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India closer to opening up $450 bln retail sector

NEW DELHI, July 23, 2011 (AFP) - A top Indian government panel has approved a plan to allow foreign direct investment (FDI) in the country's vast retail market in what would be one of the country's biggest economic reforms.
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"Business confidence will grow. It will definitely benefit the farmers as well as consumers, besides attracting more investments," D.
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S. Rawat, secretary general of the Associated Chambers of Commerce and Industry of India.
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But it said investors would have to put in at least 0 million to set up multibrand retail stores and would only be allowed to operate in cities with at least one million people, the Press Trust of India said late Friday.
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The proposal to more fully open up the Indian retail market, whose annual sales are estimated at around 0 billion, now must go to the federal cabinet for approval and then overcome widespread political opposition.

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The move would mark one of the biggest reforms by India's Congress-led government. But analysts say it could be difficult for the embattled government to push through the major changes as it fends off a slew of corruption charges.

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Multi-brand foreign groups such as US-based Walmart currently operate as wholesalers but cannot sell direct

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