Tag Archive for 'reliance'

Reliance Fresh is a vegetable chain owned by Mukesh Ambani’s Reliance Industries. Its a modern food chain that offers low prices, fresh vegetables and a superior shopping experience. Its a breath of fresh air in India’s highly fragmented and obsolete retail industry. It was attacked by a Member of Parliament. Now its been asked to close in UP.

Well, first some background. The government is UP is new. The Samajwadi Party (SP) recently lost to the Bahujan Samaj Party (BSP) in a landslide. The BJP has been demolished too. So we can understand the frustration of the opposition parties. They would like to create a controversy and destabilize Mayawati’s government.

Its easy to whip up fear among the millions of poor in UP. A big corporate giant is out to exploit farmers and kill small traders. They will send all the small traders out of business with their low prices. After they have done that they will raise prices for the consumer and drop procurement prices for the farmer. All very predictable. But the sad part is the its all very untrue.

As of 2007 retail and food chains account for a vanishing fraction of total sales in India (unlike advanced economies). They do not represent a threat to the millions of small traders as a whole now and for the forseeable future. In the localities they are present, they can negatively affect the small traders. But they provide so many benefits as a whole to the economy that its certainly worth it in the long run.

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