The government has decided to privatise Petroleum, Oil and Lubricants (POL) Stations, which are run by Farm Machinery Corporation Limited (FMCL), agriculture minister says.
The minister for agriculture and forests this during his recent 12th Five Year Plan’s budget and planned activities’ meeting with local leaders and dzongkhag officials of Bumthang while answering to a concern raised by a local leader.
“The present government is of the opinion that the supply of fuel and gas cylinder business need not necessarily be carried out by the government or a State-Owned Enterprise as it is purely commercial work. Therefore, the cabinet has deliberated on the matter and directed the economic affairs ministry to proceed with the privatisation,” the Agriculture Minister Yeshey Penjor said.
He added that any interested private individuals should go to the economic affairs ministry to get a license to start such a business. The minister said FMCL was not given enough funds when it was established in 2016.
“FMCL’s mandates became heavier while the budget provided remained inadequate. The Nu 1bn meant for FMCL had to be shared with two other new State-Owned Enterprises with each enterprise getting about Nu 33 M. This has affected FMCL in fulfilling its mandates and also shouldering new responsibilities such as running POL stations,” he added.
FMCL said most POL stations have been running into loss, which affected the consistent delivery of services. It has been several months since most of the POL stations across the country have remained closed.
“Right now, our enterprise has some problem with the revolving fund because we have to invest in buying some spare parts and machinery. After studying for one year, we have found that most of the stations are running into loss. We still have a reservation that if the private sector takes over, would the private firms really conform to quality control and check and balance systems? So, we are developing the necessary strategies,” Karma Thinley, the CEO of FMCL, said.
There plans to present the financial analysis and feasibility study of privatisation to the cabinet.
FMCL, however, says that the company would continue to provide other agricultural machinery services even if the fuel and gas cylinder business is privatised.
Meanwhile, people said the POL services have never been reliable and consistent since the stations were established in the gewogs. Besides the sale of lubricants and refilling of gas cylinders, the stations also sell and repair farm machinery and agriculture tools. With the stations remaining idle, people are disappointed about the situation.
“Initially when the station was set up, it benefitted us for about 3 to 4 months. We don’t know what is hampering the company but the station hasn’t provided any service for almost half a year now. With the station being unreliable, we are facing problems with buying fuel and refilling our gas cylinders” Jigme Lotay from Chummig, said.
“If the stations work efficiently, it would be of great service to the rural people. For instance, people travelling to Trashigang via Chummig can refuel their cars at the POL station near Chummig Gewog Centre. Otherwise, they will have to go to Chamkhar,” Rinzin Lhamo, also from Chummig, said.
The FMCL and the Ministry of Economic Affairs (MoEA) established 41 POL stations in 16 Dzongkhags since November 2017.
