Both houses of parliament were forced to adjourn for the day as lawmakers protested against the liberalisation changes announced last week that could see the arrival of large, multi-brand international supermarkets in India.[break]
Anger over the reforms has united small shopkeepers, trade unions, influential state leaders and lawmakers both from opposition parties and from within Prime Minister Manmohan Singh´s ruling coalition.
The all-party meeting on Tuesday, chaired by Finance Minister Pranab Mukherjee to tackle the deadlock, broke up without a deal being reached, and parliament was paralysed by noisy protests against the reforms.
"We have demanded a rollback of the decision," said Sudip Bandopadhyay, a leader of the Trinamool Congress party, one of the largest groups within Singh´s government.
"Such matters should be discussed with (government) partners," he added, highlighting criticism that the reforms were approved by the cabinet on Thursday evening without a parliamentary vote.
The government did not make a statement after the all-party meeting but Bandopadhyay said Mukherjee had pledged to take up complaints with the prime minister.
Mohan Singh, spokesman for the opposition Samajwadi Party, vowed that protests by lawmakers against allowing foreign direct investment (FDI) in the retail sector would continue until the government backed down.
"Without government withdrawing the FDI decision, parliament cannot function smoothly," he told reporters after the hour-long talks.
Commerce Minister Anand Sharma has said modernisation of food processing and packaging would create millions of new jobs, and also end the problem of up to 50 percent of perishable goods produced by farmers never reaching markets.
But opponents say countless small "kirana" stores would be wiped out by large-scale overseas competition.
Foreign multinationals have for years lobbied to sell directly to Indians, and the changes could herald a consumer revolution in the country where most shoppers frequent small, family-run stores.
"A rollback would be a very bad thing, it would send a bad signal to the international community about the potential for investment," said Saloni Nangia, senior vice-president of retail at Technopak, a top Indian consultancy.
"Foreign investors need to be sure of their welcome here before investing," Nangia told AFP.
US-based Wal-Mart, British giant Tesco and France´s Carrefour all broadly welcomed the government´s decision to allow global firms to hold a 51-percent stake in "multi-brand retailers" as supermarkets are known in India.
The sector is worth an estimated $470 billion in annual sales, with high growth potential as India´s 1.2 billion people move towards a more Western-style consumer economy.
Any retreat on the reforms would be a major blow to Premier Singh´s administration, which has struggled for months over charges of indecisiveness amid worsening economic data, high inflation and corruption scandals.
Related story
President Paudel expresses concern over parliament deadlock
