This photograph taken on August 6, 2007 shows India's Bharti Enterprises managing director Rajan Bharti Mittal (L) shaking hands with Raj Jain, president of US company Wal-Mart's operations in India, during a press conference in New Delhi.
MUMBAI: Global retail giant Walmart and Indian firm Bharti said on Wednesday they were ending their partnership in the country's retail sector and would now operate separate businesses.
The companies said in a joint statement that they would "discontinue their franchise agreement in the retail business" in India and would "independently own and operate separate business formats".
Walmart has said it wants to operate supermarkets in India after New Delhi moved last year to open up the retail sector to foreign companies in a bid to boost the sharply slowing economy.
But the world's biggest retailer has been frustrated by the government's conditions for foreign investment, and the faltering relationship with Bharti, owner of India's top mobile phone firm.
Walmart has operated since 2007 in India as a wholesaler via its partnership with Bharti, but it is unable to sell directly to consumers.
Walmart had said in 2012 it wants to launch its first store in India within two years, but the company needs a local partner, and it is yet to make a proposal to the government for opening retail stores.
Walmart said in July that it was unable to meet requirements stipulating that 30 percent of its products must come from local small-scale industries for it to open stores.
Last year, New Delhi allowed foreign supermarkets to establish 51-percent joint ventures in the country as part of the government's drive to seek outside investment to boost the economy, but so far none has applied.
India's opposition lawmakers in the past have expressed concern over Walmart's entry, saying it will hurt local "mom and pop" stores.
Under the terms of the breakup, Walmart will acquire Bharti's stake in the wholesale cash and carry business, giving it 100 percent ownership, the statement said.
"Given the circumstances, our decision to operate independently will be beneficial to both parties," Scott Price, president and chief executive of Walmart Asia said in the statement.
Price said Walmart would "continue to advocate for investment conditions that allow FDI (Foreign Direct Investment) multi-brand retail in India". (AFP)