Business, Economics and Jobs

India to throw open its doors to Walmart... Again

I hesitate to say it, but India is once again set to throw open its doors to Walmart, Carrefour, Tesco, and the rest of the world's superchains. Of course, it's been set to do so for about five years, and has even done it once (for a minute).  So, what I'm saying is, if you have a dog in this fight, don't start cashing your check yet.

Nevertheless, I feel it is my duty to report that "the government is likely to announce an FDI package within the next fortnight, which could include allowing foreign investment in multi-brand retail and the civil aviation sector," according to Business Today et al. 

The plan to open up the sector has been scaled back, however. Where previously, the government had planned to allow foreign companies to own majority stakes in local hypermarket chains, the scuttlebutt is now that FDI will be limited to 49 percent, the magazine said.

Manmohan Singh's cabinet moved to open up multibrand retail to 51 percent FDI last November, but he was forced to roll back the policy almost immediately, following strong protests from the Trinamool Congress and the DMK -- his allies in the United Progressive Alliance coalition. (As GlobalPost has reported, this has been touted as the beginning of the "policy paralysis" which has soured global investors on the India story).

Now, the government plans to leave it up to individual states to welcome Walmart or keep them out, at their own discretion, Business Today says. Several Congress-ruled states including Delhi, Maharashtra, Rajasthan and Uttarakhand have already written to the Union government expressing their willingness to implement the decision, of course.