New government hurdle to setting up petrol pump chain
New companies with plans to set up a chain of petrol and diesel pumps must build 11% of their total planned outlets in "low service areas," according to oil minister Ram Naik.
Speaking on 10th May to a parliamentary committee, Naik said this condition is mandatory for all new entrants into the retail sector. "Low service areas" include remote, far-flung and hilly areas, which are unlikely to be profitable.
State owned companies ONGC and Numaligarh Refineries and the private sector Reliance Industries and Essar Oil have sought permission to set up retail marketing networks. It's understood permission is likely to be granted this week.
At present only state-owned companies Indian Oil, IBP Petroleum, Bharat Petroleum and Hindustan Petroleum are permitted to set up retail outlets.