India Opens Doors to Foreign Retailers
New Delhi, India, In a step towards liberalizing the country’s booming retail trade, India has decided to let foreign brands open their stores. Retail giants such as Wal-Mart Stores still can’t set up shop in the country, however, as the government decision applies only to single-brand retailers, such as Adidas.
Global retailers have been lobbying India to open up its $200 billion retail market—currently dominated by more than 12 million independent shops—but opposition from domestic businesses and Communist coalition parties has forced the government to move slowly. The new rule will allow foreign companies to own up to 51% of businesses in India, provided they gain government approval and sell only their own goods.
Communist coalition parties, whose support is critical to the government’s parliamentary majority, criticized the decision, saying that even such a limited opening could pave the way for stores like Wal-Mart to enter the country.