Plans by Carrefour, the world’s number two retailer, to open its first cash-and-carry outlets in India are a sign of optimism in the country’s USD450 billion retail sector, but foreign investors and some officials want more — an easing of the country’s tough investment rules.
Just days before Carrefour’s announcement, Africa’s Shoprite Holdings said it may quit India because restrictive foreign investment laws have hamstrung its growth, highlighting the many hurdles for foreign retailers.
India’s retail industry is among the fastest growing in the world, but it remains heavily regulated, with strict limits on foreign investment. Even big local retailers face opposition in some states amid claims they cause massive job losses.