Metro set to face stringent conditions in West Bengal

Metro set to face stringent conditions in West Bengal

Kolkata: West Bengal is likely to set stringent conditions for Metro Cash and Carry India Pvt. Ltd—the India arm of German retailer Metro AG—to trade in farm produce in the state.

Though the state government is yet to decide on all the conditions it will set, agriculture minister Naren De said the minimum purchase value for each item sold at Metro’s Kolkata outlet would be Rs5,000. This, he said, is aimed at preventing Metro competing with retailers.

The German retailer, which runs four outlets in India, will not be allowed to buy farm produce directly from farmers in West Bengal. It would have to buy fruits and vegetables from markets regulated by the state’s agricultural marketing board. Retailers who would like to buy from Metro would also have to obtain licence from the board, De said.

Metro has spent around Rs140 crore on setting up a 100,000 sq. ft outlet in Kolkata, but hasn’t opened the store for want of a licence from the government to trade in farm products. Chief minister Buddhadeb Bhattacharjee intervened to grant the licence, but the venture now seems to have run into another hurdle.

Vishal Sehgal, Metro’s head for corporate relations, said no other state has imposed any restriction on its business. “There’s only one restriction—minimum billing amount has to be Rs1,000—but that’s self-imposed," he said.

Metro, which hasn’t been told about the conditions, wouldn’t comment till it received a formal communication from the government. “Once we know what they want, we will have to consider several things—business viability, legitimacy of the conditions, and so on," Sehgal said.