British energy firm BP has received a licence from the government to set up 3,500 petrol pumps in India. It is the second foreign player after Shell to enter the transportation fuel retailing business in the country dominated by state firms which control nearly 95% of the 56,000 outlets. Reliance Industries and Essar Oil are the other private firms fighting for a share in the rapidly expanding fuel market. Between April and August this year, sales of petrol and diesel grew 14% and 6% respectively as more than 7% economic growth powered demand for more fuels by vehicles and factories in the country .
The marketing rights for transportation fuel, including petrol, diesel and jet fuel, are given to a firm investing or proposing to invest Rs.2,000 crore in exploration and production, refining, pipelines or terminals in the country. The firm had first applied for licence to market jet fuel, which it obtained a few months ago.
BP will bring its long experience, global expertise and brand equity to the Indian fuel market that has been dominated by state firms with assured fuel supply, brand recognition and control over marketing infrastructure.