• Sweden edition
Ikea puts India expansion plans on ice

Ikea puts India expansion plans on ice

Published: 23 Jan 2012 14:14 GMT+01:00
Updated: 23 Jan 2012 14:14 GMT+01:00

Swedish furniture retailer Ikea has put off plans to open stores in India due to local sourcing requirements despite a recent loosening of rules about foreign ownership of single brand retailers.

Speaking with the Financial Times (FT) newspaper, Ikea CEO Mikael Ohlsson said that rules stipulating that single-brand retailers source 30 percent of their goods from local companies remained a stumbling block to Ikea's plans for expanding into India.

“We need to see what [the rules] will mean for us,” Ohlsson told FT.

“We are patient because the conditions need to be right. In this sector, when everything seems to be okay, then we will be in.”

Nevertheless, Ohlsson said a recent change allowing foreign ownership of single-brand retailers was “a very positive change”.

Back in 2009, Ikea cited a rule preventing stores being 100 percent foreign owned as the primary reason for the company putting off plans to open stores in India.

Regulations at the time capped foreign investment in single-brand retailers at 51 percent.

Earlier this month, however, the Indian government agreed to allow foreign companies to own 100 percent of single-brand retailers.

Despite the move, Ikea's Ohlsson remained cautious about when the Swedish retailer may eventually open outlets in India.

“We have always been cautious. Now we will take a step-by-step investment in existing stores,” he told FT.

According to the newspaper, Ikea plans to source €1 billion of its global product range from India within three years, doubling the current amount.

Last week, Ikea reported record profits due in part to fast growing sales in China and Russia.

Currently, Ikea operates furniture stores in 26 countries around the world.

Related links:

The Local/dl (news@thelocal.se)

Don't miss...X
Left Right

Your comments about this article

15:05 January 23, 2012 by Puffin
Well here are counties of Sweden that they might consider expanding into first

- Dalarna for example!
15:07 January 23, 2012 by cupidcub
Go to Bangladesh! They will not disappoint you.
17:11 January 23, 2012 by Fernandis
Bangladesh----they need food not IKEA.
18:05 January 23, 2012 by Dazzler
Hey Puffin...Borlange will be getting an Ikea this year,if I remember what the wife told me, she works as a store designer for Ikea.
18:38 January 23, 2012 by Munmun30
IKEA is not sure about entering India with the 30% sourcing restriction, is because they are now manufacturing almost everything in China. The 30% restriction is very good, 'coz it will force companies to invest in India, build up manufacturing units, bring in international standards.

Of course IKEA does not want this, so that they can just dump all they get manufactured in China into India.
20:21 January 23, 2012 by gabeltoon
Why is it that everything we use in the western world is made in CHINA or INDIA.???
16:06 February 7, 2012 by Navras
India should only those companies to invest,do business in india ;who want to invest and buy from local supplier.

If they want to follow Indian rules,they are invited!
Today's headlines
'Imperfect EU better than revolting nationalism'
Fredrik Reinfeldt. File photo: TT

'Imperfect EU better than revolting nationalism'

Swedish Prime Minister Fredrik Reinfeldt on Wednesday urged young voters to head to the European parliamentary polls on May 25th "to cure the European disease of nationalism". READ () »

Ericsson quarterly profit defies sluggish sales

Swedish telecom giant Ericsson on Wednesday announced a drop in sales but posted a sharp rise in first-quarter profit, which nonetheless fell shy of analyst predictions. READ () »

Fatal Norrköping brawl
Four brothers held as cops fear brawl reprisals
Photo: Johan Nilsson/TT

Four brothers held as cops fear brawl reprisals

Swedish police fear that several people involved in a brawl in eastern Sweden on Monday night may be seeking revenge after two brothers were shot dead. READ () »

Sponsored Article
Beautiful pearls of southeast Sweden
The town of Västervik.

