The Hindu Business Line : Reliance Retail mulling new strategies for Bengal foray

Kolkata May 19 Hamstrung by political controversy and non-availability of Agriculture Produce Marketing Committee (APMC) licences to procure agri-produce directly from farmers, Reliance Retail is mulling alternative strategies for Reliance Fresh foray in Bengal. The company is currently considering the option of importing agri-commodities from neighbouring States.

Admitting that the project was scheduled for a rollout in late 2006-07 and has been delayed, a Reliance group source said: "We have already presented our case before the Chief Minister. We may approach him on the issue once again, shortly. Following which we have to take a call on our future strategy." The company is now aiming to roll out stores by June 2007.

Distribution Centres

The controversy has been kicked up by a section of the ruling Left Front, especially the All India Forward Bloccontrolling the West Bengal State Marketing Board. The latter, which is the State APMC authority, has rejected Reliance's application for trading licences in 15 APMC markets.

According to the official, Reliance is setting up six distribution centres — comprising muti-product cold storage facility of Rs 300 crore each and sorting and packaging facilities — in West Bengal.

Regulatory Market

Investments are also being made on setting up rural hubs for marketing agri-inputs and peripheral services, including bank finance, to farmers. Total initial investment is estimated at Rs 2,000 crore, which includes setting up 200 Reliance Fresh outlets in and around Kolkata.

Rejecting the claims of the marketing board that the project would endanger the livelihood of vast majority of farmers and middlemen, the official said: "On the contrary our activity will free the farmer from the clutches of private money lenders and provide access to better farming techniques."

He said that the total collection of one per cent regulatory market transaction fee is only Rs 20-25 crore a year but there is a clear potential of collecting anything in the region of Rs 350 crore a year. This apart, organised trade will ensure higher collection of sales and other taxes, he added.

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Reliance Retail mulling new strategies for Bengal foray