Greater competition from private sector players would also help. This would entail reducing the entry ticket cost, which is a staggering Rs 2,000 crore investment commitment at the moment. Today, except for Reliance, that has already notched up a 9% market share in diesel sales with a mere 1,000-odd pumps with the 30,000-strong oil PSUs outlets holding the rest, there is no competition worth the name. What makes matters worse is that pump operators have largely been selected through a rather opaque mechanism laid out by the government. Reservation ensured that only 50% of the pumps were allotted on merit. The result is, on a per pump basis, Reliance outsells the PSU retailers by a factor of four.
All these interventions by the government over time have led to loss of morale in the PSU workforce. In such a scenario, the five-point programme announced by the petroleum minister in Mumbai last week is unlikely to be more effective than any of the past attempts to tackle adulteration. It is high time the government stopped deluding itself that anything short of complete deregulation will address the issue.