Trade and Industry Minister Anand Sharma said on Friday that talks to open up the country's multi-brand retail sector to foreign investors were at an advanced stage, but he did not give a deadline.
"We are very seriously engaged," Anand Sharma told Reuters in an interview in Kuala Lumpur. "It is receiving attention of the government in a most serious manner...it is in a very advanced stage of discussion."
Moves to open up the $450 billion retail sector to foreign investment have been pending for years, but Sharma's comments are a strong signal that a decision could be made soon.
"The inter-ministerial consultations have been held and the senior ministers are discussing this," he said.
Sharma's ministry released a discussion paper on opening up the multi-brand retail sector last July, and the issue is being closely watched by retail giants like Wal-Mart, Carrefour and Tesco.
India, Asia's third-largest economy with a population of over 1 billion people, allows 51 percent foreign investment in single-brand retail. Overseas investment in multi-brand retail -- modern supermarkets -- is only allowed in wholesale or cash-and-carry outlets.
Wal-Mart, which runs cash-and-carry stores in India, has said it is ready to open hundreds of retail outlets as soon as the rules are liberalised.
While the move could create jobs and reduce waste, it could drive millions of small shopkeepers out of business.