Wal-Mart in India?
It could happen...
Investors and prospective investors in Wal-Mart (NYSE: WMT) shouldn't be blamed if they don't pay much attention to what's happening in the world of Indian politics. After all, the country is half a world away, and Wal-Mart currently has just two stores in the country. Yet the reason Wal-Mart has not made more significant in-roads into India is because current Indian government policy prohibits foreign companies from operating independent retail stores -- a policy that aims to protect small-scale Indian business owners.
Recent rumors out of New Delhi, however, have the government there considering changing that policy due to food inflation of more than 16% this year. It's been exacerbating India's poverty problems and undermining popular satisfaction with the government. The hypothesis is that by allowing efficient, price-focused retailers such as Wal-Mart to enter the market, those retailers can help force prices down and still provide employment for Indians.