New Delhi: With the government relaxing the sourcing norms for FDI in single-brand retail, Swedish furniture and home furnishing chain IKEA on Monday said it has filed the final document this week seeking permission to open its store in India.
"IKEA Group views the recent developments related to single brand FDI in retail positively. We believe the current policy guidelines support the business needs of many single brand retailers and will benefit consumers as well as the development of many suppliers and producers in India," IKEA group President and CEO Mikael Ohlsson said in a statement.
Last month, the government had tweaked sourcing norms for FDI exceeding 51 percent in single-brand retail and diluted the previous condition of sourcing 30 percent of requirements "mandatorily" from micro, small and medium enterprises (MSMEs) in India by stating that sourcing should be done "preferably from MSMEs".
This was one of the major issues raised by IKEA while approaching the government in June this year with its plans to invest 1.5 billion euro (Rs 10,500 crore) in India to set up 25 stores.
"After 25 years of sourcing many IKEA products in the country, IKEA Group has, as of end June this year, submitted its application to start retail operations in India and has filed the final document this week in accordance with the amended policy," Ohlsson said.
Without specifying a timeline for opening its first store in India, he said: "Once our application is approved we will develop a solid plan for the establishment of IKEA stores for many years to come, generating investments and new employment."
Stressing that India is an important market for IKEA, both from a retail and a sourcing perspective, Ohlsson said: "We will continue to increase our sourcing in India from both existing and new suppliers building on long-term relations and shared values."