Financial crisis leads RIL to go slow on projects

Mumbai: Mukesh Ambani-controlled Reliance Industries may go slow on certain of its planned projects such as the Rs 5,000-crore Rewas port project, the Navi Mumbai SEZ project and the Rs 30,000-crore semi-conductor project in response to the global financial meltdown. Instead, it will focus more on its core businesses that include refining and petrochemicals.

RIL, India’s biggest private corporate entity in terms of market capitalisation, is also mulling other measures such as streamlining back-end operations, tuning production capacities and re-allocating some of its workforce to battle the financial crisis, sources familiar with the development said.

The Rewas port project in Maharashtra, which is 65 per cent owned by various investment companies of RIL, 24 per cent by Amma Lines and 11 per cent by Maharashtra Maritime Board, was expected to provide the vital sea-link to its Mumbai SEZ project.

As it is, the project has been facing a debilitating delay due to land allocation problems. Some senior employees, who had been hired from other ports, had left in the last few months, as uncertainties continued, the sources said.

When contacted, a RIL spokesman declined to comment, stating that “as a good corporate practice, we constantly examine our cost competitiveness and take appropriate measures regularly.”

RIL’s ambitious Rs 30,000 crore semi-conductor project, which is still in the evaluation stage, is likely to be another of its projects that may be relegated to the cold storage for the time being. The company was planning to set up the semi-conductor facility over a period of five years to manufacture silicon chips, liquid crystal display units and solar photovoltaic cells.

However, on the retail front, Reliance Retail may tweak its expansion plans in certain regions in the country, but overall, it may not be that affected. The RIL spokesman said that Reliance Retail continued to grow as per our expansion plans. “In the last quarter, Reliance Retail has added over 80 stores and at present has over 800 stores across the country.”