Foreign investment in Indian retail to boost local food industry
Under the recommendation, foreign investors will be allowed in the Indian retail market through partnerships with local retailers, taking up to a 51 per cent stake in such ventures.
Previously, successive government have resisted opening up the country’s multi-brand retail sector because of fears that around 15m traditional ‘kirana’ stores would not be able to compete with the retail giants.
Consequently, under current rules, only single-brand retailers such as McDonald’s can invest up to 51per cent through international investments, with multi-brand retailers restricted to wholesale B2B operations.
If the recommendation passes the cabinet of ministers and then the Parliament, the Indian food retail sector will see a major boost and provide more opportunities to food manufacturers.
