IKEA approaches FIPB, seeks review
Swedish furniture retailer IKEA has approached the Foreign Investment Promotion Board (FIPB) for a second time, seeking a review of its earlier application to open cafeteria at its proposed single-brand retail stores in India.business Updated: Dec 23, 2012 23:26 IST
Swedish furniture retailer IKEA has approached the Foreign Investment Promotion Board (FIPB) for a second time, seeking a review of its earlier application to open cafeteria at its proposed single-brand retail stores in India.
On November 20, the FIPB approved IKEA’s proposal to invest Rs.10,500 crore to open single brand retail stores in India, but pruned the list of items the company wanted to sell.
Besides furniture, IKEA, in its original application, had sought government approval to sell items such as textile products, consumer electronics, leather products, lifestyle products, and food and beverages to be served at its restaurants and cafe.
“IKEA has again sent its application for review, seeking permission to let it open cafeteria at least,” an official source said.
The Department of Industrial Policy and Promotion has forwarded the review application along with its comments in support of IKEA. The FIPB is expected to take up the proposal in the next meeting, said sources.
“So many other foreign companies, which want to open stores in India, are keenly watching the developments in IKEA proposal. The government needs to send a healthy signal on the issue,” said the source.
IKEA, the world’s largest furniture retailer, operates 336 stores in 44 countries. It plans to invest $778 million to set up 10 furnishing and homeware stores as well as allied infrastructure over 10 years.
The company plans to invest $1.7 billion to open 15 more stores and will take around three years to build a supply chain to roll out its first outlet in the country.