India approves FDI in supermarkets
New Delhi - India will open the country’s retail industry to foreign supermarkets, a cabinet minister told reporters on Thursday, a much-delayed reform expected to help unclog supply bottlenecks and ease inflation over time.
The government has allowed 51% foreign direct investment in the multi-brand retail sector, Food Minister K V Thomas said. It also decided to raise the cap on foreign investment in single brand retailing to 100% from 51%, Thomas added.
The decision will be cheered by global retail giants such as Walmart that have long been eyeing India’s lucrative retail sector worth an estimated $450bn a year.
Efforts to liberalise the sector, perceived as politically risky ahead of elections next year in India’s largest state, Uttar Pradesh, have been hampered by the government’s political opponents and sections of the ruling coalition itself