Global home furnishings retailer Ikea has announced plans to double its sourcing from India by 2020 from the existing $340m to $643m.

According to India's retail policy, at least 30% of the raw materials should be procured from local suppliers.

Ikea range and supply purchase development manager Henrik Gunnerling told PTI: "Ikea works on the principle of optimal sourcing for our global markets. Where it makes sense, we will source locally as well. We currently source products worth €318m from India and will almost double this by 2020 to around €600m.”

Ikea managing director Jesper Brodin told The Economic Times: “Asia is our second-biggest region for sourcing: While China offers the cheapest supplies, we see a lot of sourcing opportunities from other markets in Asia, Africa and South America."

Ikea’s first store will open in Hyderabad, Telangana, later this year. The company plans to open its second store in Navi Mumbai next year, which will have more than 9,500 products and an in-store restaurant.

"Ikea works on the principle of optimal sourcing for our global markets."

Ikea aims to open 25 stores in the country by 2025, with each outlet offering between 400 and 700 direct jobs, as well as 2,000 indirect positions.

Ikea South Asia purchasing operations business manager Sandeep Sanan told PTI: "India has a lot of potential. We have about 50 suppliers at present and have added 15 last year.

"We are looking for new suppliers and also to give them assistance to grow their business. Many new suppliers will come from other segments who are looking to diversify their business."

The furniture retailer secured the approval five years ago to set up stores under India’s foreign direct investment policy in a single brand.