Scandinavian home products giant, Ikea, which has expressed reservations over the 30% sourcing clause from Indian SMEs, will again come to India and lobby for an easy entry into the Indian market early next month. Sources say Ikea CEO Mikael Ohlsson met commerce and industry minister Anand Sharma in Europe last week had promised a visit with his team. The team will furnish details if it would like to enter Indian market or not, given current riders on the policy of allowing 100% foreign direct investment in single brand retail trading.
Ohlsson who had met Sharma in Paris had expressed that the company is willing to be involved in strengthening of SMEs in India but also added that sourcing clause is tough to cater to. ?He (Ohlsson) told the minister that India is an important market and Ikea would like to be involved in strengthening of SMEs in India,? a commerce and industry ministry statement said.
Sources said Ikea will also soon be charting structural changes in the Indian operations team to cater to the specific and circumstantial requirements of India. FE had reported in November last year that strict riders
like a minimum 30% sourcing from SMEs will be a roadblock for foreign retailers to enter the Indian market under single brand retailing.
It was earlier last month the government had notified opening of 100% FDI in single-brand retail, with a clause of 30% mandatory sourcing from SMEs. In November, Ikea was about to announce foray into India but had to defer the decision in the aftermath of political row over the government?s decision to relax FDI norms in retail, including 51% in multi-brand retail.
The euro 25-billion Ikea group, the largest furniture retailer in the world, operates 287 outlets across the world. It is a privately held home product company that sells ready-to-assemble furniture. The company since last three years has been in a dialogue with the government on easing the policy restrictions. Ikea had tried to enter India earlier too, but had dropped the plans subsequently as it wanted to come on its own.
