The Union Ministry of Petroleum and Natural Gas is expected to announce an increase in margins for petrol and diesel dealers by the end of this month, industry representatives said on Tuesday.
"Final announcement is slated for July 31. Dealers expect the proposed hike will be made in the realistic and justified manner and it should be based on current expenditure,'' said Ravi Shinde, president, Petrol Dealers Association, Mumbai.
"Talks with the auto fuel dealers and the oil companies are regularly taking place in the presence of the petroleum minister Dharmendra Pradhan," said sources in the ministry.
The margin on petrol is expected to increase by 70 paise per litre and by 47 paise per litre for diesel. The proposed hike in dealer margin will be passed on to the consumers, in line with the recently-introduced dynamic pricing that benchmarks prices on a daily basis to global prices. However, the margins will differ from state to state.
Dealers of auto fuel, who number about 56,000 nationwide, had earlier threatened they would curtail operating hours and stay closed on Sundays, claiming the current margins do not leave them room for operating expenses.
Fuel dealers' unions argue that the margin should be revised as per the recommendations of the Apurva Chandra Committee made in 2011.
Shinde said that one of the key recommendations of Committee was that the commission should be fixed in proportion with expenses, which vary from state to state. The margin should also differ from company-owned ones to dealer-owned ones, he said.
Of the 56,000 dealers, 70 per cent have low sales and won't be able to survive even after the revision in the margin. "Therefore, the Consortium of Indian Petroleum Dealers has argued that these dealers need to be provided with an additional compensation not only to survive but also face the competition," Shinde said.
