LPG dealership expansion gains pace

Oppn-ruled states not co-operating with online bidding, say sources

The plan by state-run oil marketing companies (OMCs) to expand its liquefied petroleum gas dealership has gathered momentum with the addition of 2,156 dealers in the past two months across 23 states.

The road map is to appoint 6,149 distributors across the country through an online selection process, which might see an investment of ~2,000 crore in the industry. However, sources said some opposition-ruled states such as West Bengal were not co-operating with the online bidding process despite several letters from the ministry of petroleum and natural gas and the OMCs — Indian Oil Corporation (IOC), Hindustan Petroleum Corporation (HPC) and Bharat Petroleum Corporation (BPC). “Out of the advertised locations, 2,156 have been covered so far, with Tamil Nadu and Rajasthan having the maximum number. Our target is to have at least one distributor every 7.5 to 10 km,” said a source close to the development.

Kolkata-based MSTC is conducting the online draw for the OMCs. This is for the first time that OMCs have changed the selection process from physical to the digital mode, with the introduction of online receipts of application, processing and online draw. This initiative of the ministry is part of promoting Digital India and to bring more transparency and accountability in the selection process. It is also part of the goal set by Petroleum Minister Dharmendra Pradhan to increase liquefied petroleum gas (LPG) penetration to 95 per cent by 2020 from 74 per cent.

Regarding non-cooperation from Bengal and some other states for the expansion

plans, a source said, “Nearly five million PMUY consumers are from West Bengal alone. So there is an urgent need to allot distributorship to more people for smooth supply. This is being put on hold due to political reasons.”

There are around 19,000 agencies and the government wants to increase that to 27,000 by 2019.

Among the new distributors, 3,000 would be for IOC, while BPC and HPC would have 1,500 each. Meanwhile, the Cabinet is likely to take a call next month on a proposal to increase the reach of PMUY schemes by adding 30 million connections.

In the past two years, the BJP-led government was also successful in increasing LPG reach by more than 18 per cent. To achieve this target, the Centre had launched the Pradhan Mantri Ujjwala Yojana to provide 50 million LPG connections in three years to below-poverty-line families, with a government support of ~1,600 a connection.

So far, 32-million LPG users have been added under the scheme.