FIPB nod to Tesco could attract more foreign investments in Indian retail

According to reports, the deal has already been cleared by DIPP

The Foreign Investment Promotion Board's (FIPB) nod to Tesco's proposal to pick up Tata-owned Trent Hypermarkets could pave the way for many such investments in Indian retail.

The decision is expected today.

Though the government has talked about fresh investments of $100 million in the Indian venture, Trent has said the proposed partnership with Tesco will operate and build on the existing portfolio of Star Bazaar stores in Maharashtra and Karnataka, thereby triggering a debate on new ventures versus expansion of existing ventures.

Many retailers, who are looking for foreign partners in their ventures, are keenly watching out for the FIPB clearance to the JV.

According to reports, Department of Industrial Policy and Promotion (DIPP), which forwards the foreign proposals to FIPB, has already cleared the proposal.

"... if the rules and regulations are more clear, we will definitely be willing to partner the best players in the global hypermarket business. We will await the clarifications for the current (Tesco) application before we start discussions with any player," Shoppers Stop managing director Govind Shrikhande said in an interview to this paper last week.

Shoppers Stop is looking for partners for its hypermarket chain Hypercity.