Disinvestment blues

Purchase of BPCL by IOC would hurt the sector

The government is reportedly planning to sell its stake in state-controlled petroleum major Bharat Petroleum Corporation Ltd (BPCL) to Indian Oil Corporation Ltd (IOC) — which, like BPCL, is a state-controlled oil-marketing company. The sale will produce an oil-marketing behemoth, controlling fully two-thirds of the petrol pumps in India and over 40 per cent of India’s refining capacity, as well as a majority of the aviation fuel stations. However, the government does not seem to be interested in the economies of scale. What it needs is the money it will receive from IOC in return for its 53 per cent