How to get Licence for Petrol Pump in India?
Updated on : Feb. 9, 2023 - 4 p.m. 17 min read.
Are you dreaming of becoming an entrepreneur in the fuel industry? Do you want to know everything about how to get a petrol pump license in India? From the initial steps of obtaining the necessary documents to the final stages of setting up a successful petrol pump business, we will guide you through the entire process. So, let's dive in and explore how you can turn your entrepreneurial dreams into a reality in the fuel industry!
A license for a Petrol pump is given by the government to a person or group to run a petrol pump. The Ministry of Petroleum and Natural Gas, along with its affiliated bodies like the Oil Marketing Companies (OMCs), regulates the granting of petrol pump licenses in India. The license is crucial for making sure that the petrol pump works in a safe and controlled manner and complies with the government's criteria for the storage, processing, and distribution of gasoline and other petroleum products. An application must be submitted, eligibility requirements must be satisfied, and numerous approvals from the government and other necessary agencies must be obtained before getting a petrol pump license.
Basic Eligibility Criteria for Obtaining a Petrol Pump License
- Age: The applicant must be at least 18 years old.
- Residency: The applicant must be a resident of India with a permanent address in the country.
- Educational Qualifications: The applicant must have a minimum educational qualification of 10th standard or its equivalent.
- Land Ownership: The applicant must own or have access to the land where the petrol pump will be installed.
- Financial Capacity: The applicant must have the financial means to invest in the construction, installation, and operation of the petrol pump.
- Background Check: The applicant must pass a background check, which includes a criminal record check and a credit check.
- Experience: Some Oil Marketing Companies (OMCs) may require applicants to have prior experience in the retail fuel business or in a related field.
- Business Plan: The applicant must provide a detailed business plan outlining the proposed operation of the petrol pump, including location, design, and marketing strategies.
- Clearance from Local Authorities: In order to set up the petrol pump in the proposed location, the applicant must obtain permission from the local authorities, such as the Municipal Corporation or the Panchayat.
- Environmental Clearance: For the construction and operation of the petrol pump, the applicant must obtain environmental clearance from the relevant authorities.
Documents required for Petrol pump license in India
To obtain a petrol pump license in India, the following documents are typically required:
- PAN Card of the applicant
- Aadhar Card of the applicant
- Bank Statement for the last six months
- Proof of ownership of the land where the petrol pump is to be set up
- Sales Tax/VAT Registration Certificate
- NOC from the local municipal authority
- Environmental Clearance certificate
- Fire safety certificate
- Building Plan Approval from the local municipality
- Insurance coverage for the petrol pump
- A detailed project report (DPR)
Note: The specific requirements may vary based on the state in which the petrol pump is to be set up. It's advisable to check with the concerned department in the state for the exact requirements.
How to Apply for Petrol Pump License in India?
To apply for a petrol pump license in India online, you can follow these steps:
- Visit the Petrol Pump Dealer Chayan website.
- Click on the "Register Now" button to create an account by providing all the necessary information.
- Log in with your newly created ID and password.
- Look for the available advertisements and select your desired oil company and state where you want to operate.
- From the information displayed on the website, choose your preferred location.
- Click on "Apply Now" and fill out all the required information within the specified time limit.
- Choose whether you want to apply as an individual or a partnership firm.
- Pay the necessary fee and provide your personal details, including a photo and signature.
- Submit your application and pay the required fee.
How much investment/Fees is required to get a Petrol Pump License in India?
The investment and fees required to obtain a petrol pump license in India can vary depending on the oil company you choose to work with and the location of the pump. The initial investment can range from 20 to 50 lakhs INR on average and can include costs such as the cost of the land, the construction of the petrol pump, and the installation of storage tanks and other equipment. You may also be required to pay fees to the oil company for the application process, training programs, and ongoing royalties. It is important to note that these figures are only estimates and that actual costs may vary. It is recommended to get in touch with the oil company you are interested in working with to get an accurate estimate of the investment and fees required to obtain a petrol pump license in India.
Land requirement for Petrol Pump Dealership
The land is a critical requirement for establishing a petrol pump dealership in India. It is not possible to establish a petrol pump and begin selling fuel without a suitable plot of land. Here's what you need to know about the land requirements for establishing a petrol pump dealership in India
- Size of land required: The size of the land required for establishing a petrol pump varies depending on the type of pump, the number of dispensing units, and the fuel storage capacity required. A petrol pump requires an area of approximately 1500 to 2000 square feet on average, but this can vary depending on the oil company you choose to work with.
- Location: The location of the land is also important in the establishment of a petrol pump. It is critical to select a location that is easily accessible to customers, with a high level of visibility and a good flow of traffic. The oil company you choose to work with can assist you in locating suitable locations for your petrol pump dealership.
- Zoning requirements: Before purchasing the land, it is critical to ensure that it complies with the local zoning requirements. This includes ensuring that the land is suitable for commercial use and that it meets the local authorities' standards for the establishment of a petrol pump.
- Cost: Land costs vary depending on location, size, and other factors. The cost of the land can range from 5 to 15 lakhs INR on average, but this can vary depending on the specific requirements of the oil company you choose to work with.
Certificates and Permissions Required for starting a Petrol Pump Business in India
Following are the Certificates and Permissions Required for starting a Petrol Pump Business in India
- Retail Outlet Dealership Agreement: The first and most crucial document you need to obtain is a dealership agreement from the oil company you intend to work with. This Agreement sets forth the terms and conditions of your business relationship with the oil company, including the kind of fuel you will sell, the cost of fuel, and the commission you will earn.
- Petroleum license: A petroleum license is necessary to store and sell petroleum products. All Indian gas station dealers are required to have this license, which is issued by the Petroleum and Explosives Safety Organization (PESO).
- Environmental Permit: The Ministry of Environment and Forestry will also require you to obtain an environmental permit. With this certification, you can be sure that your gasoline pump complies with government environmental regulations and won't harm the environment.
- NOC from the Fire Department: In order to confirm that your gas station complies with government fire safety standards, you will also need a NOC from the fire department.
- Building plan approval: Obtaining building plan approval from your local municipality is necessary for the construction of your gas station. Your building will be compliant with regional building codes and standards thanks to this certification.
- Trade License: You will also require a trade license from the neighborhood municipality for your gas station business. For all businesses operating in India, this license is necessary.
- GST Registration: You must register for GST with the government if you plan to sell fuel worth more than 20 lakh Indian Rupees in a fiscal year.