While politicians brag about their ‘people’ power, which in many cases is nothing other than protecting their turf, the businessmen, who have the ‘money’ power, go about doing their bit in perfect silence.
The recent winning of the rights to make over Park Circus market by the Reliance group is an example.
Reliance won the contract after KMC floated an open tender. No opposing voice was heard before the event, but after Reliance’s bagging the contract, political parties are afraid that it may be the beginning of the company’s sweep in the lucrative retailing of fresh food items.
Can Reliance be stopped in its fresh food business? One doubts. Why?
Already several giant retailers are selling fruits and vegetables from their outlets for several years, though their scale of operation is not as big as what Reliance proposes to do. But the fact is retailing of vegetables from retail joints is already happening.
The other solid reason is that Reliance has after all won the contract against a valid tender. If they are stopped now, won’t they approach the courts to seek justice? Those perhaps are the reasons why KMC may have to award the contract to Reliance.
That being the case, the fear that small vegetable sellers will feel the heat of Reliance’s competitive prices is not unfounded. Recently in Ranchi an outlet of the company was severely damaged by protesters for this reason.
Is there a way out? Perhaps no. In the immediate term, there’ll be protests by small sellers with the backing of political parties. In the long run, retailing has to happen, if only because the government at the center wants so, and also there cannot be separate yardsticks for different states in the country.
To take the logic of retailing of fresh foods further, there is a strong possibility that intense competition among retailers will force them to look at farming as well on the back of superior technology.
If that happens it’ll be good for Indian agricultural scenario because small land holding among farmers prevent them to invest in advanced techniques to improve productivity. They are also not in a position to adopt means to prevent wastage of their produce.
Here is where large retailers will usher in a sea change. For effective productivity they’ll control large tract of land, use better seeds, improve cultivation and harvesting, and at the end, preserve the produce to prevent unnecessary wastage.
For this to happen, it is quite possible that many lowest-rung people will loose livelihood, but such change will not happen overnight. To one’s best understanding, the concept of contract farming is not very far off.
But to make the transition as painless as possible, the government must initiate every step at the earliest.