Sweden’s IKEA,the world’s biggest furniture retailer,is withholding its entry into India because of rules applied to sourcing local products,said chief executive Mikael Ohlsson.
Ohlsson is cited as saying India’s requirements that single-brand retailers source 30 per cent of their goods from local small and medium-sized companies was an obstacle to its investment,and that needed reviewing.
Ohlsson said New Delhi’s move to open its market to foreign retailers was very positive,but added that he feels the conditions applied to local sourcing were concerning.
IKEA is seeking clarity on restrictions imposed on entry to India,one of the most promising consumer markets,according to Ohlsson.
We need to see what [the restrictions will mean for us. We are patient because the conditions need to be right. In this sector,when everything seems to be okay,then we will be in,Ohlsson is quoted as saying in the article.
Earlier this month,India formally eliminated restrictions on foreign investment in its single-brand retail sector,allowing firms such as IKEA to open stores in Asia’s third-largest economy.