The union government in India hap s opened up the multi billion dollar supermarket sector to international players.

The cabinet approved a plan o allow 51% foreign direct investment in the supermarket sector in the country. The move will allow global giants like Wal-Mart, Tesco and Carrefour to enter the Indian market.

The department of industrial policy and promotion of the India government had put forward a proposal to allow 51% FDI in multi-brand retail and 100% in single-brand retail in the country. Most union ministries are believed to have given their consent to the proposal and a decision is expected next week on the matter. The move will allow foreign players to bring expertise in logistics and investment, which could help address supply bottlenecks in the country.

According to a report, "India, with its growing $1.6 trillion economy, is seen as one of the last frontiers for a massive and modern supermarket sector aimed at hundreds of millions of middle class consumers who still shop in neighbourhood mom-and-pop stores."

The government will subject supermarkets to strict local sourcing requirements and minimum investment levels aimed at protecting jobs. The central government has also said that individual states will be allowed to veto foreign retailers.

This is after a long time that the government has approved a major reform proposal. The move will open up Indian economy more to international players and will further integrate it with the global economy.