Petrol pumps across the country will go on strike from September 20, with a petroleum traders' union warning of "no money, no purchase, no sale..." after talks with the Oil Ministry to hike the rate of commission on fuel sales fell through.
At present, commission is paid to petrol pump owners as a fixed margin. The ministry was of the view that accepting the demand will increase the burden of the oil marketing companies, which are expected to suffer losses of over Rs 50,000 crore (Rs 500 billion) in 2010 -11 on account of fuel subsidies.
The meeting was also attended by senior officials of the oil marketing companies. "We are continuing with our agitation. This will be a non-cooperation movement on our part... No money, no purchase, no sale from September 20," Federation of All-India Petroleum Traders (FAIPT) General Secretary Ajay Bansal said.
FAIPT claims to represent 37,800 petrol pump dealers.
Last week, the government had increased the dealers' commission by 9 paise a litre for petrol and 8 paise for diesel, due to which auto fuels prices in the country had increased by 9-13 paise a litre.
However, terming it an ad-hoc solution, the FAIPT has maintained that dealers should be paid a commission of at least 5 per cent of the invoice value.
"We are still ready for talks as we do not want to cause any inconvenience to the public. However, we are forced by the Petroleum Ministry and the oil marketing companies to take this extreme step," Bansal added.
Some of the other demands of the FAIPT include a freeze on establishment of new retail outlets, as mushrooming growth of petrol pumps is affecting the business of existing dealers.