Policy
India Will Navigate The Oil Market Amidst Rising Tensions In The Middle East
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Hindenburg-Hit Adani Group Bounces Back Stronger
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Petrol Up 117%, Diesel Up 31% : Changing Consumption Trends In India In The Last 10 Years
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Oil India To Go ‘Beyond Limits’ To Boost Production
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Indian Refineries’ Highest Ever Crude Processing In FY ‘24
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Regulation
GAIL, HPCL Creating Fresh Capacity: India Seems Heading For A Glut In LNG Regasification Capacity
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A Seemingly Irreverent Combination: IndianOil, Panasonic To Form JV To Make EV Batteries
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Reactivating Idling Gas-Based Power Plants
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Sanctions Against Russia Triggered Default: GAIL’s Demand For Compensation Contested By SEFE
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Alternative Energy / Fuel
Solar Is The Prime Focus In Alternate Energy
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New Projects
Petregaz India Commissions LPG Import & Storage Terminal At Krishnapatnam
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ONGC Awards Contracts For Flagship Block In The Krishna Godavari Basin
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Market Watch
India’s Import Dependence On Crude Rises
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Companies
Pratham EPC Projects Ltd
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Gujarat Gas, IndianOil Ink MoU To Broaden Services
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SHM Shipcare & ONGC Introduce India’s First Fast Crew Boat Vessel
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Man Industries Obtains Shell Global Nod For Steel Pipeline Coating
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Press Release [FREE Access]
Petro Intelligence » Plug The Corruption In Pumps

Narendra ModiThere is a rot within – and it’s eating into the vitals of the system. The canker at the root stems from the corruption that is endemic in Indian society. And sometimes, just sometimes, one is tempted to ask which came first: the corrupt, or the system that perpetuates corruption in one long, iterative cycle.

One simple story will illustrate just how well-entrenched corruption really is and just how helpless people are in the stranglehold of the sinuous, coils of corruption. It was exactly 25 years ago that Samachar Apartments, a cooperative housing society of Delhi journalists, came into existence. Mayur Vihar, Phase- I was a backward region within a thriving, but still small, metropolis. And that was one of the reasons why there was no Mother Dairy milk booth nearby. Purely as a temporary arrangement, the milk cooperative Mother Dairy sanctioned a booth at Samachar complex that was run by a peon at a newspaper office with the support of his family of four.

His family’s total daily income from the milk business, based on the legally allowed commission, was a princely Rs 26. Mother Dairy had an inspection agency of its own that visited every outlet frequently to see how ethically the business was run. Its members had to be kept in good humour, failing which an adverse report would be filed against the booth.

Dharmendra PradhanOur friend who managed the dairy booth at Samachar Apartments refused pay a bribe to the inspectors as he did not dilute the milk in order to make money. Though a low-level employee in terms of position and income, he was a man of principle and considered adulterating milk a crime. The inspection agency then advised him to mix milk with water so that the enhanced income could be shared. He refused to do so and the milk booth’s tenure was not extended.

This episode immediately comes to mind at a time when petroleum experts have started debating the future scenario of the petroleum retail outlets in the country. There are over 51,000 retail outlets in the country, the bulk of which belong to the three Oil Marketing Companies: IOC, BPCL and HPCL. Private players such as RIL and Essar account for less than 5 per cent. Shell too has a negligible presence. Most of these have been closed as it had become uneconomic to operate them when they were denied the subsidy that the government extended to the state-run oil marketing companies.

B. AshokThe Modi government has ambitious plans to sanction more retail outlets so that petroleum products can reach every nook and corner of the country. But the basic issue is not the number of retail outlets, but rather the quality and quantity of products coming out of them. Are the citizens of this country entitled to unadulterated petrol and diesel without being short-changed on the quantity they pay for.

This correspondent is one of a lucky few who has been able to get quality petrol without being short-weighted. A friend working for Bharat Petroleum advised me to buy petrol or diesel only from the company-run outlet that is close to my house (not Samachar). Two kilometres away, there is another company-run outlet belonging to HPCL. These outlets are not crowded because this secret is not known to many vehicle owners. Compared to the previous outlets from where I sourced petrol for months, I save two litres for every 20 litres and am assured of unadulterated fuel.

