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India to partly open retail sector to foreign investment
By agencies
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Tuesday, 03 May 2005, 19:30 IST
WASHINGTON:India plans to partially open its $190 billion retail industry, which has been growing as much as five percent a year, to foreigners, Commerce and Industry Minister Kamal Nath has said.
It would be done in a way that encourages investment while protecting the jobs of millions of small shopkeepers who dominate the trade, Kamal Nath said in an interview to The Wall Street Journal.
Initially, the access would be for grocery companies, with priority for facilitating the entrance of refrigerated distribution networks to ensure fruit and vegetables are well preserved in transit to shops, he said.
Nath said that as much as three quarters of the initial opening for foreign investment could be in food and related establishments.
The Journal said the Indian government has been mulling many different proposals to open the country's retail sector. Among those being considered are ceilings of either 26 percent or 49 percent on foreign investment in a retail outlet, it said.
Analysts say, the paper reported, allowing majority control at this time is not likely, given the political realities of India's coalition government, which includes leftist parties.