Home / Knowledge / News / Textiles / Ikea puts off India plan over local sourcing clause
Ikea puts off India plan over local sourcing clause
27
Jan '12
Ikea, the Swedish retailer of homeware items, including home textiles, has put aside its plan to open its outlets in India.

According to the notification issued by the Government of India earlier this month, allowing 100 percent foreign direct investment (FDI) in single-brand retail segment, companies investing more than 51 percent are required to source at least 30 percent of their goods from domestic small and medium enterprises (SMEs).

However, Ikea's opting out of entering Indian market over the 30 percent local sourcing clause has come as a surprise to many.

Companies like Ikea are already sourcing about 30 percent of their requirements from India and hence, the clause should not be a hurdle to such foreign brands wanting to set up their shops in India, an expert said.

Mikael Ohlsson, Ikea CEO, said the Government of India's decision to permit full ownership of operations to single-brand foreign retailers in India is “a very positive change”, but it would be easier for food retailers to meet the domestic sourcing clause rather than single-brand retailers who have established, international range of products.

Ikea spokesperson said the company has found that the clause related to local sourcing from SMEs would be difficult for it to meet.

Several foreign retail brands, including Wal-Mart, Tesco and Carrefour, have been sourcing items like rugs and textiles from Indian firms for many years. These brands also intend to open outlets in India, considered to be the third largest retail market in Asia.

Fibre2fashion News Desk - India


Must ReadView All

Textiles | On 27th Jun 2017

Govt defers tax deduction at source provision under GST

E-commerce players in India will not be required to deduct tax on...

Apparel/Garments | On 27th Jun 2017

Future Group aims Rs 12,000 crore in fashion business

Future Group, which runs retail stores across India under various...

Textiles | On 27th Jun 2017

AEPC & NSDL to help exporters with GST compliances

Apparel Export Promotion Council (AEPC) and National Securities...

Interviews View All

Mandeep Nagi
Shades of India

Women value something that is unique and has a flavour of India

Viral Desai
Zenitex Mill Pvt Ltd

Full of green energy

Ghanshyam Ghoghari
Kimora Fashion

Bridalwear is not about reds and whites anymore

Lynda Kelly
Suominen Corporation

Suominen Corporation is a manufacturer of nonwovens as roll goods for...

Eamonn Tighe
Nature Works LLC

Eamonn Tighe, Fibres and Nonwovens - Business Development Manager of...

Giorgio Mantovani
Corman S.p.A

Giorgio Mantovani, MD of Corman, with a presence in both Milano and New...

Sanjukta Dutta
Sanjukta's Studio

<b>Sanjukta Dutta</b> creates unique garments by clubbing prints of...

Sonam & Paras Modi
SVA

Sonam and Paras Modi's Sva Couture is synonymous with head-turning...

Aditi Somani
Aditi Somani

Aditi Somani specialises in luxury fusion wear with international cuts and ...

Press Release

Press Release

Letter to Editor

Letter to Editor

RSS Feed

RSS Feed

Submit your press release on


editorial@fibre2fashion.com

Letter To Editor






(Max. 8000 char.)

Search Companies





SEARCH

news category


Related Categories:
July 2017

July 2017

Subscribe today and get the latest update on Textiles, Fashion, Apparel and so on.

SUBSCRIBE


Browse Our Archives

GO


E-News Insight
Subscribe Today and Get the
Latest News Update in Your Mail Box.
Advanced Search