Foreign supermarket chains are wary of setting up shop in India despite the government announcing it would open its doors to investment by multi-brand retailers from overseas.
Continued opposition and concerns surrounding the profitability and ease of operating in the country are among the factors holding back foreign grocers from rushing in to establish themselves in India, analysts say.
"There are quite big hurdles," says Ankur Bisen, the vice president of retail for Technopak, a consultancy in India.
"Realisation has started to seep in. The initial exuberance has been replaced by cautious optimism. International retailers are saying, 'OK, you've allowed FDI [foreign direct investment] into retail but how do I make money?'"
India in September announced a reform to allow up to 51 per cent foreign direct investment in supermarket chains, along with a slew of policy decisions designed to boost foreign investment and spur India's slowing economic growth.
The move has been praised by economists and investors who cite job creation, less waste and lower prices as being among the main benefits. Opponents, meanwhile, have decried the decision, arguing it would destroy many of the "mom and pop" stores that are so prevalent in India.
Conditions for entering the Indian market "are tougher compared to other markets", says Dame Lucy Neville-Rolfe, the corporate and legal affairs director at the UK supermarket chain Tesco, speaking at the World Economic Forum in India.
"We are still evaluating the Indian market. We clearly need to study the conditions," Dame Neville-Rolfe said, according to local reports.
"We very much understand where the government is coming from, in wanting to ensure that these changes encourage growth in the supply chain and other factors."
There are a number of fundamental problems in the industry, which is heavily fragmented with a supply chain that involves farmers, distributors, retailers and various middlemen along the way, complicating the process of sourcing produce, according to analysts.
"The issues that remain in the value chain don't get resolved," says Mr Bisen
"We have an inefficient system of distribution; we have an inefficient system of sourcing; we have an inefficient system of retailing. To make them efficient, you need reforms in agriculture, reforms in taxation," he says.
"The problem is that most of these issues have a political stance. Fundamental reasons around multi-brand retailers not jumping for joy are state issues - access to real estate, taxation."
Analysts at KPMG agree the cost of land and property is challenging.
"One of the important factors cited for the viability of retail business is the availability of real estate at affordable prices and at suitable locations," KPMG says in a recent report. "Major Indian cities with retail penetration have witnessed a considerable increase in rentals in the last five years."
"Traditionally, retail has been a difficult terrain for most global retailers," KPMG adds. "Whenever global retailers have ventured out of their base country, their chances of success have reduced considerably. For example, Wal-Mart had to wind up its operations in Germany and South Korea; similarly, Best Buy had to retreat from China."
"FDI approval will be a positive for retailers, as they will now have access to much-needed capital but it may not spur growth," says the international financial services firm Macquarie. "Even well-funded business groups have not been able to grow their retail businesses rapidly." Meanwhile, FDI into retail is expected to come into focus in the winter session of parliament, which starts this week, with the Left parties fiercely opposing the reform and saying they want to vote on the issue.
While many store owners in India are opposing the reform, with a number of them staging protests and strikes after the announcement, others do not feel threatened.
"Supermarkets require a huge space," says Arvindo Fernandes, who runs a small shop called Frigi Fresh in Colaba in Mumbai.
"They can only go to the outskirts because Mumbai is so cramped up with buildings.
"We're doing home delivery of one or two items and if customers come and they don't have money, they can pay the next day. Wal-Mart cannot do this."