Calcutta, April 13: The state agriculture marketing board is examining whether procurement centres proposed by Reliance for its retail foray will stand legal scrutiny.
The latest thrust follows a string of objections and conditions from the board, which is controlled by the Forward Bloc.
“Unlike common traders who seek licence to trade in a particular agricultural product in existing markets, Reli- ance is asking for a licence to purchase various products from farmers and sell them through its own outlets,” said Naren Chatterjee, chairman of the agriculture marketing board.
“The group has already bought or obtained lease on land to set up its own malls and marts in Bengal. So, the company is looking for a multi-product licence needed to trade as well as set up permanent terminal markets and retail shops,” he added, equating the proposal with a mandi.
The board, which has rejected the company’s proposal for a joint venture, will examine the law to see if Indian private retailers can be allowed to set up such a mart.
Retail sources, however, said Reliance’s procurement centre cannot be equated with a mandi where there are multiple sellers and buyers. The company’s procurement centre — which can be upgraded to sell as well — will have multiple sellers but one buyer (Reliance).
Reliance has set up procurement centres in every state where it has launched its agri-retail business.
“This is a new phenomenon. The board will meet on Monday to examine whether the present law permits such a licence to private companies,” Chatterjee said.
According to him, the law permits management of haats (weekly marts) and markets by individuals who pay a fee to the board-run marketing committees and charge the merchants trading in them.
“The law empowers us to regulate setting up of new markets, which are not to be located within 5-10 km of an existing market. We may increase the distance to 50 km for upscale outlets,” said Chatterjee, who, instead of minister Mortazza Hossain, has been given charge of Reliance affairs by his party.
Retailers called for a simplification of rules. “There is no composite licence for all agri-commodities in any state. We want the multiple licensing structure to be simplified with one licence,” said Arvind Chaudhury, CEO (Food) of Pantaloon Retail.