 "Ikea")
Swedish furniture retail giant Ikea on Tuesday signed an MoU with the Haryana government for an investment of Rs 2,000 crore. Confusion prevailed over the value of the investment promised.
While Ikea maintained that the MoU was for Rs 2,000 crore, Haryana pegged it at Rs 500 crore on its website. The MoU stands for mutual commitment from both parties and intends to provide clarity on working methods and ensure a legally and ethically compliant business environment.
In 2015, Ikea had signed MoUs with Karnataka, Telangana, Uttar Pradesh and Maharashtra to set up stores.
“Haryana is a prioritised state for IKEA due to its open investment climate. The state is investing heavily in technology, infrastructure and skill development. IKEA will set up retail stores to bring high quality, functional home furnishings with affordability and design for the many people. We will expand our supplier base and develop logistical infrastructure for our business,” IKEA India CEO Juvencio Maeztu said.
IKEA said that it is evaluating different sites in the prioritized states of Delhi-NCR, Bangalore, Mumbai and Hyderabad. It had earlier said that it would open its first store in Hyderabad in the second half of 2017.
The company, which received government approval in 2013 for its Rs 10,500 crore proposal to open retail stores under 100 per cent foreign direct investment, plans to open 25 stores by 2025 in nine Indian cities.
To be accessible to the many people, IKEA is looking for store sites with direct access to mass public transport systems, preferably the metro and located near the highway. The size of an IKEA store is about 350,000 sq. ft. IKEA plans to open 25 stores by 2025 and double sourcing from India by 2020, both for Indian and global IKEA stores.
Last year, IKEA India bought its first piece of land in Hyderabad’s HITEC city with the first store opening slated for summer 2017. Construction is slated to begin soon in the coming months.
IKEA’s first store in Hyderabad will be a massive four lakh square feet in size and will include all features of a global IKEA store, including restaurant and play and development area, he added.
In July last year, the company had announced purchase of 13 acre land close to the IT hub in Hyderabad’s HITEC city for the first store.
IKEA has been present in India for 28 years, sourcing for its stores around the world. In India, it currently has around 50 suppliers with about 45,000 direct employees and about 400,000 people in the extended supply chain.
