -  from supermarkets such as Aldi and Lidl.

At the same time, a second source said that it wants its staff to stay in Tata Ginger hotels, rather than occupy fine apartments close to its central mother ship in Whitefield.

One source told The Examiner: "Tesco saved £100 million by moving to Bangalore." She explained under conditions of  complete anonymity that practically all logistics for the mega grocer came from Bangalore.

But economic conditions in the home market mean that Tesco will have to continue to cut costs. Smaller chains of grocers are making slight inroads into Tesco's market share. Those, she said, included Aldi and Lidl. Tesco, she added, continued to make exceptional profits.

A landlord told us that he'd been approached for a termination of a contract. He said: "Tesco explained to me that it was cheaper for their staff to stay in Tata Ginger hotels rather than in my house." He added: "Tesco became amenable to my way of thinking when I pointed out to the housing department that this was a false economy."

At press time, Tesco Bangalore was unavailable for comment. X