IKEA inks MoU with Gujarat to open stores, invest up to Rs 3,000 cr
Swedish home furnishings chain IKEA said it has signed a memorandum of understanding (MoU) with the Gujarat government to set up its stores in the state with an expected investment of up to Rs 3,000 crore in the long term.
IKEA, which received government approval in 2013 for its Rs 10,500-crore proposal to open retail stores under 100 per cent FDI, has earlier signed MoUs with Karnataka, Telangana, Maharashtra, Uttar Pradesh and Haryana to open retail stores. The company plans to open 25 stores by 2025 in nine Indian cities.
The MoU with Gujarat government stands for mutual commitment from both parties and intends to provide clarity on working methods and ensure a legally and ethically compliant, corruption free business environment, IKEA said in a statement.
“Gujarat is a prioritised state for IKEA due to its open progressive policies and positive investment climate,” IKEA India Country Property & Expansion Manager David McCausland said.
IKEA will soon set up its retail stores and other touch points in Gujarat to bring good quality and affordable home furnishings for the many people in Gujarat, he added. Ahmedabad and Surat are the priority cities for now and IKEA has started scouting for suitable real estate, the company said.
The approximate investment in the long term will be around Rs 2,000-3,000 crore. This will generate around 2,000 direct and 3,000 indirect employment, it added.
Gujarat Principal Secretary Manoj Kumar Das said, “IKEA will positively contribute to creating more employment, growth of manufacturing sector, sharing best practices, in skill development and in the overall growth of the home furnishings retail sector.”
Das also assured support to the company for timely implementation of projects and enable smooth business operations.
IKEA had initially stated that it would open its first store in India in Hyderabad in the second half of 2017, which is now expected to be during the summer this year.