Finally there will be some decent foreign direct investment (FDI) with Sweden's retail giant IKEA planning to invest Rs 10,500 crores, in what will be the largest foreign investment in the retail sector. This is of course in single brand retail as FDI in multibrand retail has yet to get the nod from the government.
IKEA has now submitted a proposal to the foreign investment promotion board to set up a 100% subsidiary in India. IKEA is planning to open as many as 25 stores in various cities.
The company will invest Rs 4200 crores in the initial phase and anothers Rs 6,300 crore in the second stage.
However, sourcing goods from small and medium enterprises, which is mandatory is likely to remain a challenge for the company.