India strike over supermarket reforms

Opposition parties and trade unions in India have staged a day-long strike over plans to open the country's retail sector to global supermarket chains.

Calcutta and Bangalore were virtually shut down, but the response in other parts of the country was mixed.

The reforms, which ministers say are needed to revive the economy, were formally introduced on Thursday.

But small shops fear they will be put out of business and many people are angry at recent fuel price rises.

Earlier in the week a key ally left the governing coalition in protest, although its majority in parliament is not at immediate risk.

The Congress-led government attempted to introduce the retail reforms last year, but backed down in the face of opposition.

Thursday's nationwide strike, called by the main opposition Bharatiya Janata Party (BJP), its allies and Communist parties, shut down schools, businesses and public transport in many cities.

TV channels showed protests taking place in the cities of Patna, Allahabad and Varanasi in northern India.

Most businesses were shut in the eastern city of Calcutta and public transport was disrupted, reports said.

The impact of the strike was near-total in the northern states of Uttar Pradesh and Bihar where the ruling Samajwadi Party and the Janata Dal (United) parties supported the protest.

In the two states, protesters held noisy demonstrations where they burnt colourful effigies of PM Manmohan Singh and blocked railway tracks.

The southern state of Karnataka, which is governed by the BJP, was shut down in response to the strike call, with buses off the roads and schools, hotels and businesses closed.

The state capital, Bangalore - home to hundreds of IT companies including multinationals like IBM and Microsoft - was completely shut down.

"We have asked our employees to stay back at home. We will instead work on Saturday," an official of Infosys, one of India's leading software companies, said.

"The fear factor is the reason for the closure," a spokesperson for another multinational company told the BBC.

Much of the capital was operating normally on Thursday, BBC reporters said. There was a similar picture in the financial capital, Mumbai.

In Congress-ruled Kerala, where strikes are otherwise common, this time the opposition's call did not evoke much of a response. Buses were operating and colleges and schools were open.

The BBC's Soutik Biswas in Delhi says this may well signal that politically-led mass protests over a single issue no longer have the ability to shut down the entire nation.

It could also reflect the fact that the merits and demerits of such retail reforms are distant from ordinary members of the public, our correspondent says.

The patchy turnout at the protests will be some comfort to the government, the BBC's Andrew North in Delhi says.

Job fears

The government's "big bang" reforms are aimed at reviving a flagging economy, as well as avoiding the threat of a downgrade in India's credit rating.

But many small shops fear for the future. Delhi-based trader, Deepak Sethi, said shopkeepers would lose business if foreign supermarkets were allowed into India.

"These big companies can attract customers by selling at cost prices. That means people here are going to lose jobs. Shops like ours will be hit the most," Mr Sethi said.

"Multinational companies will destroy the economic and social fabric of the country and will adversely impact traders, transporters, farmers and other sections of retail trade," Praveen Khandelwal of the Confederation of All India Traders told AFP news agency.

The Trinamool Congress party, a key ally of the ruling coalition, has said it will pull out of the government and withdraw support in parliament. Its six ministers are to resign on Friday.

The government also announced a 14% rise in the price of diesel, which is heavily subsidised in India. That move has also prompted great anger across the country.

Under the government's proposal, global firms - such as Walmart and Tesco - will be able to buy up to a 51% stake in multi-brand retailers in India.

Multinational retailers already have outlets in India, but at present they can sell only to smaller retailers. This decision allows them to sell directly to Indian consumers.

Indian Prime Minister Manmohan Singh has said the reforms would "help strengthen our growth process and generate employment in these difficult times".