As mentioned earlier adulteration of transport fuels at the point of sale and transportation has become a routine problem in India. There are several petroleum products available in our country, which are close substitute of gasoline and diesel, but are available at considerable lower prices. The price differential is usually in the range of Rs. 8 to 20 in case of petrol and Rs. 5 to 12 in case of diesel. Since kerosene is usually considered as poor man's fuel, Govt. of India has been subsidizing it for public distribution for several years. The subsidy on PDS kerosene during 2000-01 is estimated to be around Rs. 7500 crores. It is common knowledge that significant portion of this subsidized kerosene is being diverted for adulterating diesel. Several studies /survey carried out recently have together pointed out towards alarming rise in the cases of fuel adulteration in our country and some of them are as below:

» Tata Consultancy has conducted an extensive survey on the kerosene distribution pattern within the country. They arrived at the conclusion that more than 30% of Kerosene distribution intended for household consumption through PDS outlets flowed back to industry in one form or the other. This was a clear indication towards the flourishing business of adulteration in our country.

» According to Anti Adulteration Cell of India, Naphtha is a commonly used adulterant for gasoline. The modus operandi is to import the product in huge quantity and divert it for adulteration. In a major seizure a few days ago, the Cell detected import of naphtha through the Mangalore port allegedly for adulteration of auto fuels in Kerala, Andhra Pradesh, Karnataka, West Bengal and Madhya Pradesh. The intention was to import and move the products to a factory in Pondicherry, where it got blended with other adulterant chemicals. Following the investigation, the Cell sealed 82 kL of naphtha, 31 kL of other products along with plant and machinery allegedly used for adulteration.

» Similarly a case of adulteration has also been reported from Uttar Pradesh in the city of Meerut, where an authorized transport company was caught with adulterated stock. This transport agency had the authority to transport both petrol & diesel to retail outlets and solvents for industrial use. The agency was supposedly using its workplace for adulterating diesel with kerosene.

» According to a news in "The Times of India", the State Government of Maharastra loses a whopping Rs. 81 lakh and Rs. 75.6 lakh every month on account of combined sales & excise tax revenue against petrol and diesel adulteration in Mumbai city alone. This is believed to be 10 percent of the genuine sale, industry source reveal.

» Various estimates have been made of the extent of financial loss to the national exchequer as well as the oil companies as a result of diversion of PDS kerosene, use of off-spec, low value, hydrocarbons mixed with petrol and diesel, evasion of sales tax etc. Although these estimates vary over a wide range, it is safe to assume that the nation is losing at least Rs. 10,000 crores annually as a result of adulteration of fuel. If to this is added the social costs as a result of environmental pollution, damage to vehicles and other engines, etc., the loss could be substantially higher.

» With the plethora of foreign car manufacturers making a beeline to set up manufacturing facilities in the country, their first and immediate concern is the quality of petrol that gets supplied to the users' cars. They have uniformly found that supplies are heavily adulterated and particularly the Octane content is much lower than the specification value of 87%.

» Recently under the direction of the Supreme Court, Environment Pollution Control Authority (E PCA) through a local NGO (CSE) carried out tests of fuel samples from retails outlets and other points. The results of the study reveal 8.3 % sample failure of the sample tested against 1-2 percent reported by oil companies in the past. The study further reveals that adulterated fuel in intelligent mix allowed retail outlets to reap a profit of more than Rs 25, 000 a day.