ITC Ltd, the fast-moving consumer goods (FMCG) major, has run into land problems regarding its farm initiative in West Bengal, chairman YC Deveshwar said here today.
For West Bengal, the Kolkata-based ITC had announced a Rs 1500-crore investment plan that includes setting up an experimental farm to train the state’s farmers.
“We need around 100 acres to begin with, but we have not got anything so far,” Deveshwar told reporters after the 96 th annual general meeting of its shareholders here today.
Hinting at the “controversies” over land dogging some other big investors here, Deveshwar said ITC’s needs were modest. He said he expected ITC’s land issue to be resolved soon, especially since it would help small and marginal farmers.
ITC plans to set up an experimental farm to help farmers improve their productivity and the also the quality of their produce, and also have food processing, Deveshwar said.
“Alongside, there would be the logistics infrastructure to move goods in and out of West Bengal, and also within West Bengal,” he said.
“But so far we haven’t had the advantage of that land we are looking for,” he said. “But as soon as that come our way, we are keen and ready to make an investment of that order.”
ITC is also investing in another hotel next to its ITC Sonar Bangla hotel here.
“At the end of the day, West Bengal must industrialise,” Deveshwar said, as it would be the only way in the long term to create jobs.
The land problem is not peculiar to West Bengal—- Deveshwar admitted that ITC is facing land problems across the country in implementing its expansion plans for the hotels, farm-produce and retail businesses.
He said there are two problems regarding land. First, titles are not clear. Second, land is not available at an affordable price where it is needed by the company.
Earlier, replying to shareholders at the AGM, Deveshwar did not also rule out an entry into financial services, an area in which it took a big hit ten years ago via ITC Classic and exited. Some shareholders had suggested that ITC take a look at investment banking and run mutual funds.
However, he said, ITC does not have the capacity to run that kind of business. “So we will not do that until such time as we feel that we would be able to do it better than others,” he said.
As for entering the power sector, an issue that had attracted flak from shareholders ten years ago when Deveshwar first took the helm, he said he would prefer to leave that for a later date. “We don’t feel that we have the core competency to go into that,” he said. “And there are other areas where we have the ability and we can leave that (power) for a later date.”