The entry of retail giant IKEA will help empower small and medium enterprises further, while the government will continue to protect the interests of SMEs, Commerce and Industry Minister Anand Sharma said today.
"Our philosophy is SMEs and how their empowerment takes place," Sharma told reporters when asked if the government was considering relaxing the mandatory 30 per cent sourcing from small industry for 100 per cent FDI in single-brand retail. According to the present single-brand FDI policy, global retailers would have to source 30 per cent of their requirement from Indian small industries which have a total investment in plant and machinery not exceeding $1 million.
IKEA has asked the government to relax norms regarding mandatory sourcing from small units for operating 100 per cent controlled single-brand retail business in India.
IKEA has, among other things, sought that it be allowed to continue sourcing from its small vendors even after they have crossed the $ 1 million investment limit.