India to outline plans for foreign retailers

India was set on Friday to announce details on how the nation's vast retail sector would be opened to global supermarket chains, after the cabinet backed the key reform policy. Commerce Minister Anand Sharma was expected to make a statement in parliament to outline legislation changes that look likely to push India further towards becoming a modern consumer society. At a late-night meeting on Thursday, the cabinet cleared a proposal to allow international firms such as Wal-Mart and Tesco to hold a 51-per cent stake in multi-brand retailers.    It also raised the foreign investment cap to 100 per cent from 51 per cent for single-brand retail operations such as Gucci, Nokia and Reebok. The move will "open up enormous opportunities in India for expansion of organised retail," said Confederation of Indian Industry president B. Muthuraman. The Congress-led government has been seeking to fend off charges of "policy paralysis" after being engulfed in a string of corruption scandals.    The decision was seen as a sign of its intention to press ahead with its reformist agenda despite strong political opposition. Foreign multinationals have lobbied for years to sell directly to consumers in the world's second most populous nation, seeking access to a market estimated by Indian consultancy Technopak to be worth $470 billion a year. Multi-brand foreign groups such as US-based Wal-Mart currently operate as wholesalers in India but are prevented from selling directly to the public. The vast majority of consumers currently shop at small local markets. Raj Jain, chief executive of Wal-Mart's Indian arm, said the government's move contributed toward India's image as a "welcoming destination for international businesses." But he added the company needed to study "the finer details of the new policy" before commenting further. Critics have worried that modern, large-format stores will drive small family-owned shops out of business, despite assurances from industry figures that the market is big enough to embrace all players.    The retail sector is the second-largest employer after agriculture in the country of 1.2 billion people, consultancy Deloitte says. The main opposition Bharatiya Janata Party (BJP) and left parties have vowed to strongly oppose the plan, calling it "a tool to kill the domestic (retail) industry".