In one of the biggest expansion plan since the Independence, three public sector oil companies — Hindustan Petroleum Corporation Limited, Indian Oil Corporation Limited and Bharat Petroleum Corporation Limited — are planning to set up 30,000 outlets all over the country. The move comes when these companies state that they are not in a position to buy crude in December.

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Of the 30,000 outlets, Karnataka will get 3,000 outlets, concentrated mainly in the interior, rural and coastal areas. Each outlet in the urban areas will cost no less than Rs1 crore- Rs1.5 crore and Rs50 lakh- Rs75 lakh in rural and interior areas.

Chairman of the Akhila Karnataka Federation of Petroleum Traders, Bangalore, GV Bhushan Narang said that the oil companies were misleading the country with false promises to entrepreneurs. "Their advertisements and promos say that those who own a petrol pump can get steady and perennial income, but their marketing discipline guidelines (MDG) are not conducive for healthy growth of petroleum retailing in the country. The companies have deregulated petrol, but diesel and a host of other products are still in limbo," he said.

Numerous studies, including three at the national level, have been carried out to assess the condition of oil retailing in India. These reports are gathering dust. In the past four years, Indian Institute of Management-Ahmedabad, Indian Institute of Technology, Mumbai, and Indian Institute of Petroleum, Dehradun, have carried out studies on petroleum retailing.

This year too the petroleum ministry commissioned Rashmi Jain, an IAS officer, to take up a study. Even before the report could be published, all parameters she had applied were nullified with the government increasing the price of petroleum three times. All these reports are now confined to the shelves of the companies as well as the oil ministry.

"We've, through our apex body, represented the cause of 'right regulation' of petroleum retailing in the country to the ministry many a time in the past. But the ministry had stuck to its own economic model, which has rendered 40% of the pumps unviable and retailers are running away from the business in Karnataka," said K Vishwas Shenoy, president, Dakshina Kannada Udupi Petroleum Dealers Association.

"We've reports that four petroleum retailers from north India have committed suicide after being sucked into a debt trap due to losses. The Federation had also noted that over 20% of the retailers wanted to quit and 40% of the establishments were sick," said Sathish Kamath, an oil retailer in Mangalore.

If a petroleum retailer was not able to sell 150 kl per month, he is doomed. The MDG requires the petrol pump owner to maintain generators, adequate manpower to work in two shifts, high quality pump, toilet, drinking water, air compressors, windshield washing system, spacious premises, and computerised operations.The urban pumps can have their own concessionaires such as ATMs, utility stores and even lube stores, but the income from those will have to be remitted to the account of the oil companies. This is yet another bone of contention between the pump owners and the companies.

The companies also do not take into consideration the evaporation count. It is stated that 0.4% of the stocks get evaporated every day, on account of which the pump owner loses not less than `4,000 per week, if his tank was half.

Kerala and Haryana have already secured stay orders through their respective high courts on expansion of retail petroleum business in their respective geographical areas, while Rajasthan and Maharashtra are considering taking legal recourse.State petroleum dealers said they will take a decision on the issue at a conference held in Kundapura on November 26 and 27. They will also appeal to the ministry to cancel the ad-valorem tax of 5%.