New Delhi, Sep 14: The Cabinet Committee on Economic Affairs cleared the foreign direct investment (FDI) in multi-brand retails on Friday.
The move will give opportunities to foreign firms like Walt-Mart to set up their units with local partners and sell directly to consumers. Analysts believe this could affect a change in the nation's $450 billion retail market and succeed in taming inflation. The state governments are supposed to decide on the modalities of the implementation.
The Cabinet's decision to allow foreign investors to own 51 per cent in the Indian supermarkets in November last year had been stalled after some allies in the UPA and opposition parties protested the move. According to one report, the government had gone ahead by allowing foreign investment in single-brand retail to 100 per cent from the earlier 51 per cent.
The BJP and Left slammed the government over the decision. While the BJP said such a decision was a betrayal of democracy, the CPI(M) said the government was trying to cover up its failure. The Trinamool Congress said it was opposing the decision. Both allies and opposition of the Congress were protesting the decision to increase price of diesel, which was made effective on Thursday.
Future Group Chairman Kishore Biyani welcomed the move.