India's cabinet on Friday gave the green light for foreign supermarket giants such as Wal-Mart and Tesco to enter the country as part of a blitz of economic reforms, reports said.

International firms will be able to buy a stake of up to 51 percent in multi-brand retailers, said Indian station NDTV. The plan was shelved last year due to fierce opposition from the owners of small shops and opposition parties.

Television channels also said that rules governing foreign investment in the aviation sector had been relaxed and the cabinet had also approved the sale of stakes in some state-owned companies.

The moves follow a 12 percent hike in the price of heavily-subsidised diesel on Thursday night, which some analysts saw as the government signalling its intent to reinvigorate its long-stalled reform agenda.