The Mukesh Ambani-controlled Reliance Industries Ltd (RIL) received an early New Year?s gift from Uttar Pradesh chief minister Mayawati. In a major turnaround, she has said that her government is not against investment by RIL or other private sector investors in the retail business in the state.
Mayawati said that if such investors plan well, there is space for ?everybody? in the retail business in UP. Mayawati?s turnaround comes five months after the UP government directed RIL to close down Reliance Fresh shops in a number of cities in the state following violent protests from local traders.
When contacted, a Reliance Retail spokesperson declined to comment on whether the company would reopen its stores in the state. However, sources in the know told FE, ?RIL has no plans to exit UP. But the company prefers to await official communication from the UP government before proceeding further.?
According to the source, of the Rs 25,000-crore investment planned by Reliance Retail, a substantial Rs 6,000 crore is earmarked for UP. It hopes to set up Reliance Fresh shops in 14 towns across the state. So far, of its 134 outlets nationwide, nearly 70 have been closed after the August violence. ?These outlets have yet to be leased out,? the source added.
After the incidents in August, Raghu Pillai, president & CEO, Reliance Retail, had declared that it had no plans to exit UP. However, the company would go ahead with its plans for the state only after ensuring the security of its employees, Pillai said.
In an interview with CFO Asia magazine, Mayawati said, ?I welcome private investment in all sectors of the economy. It will not be stopped.? However, she asked corporates willing to enter the retail space to provide jobs to people, who would otherwise be adversely impacted by their ventures.
When asked about her role in the closure of retail shops operated by companies like Reliance, she said: ?I have not ordered their closure… There was a law & order problem with affected people taking to the streets after these retail outlets were opened. Many lost jobs at kirana stores run by families. If planned well, there is retail space for everybody,? she added.