Starting a Petrol Pump is one of the most profitable businesses, especially when it’s located in busy places such as highways or cities. With the rising number of automobiles in India, the demand for petrol pumps is also increasing. Apart from this, when paired with restaurants, hotels, or general stores they can help with extra income. But first, let us understand how to start a petrol pump in India
2. Petrol Pump License: Eligibility Criteria
If you’re an entrepreneur and opening a petrol pump is your startup idea, the first thing you need is a petrol pump license. Here are the eligibility criteria you must pass to do so.
- You must be a citizen of India and between 21 to 55 years old. An NRI must reside for a minimum of 6 months in India before applying.
- The Education requirements differ under the caste system.
- A general category applicant must be 12th pass.
- Others (SC/ST/OBC) must be 10th pass to open an outlet in a rural area.
- A general category applicant must have a University degree to start the business in an urban area.
3. Investment Required To Start Petrol Pump
If you pass the aforementioned criteria the next stage is to prove to have minimum funds to start a petrol pump. Although the requirements may vary from place to place, a general rule of thumb is to prove the ability to invest a minimum of Rs 13 lakh for rural areas and at least 25 lakhs for Urban areas. Here is a list of Funds that WILL be considered:
- Funds in savings Account
- Bonds, Mutual Funds, and Shares (only 60% is considered)
- National Savings Certificate
Here is a list of funds that WILL NOT be considered:
- Cash, Jewellery, material assets, etc.
- Funds in a current account.
If you qualify for all the steps mentioned above you can apply for a petrol pump license.
4. Minimum Land Required For Petrol Pump
If you have a land of your own, great. If not, you can take land on a long-term lease and produce a No Objection Certificate signed by the owner. You need a Long-term lease to compensate for the heavy investment that you’ll make in the beginning. Once the location is decided, the petrol pump, AKA, retail outlets are classified into two categories. Lands on and close to National Highways – Urban and semi-urban areas. These are called Regular Retail Outlets.
Lands nowhere near National Highways – Rural areas. These are called Rural Retail Outlets. Irrespective of the names, the required area of the land will be specified in the advertisement by the Oil Marketing Company (OMC) of your choice. Generally, a land of 800 square meters is the minimum requirement. Once you apply to a company and get selected, there are certain brick and mortar constructions you’ll need to make on the site to start a petrol pump. For example, a solid and levelled road for the vehicles to enter and exit, a compound wall, and safety measures in case of fire hazard.
Leave a Comment