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ARTICLE · 12 DECEMBER 2011

Indian Government Announces Reforms to Retail Sector

The Indian Government cabinet has decided to further open up India's burgeoning retail sector to foreign investors.

IndiaInternational Law

Last week the Indian Government cabinet decided to further open up India's burgeoning retail sector to foreign investors.Although much of the media discussion has centred around supermarkets, there is also a significant opportunity for brands seeking to establish retail outlets in the world's second most populous country.

The latest proposed reforms will allow:

  • foreign direct investment (FDI) up to 51 per cent in multi-brand retail subject to certain minimum investment conditions:
    • minimum investment of US$100 million, 50 per cent to be invested in back-end areas - transport, storage and other infrastructure
    • at least 30 per cent of produce sourced would have to come from small or medium-scale industries

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