New Delhi: The Cabinet Committee on Economic Affairs (CCEA) is likely to take up Swedish home furnishings retailer IKEA's Rs 10,500 crore investment proposal for consideration during first week of April.
According to a senior government official, the Department of Industrial Policy and Promotion (DIPP) is currently evaluating the FDI proposal, which was earlier cleared and forwarded by the Foreign Investment Promotion Board (FIPB).
"FIPB has sent the minutes to DIPP. The DIPP will send these to the CCEA next week and in first week of April, it is expected to be taken up by the CCEA," the official said.
FIPB can clear foreign investment proposals worth up to Rs 1,200 crore. As IKEA's planned investment is higher than this, the proposal has to be cleared by the Cabinet.
Earlier in January, FIPB had cleared the Rs 10,500-crore investment plan of IKEA to open single-brand retail stores.
Last year, IKEA was given permission to invest only Rs 4,200 crore by the FIPB. However, following only a part approval to its investment plans, the company took up the issue with industry department that in turn asked the Board to reconsider the decision.
CCEA will now have to clear the total proposal of Rs 10,500 crore of the Swedish company that includes stores and cafeterias.
In its application, IKEA had proposed to invest the amount for setting up 10 furnishing and homeware stores as well as allied infrastructure over 10 years in India. Subsequently, it plans to open 15 more stores.
IKEA's would be the largest investment in the single-brand retailing ever since the government has allowed foreign investment in this sector. IKEA has been sourcing many products from India for the past 25 years.
First Published: Friday, March 22, 2013, 19:38