Cafes to cosmetics, Ikea to offer the whole basket
Ikea had sought a review of the decision that was taken by the FIPB in November wherein while approving its first tranche of investment worth Rs 4,200 crore, the board had struck off 18 product categories of the 30 proposed and refused permission to the company for opening signature cafes and restaurants in the stores. The board said Ikea could not sell items such as home and office-use products, textiles, apparel and fabric, electronic items, leather products, toys, books and lifestyle and travel-related items.
Ikea then approached the industry department, which forwarded the request to the FIPB seeking a review of its November 20, 2012, decision.
Subsequently, the FIPB deliberated on the representation at its meeting on December 31, 2012 and sought clarifications from the company. Once the FIPB clears the company’s proposal, it will go to the Cabinet Committee on Economic Affairs (CCEA) as is the norm for all foreign investment proposals exceeding Rs 1,200 crore.
The government in September 2012, relaxed a provision requiring single brand retailers to source at least 30 per cent of their requirements from small and medium enterprises, modifying rules to say it was “preferable” rather than “mandatory”. Ikea will operate in India through its wholly-owned subsidiary Ingka Holding Overseas BV