Govt disallows IKEA from selling food items in its brand stores

(FILES) A picture taken on March 27, 2013 shows the sign of Swedish furniture giant Ikea at the Odysseum shopping mall, in Montpellier, southern France. Swedish furniture giant Ikea said on April 6, 2013 it had stopped selling its frozen elk lasagne after a batch was found to contain traces of pork. AFP PHOTO / PASCAL GUYOT

The Commerce and Industry Ministry has rejected the proposals of global furniture major IKEA and Marks & Spencer to sell food and processed items from their brand retail outlets.

IKEA had sought permission for single brand retail trading of its products, including setting up of restaurants and cafe as well as IKEA Swedish food market, Commerce and Industry Minister Anand Sharma said in a written reply to the Lok Sabha.

The Foreign Investment Proposal Board (FIPB) has recommended that IKEA can have a restaurant/cafe in accordance with their global model but cannot engage in retailing of food items. “Accordingly, no food items shall be retailed off-the-shelf in any part of the retail store,’’ Mr. Sharma said.

IKEA has received FIPB approval for its Rs.10,500-crore proposal but the nod from the Cabinet Committee on Economic Affairs is yet to come.

Mr. Sharma said some foreign companies had requested for permission to sell food items as part of their FDI proposal under single brand retail trading. Marks & Spencer sought approval to sell its branded long life processed foods such as chocolates and confectionery.