Lok Sabha Question No. 1706 (UNSTARRED), answered on 2024-08-01
Subject: Allocation of Petrol Pumps by PSU Oil Marketing Companies
Ministry: PETROLEUM AND NATURAL GAS
Asked by: Shri Amrinder Singh Raja Warring

## LOK SABHA UNSTARRED QUESTION NO. 1706 TO BE ANSWERED ON 01 AUGUST, 2024

## Allocation of Petrol Pumps by PSU Oil Marketing Companies

1706 Shri Amrinder Singh Raja Warring:

## पेट Ō ोिलयम और Ůाक ृ ितक गैस मंũी

Will the Minister of PETROLEUM AND NATURAL GAS be pleased to state:

- (a)  whether  the  dealership  commission  of  petrol  pump  has  not  been  revised  by  PSU  Oil Marketing  Companies  (OMCs)  during  the  last  seven  years  despite  high  inflation  and  high operational cost and if so, the details thereof along with the reasons therefor;
- (b) whether the families of martyrs belonging to the Indian Army or Central Armed Forces has been allotted petrol pumps and gas agencies, on compassionate grounds by the PSU OMCs to provide regular source of income to such families and if so, the details thereof;
- (c) whether many of the said families have either left the trade or gone bankrupt due to the very low margins; and
- (d) if so,  the details  thereof  along  with  the  measures  taken  by  the  Government to ensure their secure livelihood?

## ANSWER

## पेट Ō ोिलयम और Ůाक ृ ितक गैस मंũालय मŐ राǛ मंũी ( ŵी सुरे श गोपी )

## MINISTER OF STATE IN THE MINISTRY OF PETROLEUM AND NATURAL GAS (SHRI SURESH GOPI)

(a): Petrol and diesel are marketed at retail outlets run by Oil Marketing Companies (OMCs) in  both  public  and  private  sector.  As  of  01.07.2024,  there  were  90,639  retail  outlets  in  the country  of  which  about  90% belong  to  public  sector  companies  and  rest  to  the  private  sector companies.

Retail  marketing  of  petrol  and  diesel  is  deregulated  and  decisions  regarding  their  prices, including dealer margins, are taken by respective companies themselves.

For PSU OMCs, Dealer margins on retail sale of petrol and diesel primarily include operating costs, manpower costs / wages of employees, business returns, etc. Dealer margins were revised by PSU OMCs in August 2017. This revision had factored in a higher rate of wages to RO staff by  dealers,  which  was  based  on  Minimum  Wages  notified  by  the  Central  Government. Subsequent to the revision, OMCs advised the RO dealers to pay these prescribed wages to RO staff. To ensure implementation of revised wages by RO dealers, OMCs introduced appropriate clauses in Marketing Discipline Guidelines (MDG) - 2012.

However,  while  the  revised  dealer  margins  were  implemented,  several  dealer  federations challenged  the  MDG  amendments  relating  to  inter-alia  payment  of  higher  wages  in  various courts.  While  deciding  the  petitions  filed  by  one  dealer  association,  in  January  2022,  Hon'ble Delhi  High  Court  upheld  the  amendments  in  the  MDG.  However,  dealer  associations  filed Special Leave Petition (SLP) before the Hon'ble Supreme Court challenging the order passed by Hon'ble Delhi High Court and the matter is currently sub-judice.

Discussions  and  Negotiations  regarding  revision  of  dealer  commission  are  held  bilaterally between PSU OMCs and RO dealers' federations. Government is aware of these discussions and has been supportive of such engagements to resolve pending issues affecting revision.

(b) to (d): With a view to rehabilitate the bereaved families of the Defense personnel/who laid down their lives in the defence of the Nation during the Kargil War, Parliament Attack and Mumbai  Attack,  Government  had  introduced  special  schemes  for  direct  allotment  of  Retail Outlets (ROs) to the wife /next of kin of the Martyrs. Public Sector Oil Marketing Companies (OMCs) allotted 322 Retail Outlets to the families of martyrs who laid down their lives in the defence of the Nation during the Kargil War, Parliament Attack and Mumbai Attack.

Public Sector Oil Marketing Companies (OMCs) have also informed that there is a provision of reservation for allotment of Retail Outlet dealership to the Widows/dependents of those members of  Armed  Forces  who  died  in  war  or  in  harness  due  to  attributable  causes  under  Combined Category  1  (CC1)  and  have  allotted  451  ROs  under  this  category  as  on  30.06.2024.  The selection/allotment under this category is done as per the extant RO dealer selection guidelines.

Public Sector Oil Marketing Companies (OMCs) have allotted 147 LPG distributorships to the families  of  martyrs  belonging  to  the  Indian  Army  or  Central  Armed  Forces  on  compassionate grounds the for Operation Vijay Special Scheme (OVSS) and Mumbai martyrs.

Selection  of  LPG  distributorship  is  carried  out  by  Oil  Marketing  Companies  as  per  Unified Guidelines for Selection of LPG distributorships. As per the Guidelines, a reservation of 8% is provided under Government Personnel (GP) Category, which covers - (i) Widows/Dependents of Armed Forces (viz., Army, Navy, Air Force) or Central Para Military  Forces/Central or State Special  Forces,  those  died  while  performing  their  duties,  (ii)  Disabled  personnel  of  Armed Forces  (viz.,  Army,  Navy,  Air  force)  or  Central  Para  Military  Forces/Central  or  State  Special Forces while performing their duties. (iii) Ex-service man who has served for the Armed Forces (iv) Widows/Dependents  of personnel of Central/State Governments  and Public Sector Undertakings who  died while performing their duties and such disabled personnel of Central/State Governments and Public Sector Undertakings causes attributable to performance of duties.  A  total  of  277  LPG  distributorships  have  been  commissioned  under  Government Personnel (GP) Category as on 30.06.2024.

To  ensure  the  sustainability  of  petroleum  retail  outlets  and  the  quality  of  their  services  to customers, OMCs have added new generation fuels viz. premium MS/HSD, alternate fuels like Compressed  Natural  Gas  (CNG),  Compressed  Bio  Gas  (CBG),  Electric  Vehicle  Charging Stations (EVCS) and have been encouraging non-fuel businesses like Pollution Under Control (PUC) check, Insurance, Courier service, Service center for vehicle, Grocery stores, Convenience stores, Food & Beverages outlets etc.

PSU  OMCs  have  informed  that  during  the last 10 years, no RO  dealerships  /  LPG distributorships  allotted  under  the  above  categories  have  discontinued  business  due  to  low margins.

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