The government on Tuesday allowed 100% foreign direct investment (FDI) in single-brand retail, paving the way for marquee brands such as Prada, IKEA, GAP and sports goods majors to set up exclusive outlets in India. The outlets will be owned and managed entirely by them.
"The government has decided that FDI up to 100% would be permitted in Single-Brand Product Retail Trading, subject to specified conditions," a department of industrial policy and promotion notification said.
This means that although global supermarket giants such as Walmart, Tesco and Carrefour may not be able to set up deep-discount stores in India yet, others such as iconic furniture brand IKEA and apparel retailer GAP — ones that sell just one brand under their roofs — will gain entry.
"This step will provide stimulus to domestic manufacturing value addition and help in technical upgradation of our local small industry," said commerce and industry minister Anand Sharma.
The move comes a month after the government had to withdraw its decision to allow 51% FDI in multi-brand retail.