Reuters

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New Delhi -

India's Commerce Minister on Friday defended the government's decision to open the country's retail sector to foreign supermarket chains, saying the move would create an estimated 10 million jobs as well as protect small shops and farmers.

But opposition parties remained unconvinced and stalled the parliament in protest at the policy, which they say will have the opposite effect.

India's cabinet late Thursday allowed 51-percent foreign direct investment in the multi-brand retail sector. It also decided to allow 100 percent investment in the single-brand sector.

Wal-Mart, France's Carrefour and Britain's Tesco have all expressed an interest in opening stores in India.

Seeking to allay apprehensions among political parties, Anand Sharma told a press conference that the move would help curb massive food wastage and high inflation while developing rural infrastructure in the country.

Giving the outlines of the policy, Sharma said investment needed for entering the sector had been estimated at 100 million dollars, 50 percent of which should be set aside for developing back-end infrastructure such as cold chains and warehousing.

Thirty percent of the sourcing would be via local small and medium enterprises, while the outlets would be allowed to open only in the 53 cities that have a population of over 1 million.

“It will give a fillip to job creation in the manufacturing sector, value addition and it will have a multiplier effect for the economy,” Sharma said.

“By initial estimates, we hope that in excess of 4 million jobs will be created and in the logistics anywhere between 5 to 6 million jobs will be created over a period of three years,” he said, asserting the policy would not affect small domestic retailers.

The decision was also supported by corporate leaders, who argued that it would inject competition and efficiencies in the retail sector and benefit both farmers and consumers. - Sapa-dpa