Reliance outlets ransacked in Orissa

BHUBANESWAR/LUCKNOW: Reliance Industries' retail juggernaut faced fresh hurdles on Tuesday with angry traders forcing closure of outlets in Bhubaneswar, even as the Mukesh Ambani-led firm is understood to have decided to go slow on its about Rs 8,000-crore expansion plan in Uttar Pradesh.

Traders ransacked two Reliance Fresh outlets soon after the stores were opened in Orissa's capital city on Tuesday, forcing the police to order their closure. Following the incident, the company did not open another store in the city as scheduled.

The traders caused substantial damage to shops and also attacked some of the employees, Deputy Superintendent of Police, Sarat Sahu told in Bhubaneswar. "Immediately after the incidents, the authorities ordered closure of the Reliance Fresh outlets to prevent any further flare up," he said.

Sources said police authorities had told Reliance officials on Monday not to go ahead with launch of the three stores "in view of the law and order situation arising out of the designed protest and demostrations" by traders.
   
Tuesday's incident was almost a repeat of scenes witnessed in parts of Uttar Pradesh and New Delhi in the last few days, when local traders forcibly tried to close Reliance outlets.

Meanwhile, informed sources said Reliance Retail Ltd, the wholly-owned subsidiary of RIL, appears to have put on the slow track its mega investment plan in Uttar Pradesh. The company planned to invest about Rs 8,000 crore in next few years in the country's most populous state for setting up about 200 outlets, a supply chain and back-end operations.
   
There are 335 Reliance Fresh outlets, which sell food items and vegetables, in the country. Of these, 318 are operational, while 17 of the total 20 in Uttar Pradesh have been shut after protests from traders late last month.

Company officials could not be contacted, but sources say it is awaiting the report of a Uttar Pradesh cabinet committee appointed by the Mayawati government after the stores were closed on the ground of maintaining law and order.

Uttar Pradesh is the biggest retail market in the country by virtue of its population of more than 16 crore, but big retail chains have faced a number of closures in the recent past due to opposition from political and trader groups. Late last month, the Mayawati goverment shut down stores of Reliance and Spencers' following protests by small traders.

Reliance Retail has estimated a total investment of more than Rs 25,000 crore across the country over the next few years, but today's incident in Orissa could impact its plans in the state where it plans to invest about Rs 3,000 crore.

Company sources said 11 Reliance Fresh outlets were to be opened in Bhubaneswar, and nine in neighbouring Cuttack. The company plans to open 235 outlets in the state. The three outlets were earlier scheduled to be opened on September 15 but the inauguration was deferred following traders' protests.

The move evoked resistance from local traders with 'Nikhil Orissa Utha Dokani and Khyudra Vyavashyi Mahasangha' launching an agitation, saying it would hit the livelihood of seven lakh small traders and their family members.

While Reliacne is facing stiff opposition in a number of states such as Uttar Pradesh, West Bengal, Orissa and Kerala, it appears to making up for the uncertainty with aggressive expansion plans in other states such as Madhya Pradesh.

Last week, Reliance outbid DLF Ltd, the country's biggest real estate firm in terms of market value, to bag a commercial project in Indore. According to sources, Reliance plans to build a hyper market there at an investment of about Rs 1,000 crore.