Through a press note on 20 September, India announced that 51% foreign direct investment (FDI) in multi-brand retail trade (MBRT) has been permitted for the first time. The move was part of a round of liberalization that affects nearly all the sectors where opening up was possible in the foreseeable future.
With a fabled middle class population of up to 400 million, retail is the last bastion of India’s economy (excluding agriculture). Indian governments have been trying to protect the economy from being wiped out by foreign competition ever since independence. This is a reaction to being taken over by a trading company which entered India in the 17th century and gained control over the entire trading and political scenario by the beginning of the 19th century.
This sentiment is at the core of all protectionist Indian policies for trade and agriculture over the years.
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Gautam Khurana is the managing partner at India Law Offices in New Delhi
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