India’s retail market takes another step toward foreign investment

India took another step toward opening its valued retail market to foreign investment today when that country’s upper house of Parliament passed a second vote on the initiative this week.

While largely symbolic, Prime Minister Manmohan Singh’s coalition government is trumpeting the move as support for his economic reforms, The Associated Press  said.

The lower house passed a vote earlier this week, meaning big-box retailers like Wal-Mart can now open stores in India.

Experts estimate India’s retail sector is worth $450 billion, Reuters reported.

India is fighting severe deficit, government corruption scandals and a beleaguered insurance and pension industry.

More from GlobalPost: Indian parliament opens door to foreign retail investors

Singh needs support through a coalition government to introduce his reforms.

“Overall, it is a positive development. More than anything else, I think it reaffirms the political will to start reforms,” economist Saugata Bhattacharya told Reuters.

However, there are those who say the new regulations will have muted impact.

Retailers will have to move quickly to take advantage of a business-friendly government with India’s next federal election just over a year away.

“I give a solemn assurance that after the next (parliamentary) elections, the next government will reverse the decision of the UPA (United Progressive Alliance),” opposition politician Vasudevan Maitreyan said, Gulf News reported.

Moreover, the AP reported that the federal government would allow states to deal directly with foreign retailers, and 10 of India’s 28 states said they wouldn’t allow big-box stores.

More from GlobalPost: India slated to take No. 2 spot in manufacturing — following China