FIPB approves H&M's Rs 720-cr proposal

Vodafone's Rs 10,141-crore plan not considered

The Foreign Investment Promotion Board (FIPB) on Wednesday approved Swedish clothing major Hennes & Mauritz AB (H&M)’s proposal to open 50 stores across the country. The proposal involves an investment of Rs 720 crore.

However, FIPB did not take up British telecom giant Vodafone’s Rs 10,141-crore proposal to raise stake in its Indian arm, as it didn’t receive inputs from all the entities concerned. Key entities whose comments are required for the proposal to go through include the Department of Telecommunications, the Department of Economic Affairs, Department of Industrial Policy and Promotion (DIPP)  and the home ministry.

H&M’s proposal was cleared by DIPP, the nodal agency for foreign direct investment (FDI), in September. In April, the company had presented an application to enter the country’s single brand retail market.

According to its application, H&M, endorsed internationally by the likes of supermodel Gisele Bundchen and footballer David Beckham, would invest ^100 million in the first phase, through a wholly-owned subsidiary.

Earlier, DIPP had questioned whether the company would be able to strictly adhere to the sourcing norms dictated by the FDI policy in single-brand retail. The department was also concerned about the brand’s licensing norms. Stockholm-based H&M had replied to all these queries, putting the concerns to rest.

The apparel company is already believed to be in advanced stages of negotiations to book 25,000 sq ft at a major mall here.

The brand operates 3,000 stores in 53 markets around the world, including the popular outlet at London’s Regent Street.

Earlier this year, the Cabinet Committee on Economic Affairs had cleared a Rs 10,500-crore proposal by furniture-maker IKEA, a Swedish brand registered in The Netherlands.