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

Courtesy: Myntra

Apparel/Garments | On 3rd Dec 2016

Myntra to be EBITA positive by FY18: CEO Narayanan

Myntra is on track to achieve sustainable growth and be EBITA...

Courtesy: India ITME Society

Textiles | On 3rd Dec 2016

India ITME 2016 opens with over 1050 exhibitors

The India International Textile Machinery Exhibition (India ITME)...

Courtesy: Bruckner

Textiles | On 3rd Dec 2016

Indian textile companies opt for Brückner stenter lines

Indian textile firms Laxmipati Sarees, makers of polyester sarees and ...

Interviews View All

Saket Garg
Garg Corporation

The biggest challenge is lack of skilled workforce and competition from...

Vidhyaa Shankar. S
A Ganapathi Chettiar

'The usage of knits is getting into the boundaries of woven fabrics'

Amardeep Singh
Orient Craft

'In export markets, the trend in terms of embroidery, is towards matte...

Giorgio Mantovani
Corman S.p.A

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

Johan Berlin
InvestKonsult Sweden AB

Investkonsult Sweden AB has been buying and selling second-hand textile...

Ashok Desai
Bombay Textile Research Association

Bombay Textile Research Association (BTRA) is a leading name in textile...

Silvia Venturini Fendi
Fendi s.r.l

"Yes, my confidence and positive attitude are my strengths and should be...

Igor Chapurin
Chapurin

"Now we can see the Russian trend in international fashion. And Russian...

Prathyusha Garimella
Prathyusha Garimella

Hyderabad-based designer Prathyusha Garimella is known for blending...

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
December 2016

December 2016

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

SUBSCRIBE


Browse Our Archives

GO


Advanced Search