OilMin to seek EC nod to raise fuel dealers' commission

May lead to increase in retail prices of petrol, diesel

The Ministry of Petroleum and Natural Gas is to ask the Election Commission of India to allow it to announce a rise in the commission oil companies pay their dealers, before the coming festive season.

The rise is likely to be passed on to consumers through an increase in retail prices.

The ministry was looking into the demand by dealers for a rise in the commission of at least 42 paise a litre on petrol and 27 paise on diesel. A decision was planned by Diwali. However, the declaration of elections to five legislative assemblies came first. This brought the model code of conduct during elections into effect, from October 4. The votes would be counted only on December 8.  

According to sources, Petroleum Minister M Veerappa Moily has directed his officials for a request to the ECI.

The commission hadn’t been raised for a long while and the Federation of All India Petroleum Traders (FAIPT) had threatened a strike.

Currently, dealers are getting Rs 1.74 a litre for petrol and Rs 1.07 a litre for diesel.

Ajay Bansal, general-secretary, FAIPT, said,“We had a meeting with the minister and he assured us of taking up the matter with the Election Commission. Our commission has not been increased despite several hikes in petrol and diesel prices and also after measures like diesel decontrol. If the government delays the decision till elections are over, then some other election may come into the picture.”

The association represents about 42,000 dealers, employing, they say, about a million employees in all.

The Federation of All India Petroleum Traders  also wants implementation of all suggestions of the panel, formed in 2010 under the chairmanship of Apoorva Chandra, then joint secretary (marketing) in the ministry. It was asked to recommend a suitable mechanism for fixing the dealer commission. After taking suggestions, it had suggested a review of the commission every six months.

It also had suggestions related to increase in evaporation count, charges to be applicable for free facilities in petrol pumps and on the number of employees in a fuel station.