India retail sector has grown by leaps and bounds in the recent years. One of the major reasons for such exponential growth is Foreign Direct Investment (FDI) policy of Government of India. Earlier, FDI in retail sector in India was not allowed. But to speed up the growth of retailing in India, the government of India has opened doors to Foreign Direct Investment (FDI) in retail sector. In 2006, the Government eased retail policy for the first time allowing FDI up to 51% through the single brand retail route. Initially, FDI was allowed in some selected sectors only. However in July 1911, the Government of India has recommended 51% FDI in Multi-Brand Retail and 100% FDI in Single-Brand Retail through approval route. In 2018, 100% FDI permitted in Single Brand-Retail through automatic route. This has changed the whole scenario of Indian retail industry in India. In this paper an attempt has been made to study the recent Foreign Direct Investment (FDI) policy in retail and analyze its impact on the growth of retail sector.