BPCL privatization to help break state-led oligopoly, says FinMin

The decision to privatize profitable oil marketing company Bharat Petroleum Corp. Ltd (BPCL) is based on the reasoning that the presence of a private sector player would break the state-controlled oligopoly and benefit consumers, the finance ministry said on Monday.

“The recommendations made by NITI Aayog in the case of BPCL were based on the reasoning that oil marketing companies are profitable entities in a state-controlled oligopoly that has a significant investment cycle ahead. It would vastly improve efficiency in the marketplace and provide benefit to consumers, if the oligopoly became more competitive with the material presence of a private sector participant that would compete to enhance its share while bringing best practices to the industry,” junior finance minister Anurag Singh Thakur said in the Lok Sabha in a written reply to a question.

The Centre has approved the sale of its entire 52.98% shareholding in BPCL, along with the transfer of management control to a strategic buyer.