Reliance steers clear of row over farm bills3 min read . Updated: 05 Jan 2021, 07:24 AM IST
- Firm says it has no plan to enter contract farming business
Reliance Industries Ltd (RIL) denied that it plans to enter the contract-farming business or buy agricultural land, seeking to distance itself from the controversial farm laws that have seen angry farmers burn Jio sim cards and vandalize its telecom towers.
“Reliance Retail has never entered into long-term procurement contracts to gain an unfair advantage over farmers or sought that its suppliers buy from farmers at less than remunerative prices, nor will it ever do so," RIL said in a statement on Monday.
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Reliance is trying to allay concerns that the three new farm laws will help large companies like it flourish at the expense of poor farmers.
Thousands of farmers from across India are staging a sit-in along Delhi’s borders since 26 November to protest against the laws that aim to overhaul the way they do business.
Farmers fear that the market-oriented reforms will soon lead to corporate takeovers of their small landholdings.
The farmers are demanding a complete rollback of the three laws and a guarantee from the government that the minimum support price programme for crops will not be abolished.
Protestors in Punjab and Haryana have allegedly vandalized as many as 1,500 of Reliance Jio’s 9,000 mobile towers, causing wide-scale disruption in services.
Reliance has alleged that the vandalism was done at the behest of business rivals.
RIL also approached the Punjab and Haryana high court on Monday to direct the Punjab government to stop the alleged incidents of vandalism in the state.
“Reliance has nothing to do with the three farm laws currently debated in the country, and in no way benefits from them. As such, the sole nefarious purpose of linking the name of Reliance to these laws is to harm our businesses and damage our reputation," RIL said.
Reliance Industries, through its retail unit, is also India’s largest retailer, both in terms of store count and revenue.
The company operates neighbourhood shops, supermarkets, hypermarkets, and wholesale and online stores.
According to RIL’s annual report, it directly procures from farmers under its farm-to-fork model. The company has a network of farmers, growers, producers, and small-scale industries and access to agriculture produce markets.
Last year, Reliance tied up with Facebook to offer personalized services to farmers as well as connect them to agri-tech startups.
“As RIL’s offline as well as online business gains scale, we expect the procurement from farmers to increase," said an analyst with a domestic brokerage tracking Reliance Retail.
The contentious laws were passed by Parliament in September. Mandis, or marketplaces for selling farm products, were set up in the 1950s to stop the exploitation of farmers and pay a support price for certain produce.
Many farmers see the MSP as a vital safety net and are wary of the new laws.
Last month, the Adani Group took out full-page advertisements in Punjab publications to counter the allegations levelled against it.
The group said that the company does not buy grains from farmers but merely provides its services to the Food Corporation of India (FCI) to safely manage and transport the produce.
There are other companies that provide the same service, it said. “We only work in the infrastructure sector. The company has no role in deciding the quantity of storage and pricing of grains as it is a service and infrastructure provider company only for FCI," it said.
Adani added that it has no intention of acquiring agricultural land.
The necessary land allocated to the group is to construct storage infrastructure for FCI. Clarifying that Adani Agri Logistics was established in 2005, the company said its only purpose is to construct storage infrastructure that could save tonnes of grains from damage.