November 29, 2001
'20'
INTER-MINISTERIAL MEETING ON GASOHOL HELD
The Minister of Petroleum and Natural Gas, Shri Ram Naik said here today that the Union Government have taken a major decision to amend the Sugar Development Act, 1982 so that production of ethanol and power generation from bagasse would get financial assistance from the Sugar Development Fund. While chairing a Minister level Inter-Ministerial Meeting on expanding use ethanol for blending with petrol, Shri Naik said this would give impetus to our efforts in increasing the use of ethanol for blending with petrol and for an efficient use of the entire quantity of molasses currently produced. "The increased returns to the units concerned would naturally flow back to the farmers. With stable and assured payments, the farmers would also gain in this process. The concessional loans for modernisation/rehabilitation of the sugar factories/distilleries would lead to an inductive growth of other ancillary sectors", Shri Naik added.
The Minister emphasised the importance of the use of ethanol for blending with petrol. He said that apart from contributing to a cleaner environment, its contribution to the growth of agriculture sector would be tremendous. Shri Naik stressed that with the increased demand of ethanol, the sugar cane cultivation and industrial activity on account of larger ethanol production in the country would stimulate more growth in the primary as well as secondary sector.
The Government had launched three pilot projects at Miraj and Manmad in Maharashtra and Bareilly in U.P for ethanol blending with petrol. Based on the experience gained so far and the findings gathered in these three pilot projects, ethanol blending with petrol has been a success and there would be no technological or managerial difficulty. The Government, therefore, have now decided to introduce the sale of gasohol i.e. 5% ethanol blended petrol throughout the country in stages.At the same time Rs 4 crore is being sanctioned for initiating research studies on ethanol blending with diesel, since diesel consumption as an auto fuel in the country has been the maximum. Further, efforts are also on to study ethanol blending upto 10% with petrol in the areas covered by the three pilot projects and to see whether any change in the existing technology in the auto mobile sector is required or not.
For successful accomplishment of this ambitious target, Shri Naik asserted that combined efforts of the Centre and States would lead to the desired results. In order to encourage the use of gasohol widely, it would be necessary to price it well below the price of MS. But with the current duty structure, sales tax and other levies at the State level, this would be very difficult. Unless the Union Government and the State Governments extend the support at this juncture with various duty and tax concessions, it may be difficult to price gasohol competitively.
The Meeting was attended by Shri Shanta Kumar, Minister of Consumer Affairs, Food and Public Distribution, Shri Ajit Singh, Minister of Agriculture, Shri Santosh Gangwar, Minister of State for Petroleum and Natural Gas and Shri Annasaheb M.K.Patil, Minister of State for Rural Development apart from Dr. Narender Kumar Singh Gaur, Minister of Sugarcane Development, Sugar Industries (U.P.Government). They appreciated the efforts of Petroleum Minister and his Ministry in implementing the projects to blend ethanol with petrol. It was emphasised that the blending of ethanol with petrol a bold step which would help create a new opportunity for farmers to increase their returns and also the growth of anew industry.