FDI POLICY MAY BE TWISTED FOR IKEA
IKEA is a Swedish single brand retailer. Government of India may twist the foreign direct investment policy for IKEA. This retailer proposed to invest 10,500 crore in India.
IKEA has demanded some flexibility in the clause that makes it mandatory to source 30% of inputs from domestic SMEs(Small and Medium Enterprises). IKEA is the world’s largest furniture maker.
Government has increased the FDI cap in single brand retail from 51% to 100% subject to domestic sourcing clause. The Departments that frames policy of FDI i.e. Department of Industrial policy and promotion (DIPP), has clarified that they won’t be reviewing FDI policy on case to case basis rather they will be reviewing policy in general.
Presently IKEA has 70 Suppliers and 1450 Sub Suppliers in India.
Hope to see more FDI in India after revision of FDI Policy.