Govt reforms to liberalize fuel retail fail to take off

The petroleum ministry's reforms to liberalize fuel retail have failed to take off as over half a dozen private firms that obtained marketing licenses last year could not execute their business plans because of tacit government interference in the pricing of petrol and diesel, at least four people said.

- Rajeev Jayaswal

The new entrants, who have made huge investments in the venture, could not operationalise plans due to predatory pricing of auto fuels by state-run oil marketers, the people said, requesting anonymity.

State-owned retailers Indian Oil, Bharat Petroleum, and Hindustan Petroleum have kept petrol and diesel rates frozen since April 6. As they together enjoy a virtual monopoly by operating about 80% of the 81,699 pumps across the country, many private firms have stopped selling fuels, particularly diesel. New retailers have either abandoned their plans or put them on hold, the people said.

After fuel marketing was liberalized in 2019, the government allowed several companies in the retail and bulk trade. New licensees included Kolkataregistered IMC Ltd, Pune-based Onsite Energy, Dibrugarh-based Assam Gas Company, MK Agrotech from Karnataka, Manas Agro Industries, and Infrastructure from Maharashtra, and Mumbai-based RBML Solutions, a joint venture of Reliance Jio and Bharat Petroleum.