MUMBAI (Reuters) - Reliance Retail has launched an app in India to sell fashionwear from China's Shein under a licensing deal, almost five years since Shein's app was banned in the country after getting caught up in a diplomatic tussle.

Reliance, owned by billionaire Mukesh Ambani, launched the app on Saturday morning, said a person with direct knowledge of Reliance's launch plans. The firm did not announce the launch.

Neither parent Reliance Industries nor Shein responded to requests for comment outside of business hours.

The Shein India Fast Fashion app represents a departure from Reliance's strategy of adding brands to its flagship fashion app Ajio - whose offering includes Superdry and Gap - as it competes with rivals such as Myntra from Walmart's Flipkart.

Shein, founded in China in 2012 and later headquartered in Singapore, offers a vast selection of low-priced Western clothes. Its app was banned in India in 2020 alongside other Chinese apps such as ByteDance's TikTok due to data security concerns, after a border dispute soured Indo-Chinese relations.

Last year, India's government disclosed to parliament that Reliance had entered an agreement with Shein under which Indian manufacturers would supply products under the Shein brand. It did not make any other details public.

"The fashion OG (original) is back," said a message displayed upon opening the app. Deliveries will initially be limited to a few cities including New Delhi and Mumbai and expanded nationwide soon, it said.

Offerings include dresses priced as low as 350 rupees ($4).

Reliance will pay a licence fee for using Shein's brand name, said the person with direct knowledge of the matter. There is no equity investment in the partnership, the person said, without elaborating on financial arrangements.

All Shein-branded products sold through the app are designed and made in India, said a second person with direct knowledge of the matter. The clothing will later be made available on Ajio, the person said, without providing a time frame.

Shein aims to list in London in the first half of the year. It ended its attempt to list in the U.S. following objections from lawmakers who questioned China's requirement for businesses to seek approval to list abroad, Reuters has reported.