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INDIA

India seals Ikea’s emerging-market push

The Indian government on Thursday approved a plan worth almost $2 billion by Swedish furniture giant Ikea to open stores in India for the first time, officials said.

Published: 3 May 2013 08:19 CEST
India seals Ikea's emerging-market push

Ikea’s plan to invest in India was approved in a cabinet meeting headed by Prime Minister Manmohan Singh, according to officials.

The Swedish firm, which submitted its application last June, hopes to open 25 stores in India through a 100-percent owned unit called Ingka Holding. It comes as part of a wider push into emerging markets such as China and Russia.

“The Cabinet Committee on Economic Affairs today gave its approval to the proposal of Ingka Holding as recommended by the Foreign Investment Promotion Board (FIPB),” a government statement said.

“The approval would result in foreign direct investment inflows amounting to 105 billion rupees ($1.95 billion) approximately into the country,” it added.

Ikea’s entry into India is being closely watched as a test case for how a large foreign corporation might negotiate India’s notorious red tape.

Ikea in a statement described the cabinet decision as a “big step in our journey to open Ikea stores in India”, according to the Press Trust of India.

“We feel very confident that the people of India will love to visit and to shop at Ikea,” the company’s Indian chief executive officer Juvencio Maeztu said in the statement after the government’s final nod.

The company will offer “good quality home furnishing products and solutions at affordable prices”, Maeztu added.

The FIPB gave the plan the green light in January, two months after it had rejected 15 of Ikea’s 30 product lines, including food and textiles.

Ikea says it sees a huge potential in India’s ready-to-splurge burgeoning middle class.

It was not clear on Thursday whether the original FIPB limitations on food and products remained in place as part of the new deal.

Ikea had previously told New Delhi the company must be allowed to retain its “global model” in India, retailing all of its products and running its in-store restaurants as it does in every country in which it operates.

The new deal comes after Ikea scrapped plans to enter the market in 2009 due to regulatory concerns.

Singh’s government announced a string of pro-market and investor-friendly reforms that relaxed or removed barriers to foreign retailers in September 2012.

AFP/The Local/at

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WEATHER

Danish Ikea store shelters staff and customers overnight during snowstorm

Heavy snowfall left 31 people looking for a spare cushion at the Aalborg branch of Ikea on Wednesday as they were forced to spend the night at the store.

Published: 2 December 2021 09:11 CET
A file photo at Ikea in Aalborg, where 31 people stayed overnight during a snowstorm on December 1st 2021.
A file photo at Ikea in Aalborg, where 31 people stayed overnight during a snowstorm on December 1st 2021. Photo: Henning Bagger/Ritzau Scanpix

Anyone who has found themselves wandering the mazy aisles of an Ikea might be able to empathise with the sense of being lost in the furniture store for a seemingly indefinite time.

Such a feeling was probably more real than usual for six customers and 25 staff members who were forced to spend the night at the furniture giant’s Aalborg branch after being snowed in.

Heavy snow in North Jutland brought traffic to a standstill and halted public transport in parts of the region on Wednesday afternoon, resulting in a snow-in at Ikea.

“This is certainly a new situation for us,” Ikea Aalborg store manager Peter Elmose told local media Nordjyske, which first reported the story.

“It’s certainly not how I thought my day would end when I drove to work this morning,” Elmose added.

The 31 people gathered in the store’s restaurant area and planned to see Christmas television and football to pass the evening, the store’s manager reported to Nordjyske.

“Our kitchen staff have made sure there is hot chocolate, risalamande, pastries, soft drinks, coffee and the odd beer for us in light of the occasion. So we’ll be able to keep warm,” he said.

“We couldn’t just send them outside and lock the door behind them at our 8pm closing time. Absolutely not. So of course they’ll be staying here,” he added.

The temporary guests were given lodging in different departments of the store in view of the Covid-19 situation, Nordjyske writes.

“For us , the most important thing was to take care of each other and that everyone feels safe,” Elmose said.

At least Ikea’s stranded customers and staff had somewhere comfortable to lay their heads.

The same can unlikely be said for around 300 passengers at the city’s airport who had to stay overnight at the terminal.

The airport was forced to stop flights from 2:30pm yesterday amid worsening weather, which also prevented buses from transferring passengers to hotels.

“We have around 300 people in the terminal right now and have been giving out blankets on the assumption they will be staying here tonight,” Aalborg Airport operations manager Kim Bermann told Nordjyske.

READ ALSO: Ikea reopens in Denmark after country’s worst retail month this century

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