India opens up to more FDI

Based on article from The Telegraph, 14 January 2007

The Indian government has announced their plans to allow companies like Tesco to set up chains in India. Currently, only single brand retailers, which only own 51% of the company are permitted.

One of the main ways in which India will be able to fulfil their potential by 2050, as set out by a Goldman Sachs report, is to allow FDI (Foreign Direct Investment) into the country and through allowing retail companies to set up, India will see a rise in investment. It will generate 2.5m jobs directly and a predicted 10m in the years afterward.

India's commerce minister, Kamal Nath said that "We are looking at allowing FDI in sectors within retail that lead to incremental economic activity and do not displace neighbourhood stores".

The retail sector in India is expected to grow from £6bn to £23bn by 2010 and should attract abour £2bn in investments from overseas.

There is also some outsourcing of jobs involved - Tesco announced that 190 finance processing jobs will be transferred from Cardiff to Bangalore over the next 12 to 18 months.

Links:
India opens up to retailers - The Telegraph