The government has approved American e-commerce major Amazon's proposed $500 million investment in retailing of food products in India, an official said.
The proposal was pending before the Foreign Investment Promotion Board (FIPB) which has been abolished now.
Hence, the Department of Industrial Policy and Promotion (DIPP) gives the green signal to the proposal.
As per the proposal, the company will open a wholly-owned subsidiary in India to carry out the business. It will stock food products and sell online.
Currently, the government permits 100 per cent foreign direct investment (FDI) in the food processing sector. As per norms, a foreign company can open a wholly-owned subsidiary in India to retail food products produced and or manufactured in the country by way of opening stores or online.
The government had received investment proposals from three companies, namely, Amazon, Grofers and Big Basket worth $695 million for retail of food products.
While Amazon is one of the major e-commerce players in India, Grofers and Big Basket are into online grocery space.