Beautiful pearls of southeast Sweden

Ask a Swede, and they are likely to say that their favourite holiday spot is in the southeast of Sweden. Eastern Småland and Öland offer a smörgåsbord of all the things dearest to the Swedes - from the beloved children's book author Astrid Lindgren to deep forests, long sandy beaches, perfect spots for that all-important 'fika', and a surprising amount of space, peace and quiet. READ () »

Weekend weather to bring summer warmth
Swedes enjoy hot dogs and cherry blossoms in Stockholm's Kungsträdgården. Photo: Jessica Gow/TT

Weekend weather to bring summer warmth

The sun is set to stick around and temperatures could climb into the twenties over the weekend, Swedish meteorologists said on Wednesday READ () »

Swedes open coffin of 850-year-old king
Erik the Holy's skull and the crown, believed to be Sweden's oldest. Photo: Bertil Enevåg Ericson/TT

Swedes open coffin of 850-year-old king

King Erik the Holy died 854 years ago, but scientists have just unveiled his skull at Uppsala Cathedral. READ () »

'Day-care rapist' admits molesting eight kids

'Day-care rapist' admits molesting eight kids

A 21-year-old man confessed on Wednesday to sex crimes against eight children at a day care where he was working as an intern. READ () »

Swedish cops nab man for having big muscles
An unrelated bodybuilder. File photo: Ann Törnkvist

Swedish cops nab man for having big muscles

Police in Sweden's south who hauled a muscular man in for steroid testing have had their knuckles rapped, after it was ruled that big biceps cannot be grounds for narcotics suspicions. READ () »

Swedish girls report more eating problems
Teen girls. File photo: Chloe Chaplin/Flickr

Swedish girls report more eating problems

A youth wellbeing report from Save the Children found that more teenage girls than in previous surveys reported having an eating disorder. READ () »

'Zlatan will be back for finals': PSG coach
Photo: AP

'Zlatan will be back for finals': PSG coach

Paris Saint-Germain coach Laurent Blanc said on Tuesday that he believed Swedish goal machine Zlatan Ibrahimovic will play again before the end of the season. READ () »

Sponsored: South-eastern Sweden offers Öland beaches and more
Swedish underwear shop puts staff in front of the camera
IN PICTURES: The Local's Property of the Week - Täby
Sponsored: India+Sweden Week - India Unlimited
Sponsored: India+Sweden Week - A film, food, and finance feast
University applications rocket to record high
People-watching April 18-20
Kids in Victorian garb mark Swedish Easter
Swedish MP ordered chemtrail probe
Swedish supermarket Ica pulls contested Easter commercial off air
Swedish royals set baptism date for princess
People-watching April 16
Who's the prime minister's heir?
Alfie Atkins
Are children's books the key to families integrating in Sweden?
'Sweden Dem protests cater to party's martyr image'
'Swedish research grants were fantastic, but now it's like Australia'
Only in Sweden: The ten problems you'd never encounter elsewhere
Swedes stopped to take my picture, but didn't look me in the eyes
Business & Money
A swipe of the hand replaced cash and cards in Lund
Video: Oliver Gee finds out how to embrace The Swedish Hug
Abba duo hints at reunion
Flash mobs hug it out across Sweden
People-watching April 11-13
Swedes to give six-hour workday a go
Stockholm School of Economics
Sponsored Article
Why a bachelor's degree is no longer enough
Latest news from The Local in Switzerland

More news from Switzerland at thelocal.ch

Latest news from The Local in Germany

More news from Germany at thelocal.de

Latest news from The Local in Spain

More news from Spain at thelocal.es

Latest news from The Local in France

More news from France at thelocal.fr

Latest news from The Local in Italy

More news from Italy at thelocal.it

Latest news from The Local in Norway

More news from Norway at thelocal.no

Blog Update: The Diplomatic Dispatch

28 October 15:16

The Green Growth Group Summit »

"Today on the 28 October in Brussels, a large group of key EU Ministers and business people, including UK Secretary of State for Energy and Climate Change Edward Davey, and Swedish Environment Minister Lena Ek, will meet to discuss green growth. They all have a stake in resolving a challenge which, although it is crucial..." READ »

jobs available
Swedish Down Town Consulting & Productions
Swedish Down Town Consulting & Productions is an innovative business company which provides valuable assistance with the Swedish Authorities, Swedish language practice and general communications. Call 073-100 47 81 or visit: