http://www.ft.com/cms/s/0/e9931652-29cf-11de-9e56-00144feabdc0.html?nclick_check=1

Strained relations with local business
By Amy Kazmin in Lucknow

Published: April 15 2009 16:28 | Last updated: April 15 2009 16:28

Soon after Kumari Mayawati took power as chief minister of Uttar
Pradesh in May 2007, Reliance Fresh, the retail division of Mukesh
Ambani’s Reliance Industries, opened the first 10 of what were
supposed to be at least 100 small grocery stores across the state.

After the outlets were attacked on the opening day, Ms Mayawati – who
three weeks earlier had unveiled a policy designed to facilitate
modern retail – ordered the chain to close in the “greater interest of
law and order”.

Ms Mayawati’s mercurial stand towards Reliance Fresh highlights what
business groups see as her indifference towards private companies and
the challenges they face.

Uttar Pradesh hosts large manufacturers including Yamaha and Daewoo,
but business groups complain of a nexus between criminals and police
creating serious security threats, including kidnappings and unrest.
Small-scale industries say they are subjected to big power shortages,
excessive red tape and pervasive harassment for bribes.

Ms Mayawati has refused requests from local business associations to
meet to discuss their woes. “They could do much better in terms of
making the state a friendlier place for business,” says Jayant
Krishna, vice-chairman of the Uttar Pradesh branch of the
Confederation of Indian Industry.

Senior bureaucrats in Ms Mayawati’s administration insist she is not
anti-business, but say her priority is overcoming glaring
infrastructure deficiencies with new power plant deals and an $8bn
(€6bn, £5.3bn) highway across the state.


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