Swedish furniture giant IKEA said that it has filed final documents to start its retail venture in India after the government amended the policy on singlebrand retail. IKEA, in its earlier application, had planned to invest 1.5 billion euros (around Rs 10,500 crore) in a singlebrand retail venture. In the first phase, it had planned to set up 25 stores with an investment of 600 million euros.
But it wanted clarity on sourcing rules. After months of wait, the government announced the policy for singlebrand retail and diluted the sourcing norms to enable IKEA to set up shop in the country. India has allowed 100% FDI in single-brand retail, and 51% in multi-brand retail.
Mikael Ohlsson, president and CEO of IKEA, said India is an important market for IKEA, both from a retail and a sourcing perspective.
The IKEA CEO said once the company’s application is approved it will develop “a solid plan for setting up IKEA stores”, which will generate investments and new employment. “We know that many people are eagerly waiting for the first IKEA store to open in India. At the same time, we will continue to increase our sourcing in India from both existing and new suppliers building on longterm relations and shared values,” added Ohlsson.
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