Single Brand Retail
By UK India Business Council (UKIBC)
IKEA’s landmark decision last month to invest Euro1.5 billion (Rs 10,500 crore) over a period of 15-20 years to open 25 stores across the country was applauded by the Indian government as a definite sign of global investor confidence in the Indian market.
Single Brand Bonanza
This promises to be the largest ever investment into single brand retail in India, far surpassing the total FDI inflow of £30 million in single brand retail between April 2000 and April 2012.
Despite the Swedish furniture major’s ongoing dispute with the government over sourcing regulations which could potentially become a sticking point, there is a general sense of optimism that IKEA’s investment will go a long way in revitalizing the flagging India economy.
Not only that, it seems to have sparked off a spate of fresh foreign brand investment as other international retailers have started flooding in – with FDI commitments of over £1 billion in the single brand retail sector. Over the last three to four months, the Department of Industrial Policy and Promotion(DIPP) has received a slew of overseas applications from brands including Pavers England, Skechers, Quicksilver, Tommy Hilfiger, Brooks Brothers, Promod, and Starbucks, all of whom have filed for either joint ventures or fully-owned subsidiaries with the DIPP.
