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Reliance retail runs into Bloc

Calcutta, April 9: Served a legal notice by Reliance, the Bengal agriculture marketing board has sought from the Mukesh Ambani group a detailed project report on its retail venture and tightened the licensing policy.

The cell has extended the jurisdiction of a law to Calcutta and Howrah, which makes it mandatory for all big traders dealing in farm products to seek a licence. So far, this law — the Agricultural Produce Marketing Regulatory Act — applied to the rest of Bengal.

The change means that all big stores and malls selling vegetables and other farm products in Calcutta and Howrah will have to seek a licence, besides securing other mandatory clearances.

The board, a preserve of the Forward Bloc that has been opposing Reliance’s entry into the farm products business, is also planning to set a string of conditions for the company.

The wait for the licence has stalled the Bengal launch of Reliance Fresh stores that have got off the ground in several other states.

Two days ago, the chief minister had told the Bloc that there is no legal ground for denying the licence to Reliance.

The board’s new drive is being seen as an attempt to delay a decision without appearing to be defying the chief minister.

In public, the Bloc has been citing farmers’ interests for its cautious approach. However, speculation is rife that the Bloc, which has a stranglehold on the farm products marketing apparatus in the state, fears losing its clout if a big player like Reliance enters the field.

The latest standoff set in after Reliance’s lawyer sent a notice to the board a few days ago. The notice has sought a reply “within 10 days why the client was not issued the licence applied for two months back”.

In its reply, the board has asked for the “specifics of the proposed retail business” and told the company to apply to the state-run market committees for the licence. The Bloc’s writ runs in these panels, too.

The terms proposed by the board include an assurance from the company that contract farming would not be encouraged, food grain would not be hoarded and regulated prices would be followed.

Reliance will have to agree to locate terminal markets and retail shops 10-50 km away from the state-regulated markets and principal traditional markets, said Naren Chatterjee, the marketing board chairman and Bloc leader.

Reliance has no plans for contract farming but in no state where it has opened stores are prices regulated.

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