Opening petrol pumps in India is the dream of many people. It has become an attractive business option due to increasing vehicle number and frequent demand for fuel. But do you know how much money is required to make this dream come true? Let's know about the entire process, cost and possible profits of opening petrol pump.

How much will it be spent?

You will need a hefty amount to open a petrol pump. This cost in urban areas can range from around 2.5 crore to 3.5 crore rupees. In rural areas it can be a little less, about 1.5 crore to 2 crore rupees. This expenditure includes the price of land, infrastructure, equipment, and working capital.

Land and infrastructure: biggest expenses

Land is the most important and expensive part for petrol pumps. Urban areas require 800-1200 square meters and 1200-1600 square meters on the highway. The price of land can range from 50 lakh to 2 crore rupees according to the location. Apart from this, about 1 crore to 1.5 crore rupees can be spent on tanks, pumps, buildings etc. in infrastructure.

License and permissions: necessary but expensive process

Many types of licenses and permissions are required to open a petrol pump. These include licenses from Petroleum and Explosive Safety Organization (PESO), approval of pollution control board, and permission from local bodies. For all these you may have to spend from about 50,000 to 2 lakh rupees.

Working capital: necessary to run business

You will need working capital for early stocks, salaries of employees, and other everyday expenses. This amount is usually between 15 lakh and 20 lakh rupees.

Commission and profits: how much can you earn?

Petrol pump owners get commission on sales per liter. Recently, oil companies have increased the dealer commission. Now 65 paise per liter on petrol and 44 paise per liter on diesel. Apart from this, a fixed commission of Rs 1,868.14 per kiloliter on petrol and Rs 1,389.35 per kiloliter on diesel is also available.

An average petrol pump where selling 3,000 to 4,000 liters daily can be around 2.5 to 3 lakh rupees. However, this figure can change on the basis of location and sales.

Eligibility and application process: Are you eligible?

To open a petrol pump, you should be between 21 and 55 years old. In terms of education, it is necessary to have at least 12th pass for urban areas and 10th pass for rural areas. You have to prove that you have enough money for investment.

The application process is online and you can apply by visiting the website of companies like IOCL, BPCL, or HPCL. The application fee is Rs 15,000 for rural areas and Rs 50,000 for urban areas.