Confirming that government is aimed to prop up growth and investment in the economy, Commerce and Industry Minister, Anand Sharma assured India that it will open its retail sector to foreign supermarkets shortly, a major economic development that has been delayed for months by the political deadlock.
Retail stocks in today’s trade surged on market speculation that the government will finally allow FDI in the country's multi-brand retail sector. The government’s decision would pave the way for global retail chains such as Wal-Mart, Carrefour and Tesco to bring in much needed foreign investment in modern infrastructure such as cold chains and packaging and to set up retail store with a local partner and sell directly to consumers for the first time. This development could transform the $450 billion retail market and docile inflation.
Earlier, the government had allowed FDI in single brand retailing however, suspended the decision to allow such investment in multi-brand retailing due to opposition from several parties including UPA allies.
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