IKEA plans to hike quantity of cotton, expand stores in India

IKEA, the Swedish furniture company, 10 percent of whose global cotton suppliers are from India, plans to increase sourcing of cotton from India for its textile requirements as it gears up to start retail operations there by next year.

The company, which is working with around four lakh farmers in India through local partners under its better cotton initiative (BCI) programme, is sourcing almost one-third of its global requirements from India.

In 2015, the company bought 35 percent of its global cotton requirement from India. The textile component accounted for about 70 percent of its overall India purchases valued at about €315 million. This, the company said, is poised to grow in the coming years.

IKEA Cotton Leader Pramod Singh said that till now, IKEA retail was not present in India. Given the retail plan which they have till 2025, obviously sourcing of sustainable textiles from India would increase dramatically even for the local market.

The company does not have a preference for genetically-modified cotton over the traditional one, he said. They are technology neutral in this. It depends on the farmer’s choice.

IKEA, which is planning 25 stores in India by 2025, had sourced goods worth 315 million euros from India, in which textiles contributed around 70 per cent. In 2015, the company had sourced around 35 percent of its cotton from India followed by Pakistan at 21 per cent.

Peter Agnefjall, IKEA Group President and CEO, said that IKEA has firmed up plans to set up a manufacturing base in India, in addition to setting up retail stores. It is important for them to set up their production (unit) in India.

Earlier in March this year, the company bought land from Tata group company Rallis India in Mumbai on lease basis for Rs. 214 crore. Besides, IKEA purchased land in Karnataka to set up four retail stores entailing an investment of about Rs. 2,000 crore.

IKEA would be adding more farmers in its programme for sustainable sourcing. The company trains farmers under its better practices about traditional and genetically modified cotton seeds and their usage.

The company has globally over 100 suppliers for cotton and 11 are from India.

IKEA aims to promote measurable improvements in the key environmental and social impact of cotton cultivation worldwide to make it more sustainable.