Blame it all on the politicians who not only adulterate the political discourse but also the fuel supply network in this country. A large number of retail outlets are owned by politicians and, invariably, the uncoutS. Varadarajanh variety. All OMCs have an inspection wing and carry out mandatory checks. Oil companies do not dare take action against the politically powerful retailers. What happened to IOC’s Manjunath is still fresh in memory.

There are genuine businessmen as well who find the survival difficult because of the poor commission they earn on the sale of fuels. For years, political parties in power have been mopping up election funds through the allotment of retail petrol outlets. The kickback did rise to as high as Rs 10 million per outlet. How will they recover the investment? The paltry commission won’t pay for the kickback. So, they must adulterate the fuel and resort to meter manipulations to make a quick buck.

Things can improve if the private sector retailers are allowed to compete on even terms. That seemed imminent when RIL and Essar opened 1400 outlets each a few years ago. But alsas, it wasn’t to be. The private players are now trying to reactivate at least half of their outlets. Even if all their outlets become active, they won’t have much of an impact without solid backing from the political leadership.

Nishi VasudevaThe PSU Oil Marketing Companies have a capable leadership. Prime Minister Narendra Modi has to take a deliberate decision and empower the managements of OMCs to ensure the quality of fuel. This is a tough task. Only a management that is respected and backed by the administrative ministry can be expected to deliver. The situation may call for Prime Minister’s intervention.

The first major measure the government should adopt is to end the racket surrounding the supply of subsidised kerosene, most of which finds its way to diesel pumps for adulteration. It must also stop the pernicious practice of paying kickbacks for petrol pump allotments – a situation that blighted allotments during the earlier NDA and UPA regimes.

The Modi government should evolve professional criteria for picking the beneficiaries with the help of reputed agencies while allotting new outlets. Simultaneously, the government should create a professional inspection agency, independent of OMCs, which can squarely deal with the problem of fuel adulteration across the country.

 



To download the latest issue 'Volume 31 Issue 1 - April 10, 2024', click here
Petro Intelligence [FREE Access]
Crude Imports: The High Stakes In A Game Of Russian Roulette
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Sweet Factor Blunts Appeal Of US Crudes
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Greatest Uncertainty Faced By The International Oil Industry
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Calling The Bluff On India Busting Russian Sanctions
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Foreign Investment
Sumitomo To Enter City Gas Business In India
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Overseas Investment
Sanctions Against Venezuela Hit ONGC Videsh
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Gas Scene
Domestic Natural Gas Scene in FY 2023-24
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Sectoral Consumption of Natural Gas (Qty in MMSCM) in February 2024
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Domestic Natural Gas Scene Presents A Bright Picture In February 2024
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Sector-wise Consumption Of Natural Gas
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Higher LNG Imports Elevate Natural Gas Consumption Level in January 2024
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Near Total LPG Penetration Achieved
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India’s Fluctuating Gas Import Dependency
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Gas Transportation Major GAIL’s Physical Performance
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Growing CGD Sales In India
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Domestic Natural Gas Scene In December: Targets Elude, Production, Consumption More
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India’s LNG Import: Import Quantity Shrinks As Prices Go Up
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India’s LNG Import Picks Up As Market Prices Fall
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Sectoral Consumption Of Natural Gas
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Production Targets Confuse Domestic Natural Gas Scene In November
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Shale Gas & Oil Eluding India
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Domestic Natural Gas Scene in October 2023
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Data Section
Monthly Upstream Data
Monthly Downstream Data
Historical database
Data Archives
Special Database
Petroleum Products Consumption Trend In FY ’24
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Shrinking Domestic Share In Petroleum Products Consumed
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Impressive Growth In Petroleum Products Consumption in FY 24
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Actual Capital expenditure of PSU oil companies In FY 2023-24
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India’s Crude Oil Import Marginally Down In FY 2023-24?
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How Does BPCL’s Marketing Operations And Efficiencies Compare With Other OMCs’?
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OVL’s global footprints, operations and contribution
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Indian Crude Basket Price In March 2024
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HPCL’s Expansion In Refining And Marketing Infrastructure
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IOC’s Huge Expansion Projects
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Power Shortage Continues In Many Regions, Promotes Diesel Sales
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Analysis Of Petroleum Products Consumption Trend During FY 2023-24
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BPCL’s Widening Global Upstream Footprints
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Impressive Auto Sector Growth Pushes Up Petrol Consumption In February 2024
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Petroleum Products Consumption Grows 5.7 % In February 2024
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Tenders [FREE Access]
PetronetLNG
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OMCs
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