Tesco has refused to comment on speculation it is scouting out the Algarve as part of its international expansion plans.

The rumours emerged after an ex-pat newspaper in the region claimed Tesco had earmarked 17 sites in the Algarve for Express, superstores and Extra stores. It said stores could begin to open in a year and Tesco also had its sights on Spain and Italy.

This week, reports of Tesco doing a deal with Italian supermarket chain Esselunga were quashed after its chairman Bernado Caprotti said there had been no contact, describing the companies as incompatible. A Tesco spokeswoman said of these reports: "We wouldn't comment on rumour or speculation."

However, an announcement is expected imminently that will clarify Tesco's plans for India.

Telecommunications giant Bharti Enterprises has confirmed it is talking to a number of international retailers - of which Tesco is one - about a joint venture. The deadline for conclusion of the talks was

this week.

In the US, Tesco has submitted plans for a 14,000 sq ft store in Redlands, California, following an application for a 32,000 sq ft store last month.