Reliance’s Bengal mantra: non-grocery retail outlets

Reliance’s Bengal mantra: non-grocery retail outlets

Kolkata/New Delhi: Stung by the fierce opposition to its grocery stores in many states, Reliance Retail Ltd now plans to push other formats in West Bengal even as it is suspending plans for all formats in Uttar Pradesh.

Reliance will go ahead with its plan to roll out stores for consumer electronics, health and beauty products, apparel as well as hypermarkets in West Bengal. But the company has to shelve plans for its controversial Reliance Fresh grocery stores in Kolkata.

“We expect to have some of these (non-grocery format) stores open in Kolkata before the end of the current financial year" that ends March, said Raghu Pillai, president of Reliance Retail.

Pillai declined to give details of the formats but the company had earlier said it plans to invest Rs2,000 crore in the state to open several grocery stores, two outlets each in lifestyle, consumer electronic, footwear and three hypermarkets in the next three years.

Pillai added that the company has already lined up space for some of the formats but said it is unlikely the hypermarkets would be ready by the end of the fiscal year.

In August, Reliance Retail, part of Reliance Industries Ltd, suffered a major setback when the Uttar Pradesh government ordered the closure of all Reliance-owned grocery stores in the state, saying that the stores created social tensions.

The company also had to abort a planned opening of Reliance Fresh stores in West Bengal after the Forward Bloc, a partner in the state’s ruling Left Front coalition, warned of violent actions if the company opens its stores there.

“We have no retail plans in Uttar Pradesh now, in agri or other formats," Pillai said.

The company had ambitious plans for India’s most populous state and was planning to invest about Rs4,000 crore in opening 15 million sq. ft of shopping space including 250 Reliance Fresh, 75 health and beauty stores, a dozen each of consumer electronics and hypermarkets and 80 retail hubs in smaller towns called Reliance Town Centre.

Reliance Fresh has become a symbol of major companies entering the sensitive agri-produce business that many farmers and small traders believe will drive them out of jobs. The grocery stores were attacked and ransacked in many cities.

“Transformational initiatives always come with challenges," Mukesh Ambani, chairman of Reliance Industries, told the company’s annual general meeting referring to the hostility faced by its retail venture. “More so, when an initiatives seek to change a system that has been in place for centuries."

Ambani said the company is “sensitive to the interest of small shopkeepers" and its retail venture “in no way jeopardizes their interests and that of small vendors."