The talks came as Indian business Bharti Enterprises was preparing to reveal its preferred retail partner. Bharti is keen to link up with Tesco.
At present, multibrand foreign retailers are prevented from opening on their own in India, although this is not the case for wholesalers.
The Indian Chamber of Commerce picked up on this point when it urged Tesco to enter the Indian wholesale market in order to ensure it didn't miss out to German rival Metro.
Indian Chamber of Commerce secretary general Amit Mitra told Reuters: 'This is where Tesco has to go in; because if Metro is already there with its feet on the ground, when India's retail market opens up they will really be able to spurt.'
This move coincided with a call from India's most powerful businessman for foreign supermarkets to be allowed in by Dr Singh's government because they would 'contribute to the economy hugely'.
Reliance Industries chairman Mukesh Ambani said: '[This] would keep local companies on their toes.'
Meanwhile, it was reported in India today that the world's largest retailer Wal-Mart was in talks with mall owner DLF to sign a franchising deal. Along with French company Carrefour and Tesco, Wal-Mart is also understood to be in talks with Bharti Enterprises.