India likely to open door to Ikea
Furniture retailer's application to set up stores will probably win approval, minister says
India is poised to approve furniture retailer Ikea's application to open stores as the nation seeks to lure more investment, Commerce Minister Anand Sharma said.
"It should go through," Sharma said on Wednesday. "There should not be any doubt in anybody's mind."
Ikea's proposal to invest as much as 42 billion rupees (HK$5.98 billion) in outlets selling items ranging from sofas and cutlery to hot dogs is awaiting a fresh approval from officials. The Swedish chain has sought clarification on whether it can sell the same types of products in India as overseas, posing a test of the nation's commitment to implementing policy overhauls aimed at reviving inflows to boost a struggling economy.
"Our focus is on attracting foreign direct investment," Sharma said. "2012 has not been an easy year for us, and we hope 2013 will be better because the decisions we have taken will lead to an increase in FDI."
Prime Minister Manmohan Singh's government in January 2012 allowed full foreign ownership of stores selling a single brand. Ikea, the world's largest furniture retailer, is seeking to tap demand in the second-most populous nation.
"It is our understanding that we will hear back about the application next Monday," Ikea spokeswoman Ylva Magnusson said on Wednesday. "Until we hear back from them, we cannot comment further."