Reliance axes plans after protests

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India's Reliance Industries has ended the services of about 400 franchisees for its planned retail operations in West Bengal state and deferred a rollout in neighbouring Orissa because of protests from small traders.

The moves come after Reliance Retail, a subsidiary of India's biggest listed firm, laid off 1000 staff in northern Uttar Pradesh last month, after the state shut 10 Reliance Fresh supermarkets following protests and attacks by small traders.

Reliance, which is spending more than US $5.5 billion in its retail venture, had planned to open about 500 Reliance Fresh supermarkets in West Bengal state and about 150 in Orissa, a senior company official told Reuters.

"We are very clear: if a particular state cannot guarantee protection, we will not go and open stores," the official said.

Modern retail faces political obstacles because of fears that millions of small shopkeepers could lose their jobs in the fragmented but fast-growing industry, which is forecast to double in size by 2015.

India limits foreign multiple-brand retailers to wholesale or franchise and license operations.

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