Reuters Market Eye - The BSE Sensex gained 1.39 percent in early trading, while the Nifty rose 1.46 percent.
India formally opened its supermarket sector to foreign chains and eased foreign investment rules in airlines and broadcasters, the government said on Thursday.
Pantaloon Retail India Ltd rose 6.8 percent, while Trent Ltd was up 4.15 percent.
Despite the current political instability, investors are hoping the government will go through with reforms and that the pace will continue.
Indian financial companies with insurance units surged on hopes the government will increase the foreign direct investment limit to 49 percent from 26 in insurance companies at its next cabinet meeting.
Reliance Capital rose 6.2 percent, while Max India was up 5.5 percent.
State Bank of India was up 1.9 percent, while ICICI Bank gained 2.7 percent.