India has the world's second-largest population. In 2006, it reached 1.1 billion. It also has the youngest population, with half under the age of 25

By 2015, 90 million households - or 450 million people - will be earning at least £1,000 a year, according to India's National Council of Applied Economic Research, up from 50 million households now

Despite the growing affluence of the Indian middle class, price is still the deciding factor in consumer purchasing habits. Retailers use promotional packs - undercutting the maximum retail price - and bogofs to attract price-conscious consumers

Some 87% of the retail opportunity comes from the top 25 cities in India

Delhi alone presents a retail potential of 800 billion rupees (£9.3bn)

Hyderabad is the fastest-growing city, with a retail opportunity of 310 billion rupees, close to that of Kolkata (Calcutta), despite having half the number of households

Indian investment

Foreign investment in the Indian retail industry is a contentious issue. Currently, single-brand retailers can own 51% of a business. Multi-brand retailers can only invest if they form a joint venture with a local company, franchise out their stores or operate in the wholesale sector.

The government recently made positive noises about easing restrictions, particularly with regard to certain sectors such as sports goods - perhaps with an eye on the Commonwealth Games coming to Delhi in 2010. But opposition groups reacted strongly and policy changes are again on the back burner.

In response to concerns about the impact of Foreign Direct Investment on local industry, commerce minister Kamal Nath set up a committee to study the impact of FDI on the rural economy in India.

"There have been positive vibes in the past few months about FDI, but this report is likely to put a stop to everything for now," says Soumya Palchoudhuri, retail analyst at Ernst & Young.

Many think it is only a matter of time. "The government is opening up select areas," says Shyamak Tata, partner at Deloitte in Mumbai. "Internal politics means the pace is slow, but in 10 years' time the market will no doubt have opened up completely, so it makes sense for retailers to enter via the back end - through joint ventures - so that when it does they are ready to go."