The All India Petrol Pump Dealers Association (AIPDA) on May 27 said that it has asked its members to not shut down their petrol pumps as a form of protest after their meeting with petroleum ministry officials.
Dealers' associations from Telangana, Rajasthan, Andhra Pradesh, Maharashtra, Himachal Pradesh, Delhi, Bihar, Tamil Nadu, parts of Kerala and West Bengal had said that they will observe a ‘no purchase of fuel’ day, as part of their protest against short supply of fuel and reduced excise duty by the central government.
AIPDA, which represents 22 state fuel dealers associations in India, at a press conference on May 27 said that they have met officials from the petroleum ministry, who have assured them that their demand will be fast-tracked and that the centre will set up a meeting between fuel dealers and oil marketing companies.
"Oil companies should raise dealers' commission on the sale of petrol and diesel to 5 percent of retail price as operating costs have risen," said AIPDA President Ajay Bansal.
Dealers' commission is decided by a five-year-old formula that has fixed as well as variable components.
"On average, dealers are currently getting a commission of Rs 3.78 per litre of petrol in Delhi. On diesel, it is Rs 2.57 per litre. As a percentage of retail price, the current commission is about 3.9 percent for petrol and 2.9 percent for diesel," said Bansal.
The dealers' commission hasn't been revised for the past five years even as operating costs and facilities at pumps have increased, Bansal added.
He also said that while oil companies, in November 2016, had agreed to review dealers' commission every six months by factoring in the operating cost, nothing has been done so far.
He added that dealers across India have suffered losses amounting to around Rs 2,100 crore due to sharp drop in excise duty on May 21.
Bansal said that fuel dealers in India had paid duties for their stock but couldn't recover it from customers. When duties rise, dealers make proportionate gains.
AIPDA has also asked the central government to consider a mechanism to protect dealers when duties are substantially cut.
Furthermore, the national dealers' body has asked the government to include fuel under goods and services tax and has also asked all state governments across the country to come to a uniform value-added tax rate for petrol and diesel.
"Inclusion of petroleum products in GST will help reduce the rate of petrol and diesel in the country to Rs 75-80 per litre," said AIPDA.
In order to protect the investments of petroleum dealers, the industry body has also requested the government to start distributing alternate or futuristic fuels from existing fuel pumps.
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