Furniture retailer Ikea is planning to invest an additional $500m to set up 25 stores in India over the next decade.

All new stores will be opened in the cities like Mumbai, Delhi, Hyderabad and Bangalore, the Swedish furniture retailer said.

Ikea has received formal approval letter from the Indian government to open single-brand retail stores with an investment of INR10.5bn ($1.73bn) under FDI.

Ikea India chief executive Juvencio Maeztu said: "We are looking at investing around Rs.12,500 crore to set up 25 stores at a cost of Rs.500 crore each. We will be mobilizing $500 million from our global partners for this venture."

"It is difficult to specify any time-frame when we will set up the first store, still I can say we are working on it and we are in talks with different states and are looking at all major metros for land as we require very large area of land that is near a highway," Maeztu added.

First store, under the plan, will be opened in Bangalore or Hyderabad within the next couple of years.

"For now, the priority is the right location and we are focusing on all major metros, the right location and the good price of land, which is important for us to start right."

Further, Ikea plans to tie-up with local suppliers for raw material for its forthcoming stores in the country.