Multi-brand retail FDI to tame inflation:Moily

New Delhi: Corporate Affairs Minister Veerappa Moily today said foreign investment in multi-brand retail will help improve supply and tame inflation.

"It (FDI in multi-brand retail) will help to tame inflation and (promote) growth rate. A good, systematic supply chain will help in bringing down inflation and help farmers," Moily told reporters on the sidelines of a CII event here.

Paving the way for global giants like WalMart to open mega stores in the country, Cabinet yesterday approved 51 per cent foreign direct investment (FDI) in multi-brand retail.

Moily noted there is a "need to prepare a huge supply chain under multi-brand retail".

The Cabinet also decided to allow 100 per cent FDI in the single-brand retail format under which companies in the food, lifestyle and sports business run stores.

The government has maintained that farmers will get higher remuneration and FDI will help in the development of logistics and cold chains in the country.

However, there is stiff opposition to the move from BJP, CPI(M) and the UPA`s key ally Trinamool Congress, who argued this would create unemployment and adversely affect thousands of traders in the retail sector.