The Cabinet Committee on Economic Affairs (CCEA) approved Swedish furniture retailer IKEA’s plan to invest Rs 10,500 crore for a single brand retail venture in India, making it the largest investment to be made by a foreign brand in the Indian retail sector.
The approval comes as the final go-ahead for the retail giant to set up shop in the country after it had submitted its application for an India entry early last year. The 25-billion-euro company had received the Foreign Investment Proposal Board’s (FIPB) nod in February this year.
“This is a very positive development…India is an important market for the IKEA Group from a sourcing perspective. We have been active in the country for more than 25 years and will continue to increase our sourcing in India from both existing and new suppliers building on long-term relations and shared values,” said Mikael Ohlsson, president and CEO, IKEA Group. The company said it has growth plans to exceed $1 billion over the next few years with a target of setting up 10 stores over 10 years. While the government has allowed the furniture chain to run cafes and restaurants within its single brand stores, the brand will not be permitted to sell food items inside the stores, commerce minister Anand Sharma had said last month.