Oil PSUs ‘won’t budge’ on dealers’ demands

The three public sector oil retailers are firm in their stand that they will not give in to the “unreasonable demands” of petrol pump operators, who have called for a nationwide strike on Friday and an indefinite strike from October 27 if their demands are not met.

Several associations of petrol pump owners and dealers have called for a strike to oppose the new Marketing Discipline Guidelines (MDGs) imposed by the PSUs, and are demanding that the sale of fuel be brought under the purview of the Goods and Services Tax. (Transport fuel was exempted from GST when the new tax code was brought in; these products are still subject to State and Central taxes.)

At a press conference in Mumbai on Tuesday, senior executives of Indian Oil Corporation, Bharat Petroleum Corporation and Hindustan Petroleum Corporation said the MDG was meant to improve the quality of service at petrol pumps.

“The question of whether petrol and diesel should come under GST is up to the GST Council to decide, not us,” said S Ramesh, Director (Marketing), BPCL.

The PSUs control about 54,000 retail outlets across the country, either owned and managed by them or owned by them and managed by independent dealers. While the company-operated outlets will continue to function, some of the dealer-operated outlets may shut down on Friday. While it is unclear how many outlets will be affected, the firms were confident that the strike will most likely be called off.

The primary bone of contention between the oil marketing companies and the dealers is the MDG, which was amended on October 2 and will penalise petrol pumps that deliver lower quantities of fuel to customers (short delivery), do not comply with the new daily price revisions system, are found manipulating prices, underpay pump attendants, or do not have clean, functioning toilets.

If a pump is found delivering less than the intended quantity to a customer by manipulating its measures or by turning off the automated reporting system, the pump owner can be fined anywhere between ₹25,000 and ₹2 lakh. Repeat offenders will be made to shut down their pumps, according to the new guidelines.

“These are measures that help the public, and pumps that comply with these quality guidelines have no reason to fear,” Ramesh said.

Additionally, the PSUs have said they will absorb the costs of paying higher salaries to pump attendants (to better the quality of service for customers) and will increase dealer commissions to pay for the maintenance of clean toilet facilities at pumps.

“Dealer margins have been revised four times in the past 13 months,” said BS Canth, Director (Marketing), IOC. “We have revised dealer commissions by 10-30 per cent, with higher increase for low-volume dealers. In the past few months, all major issues with dealers have been addressed. We appeal to dealers to not inconvenience the public with a strike, especially during the festival season.”

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