India to implement 20-per cent consumption of biofuel by 2017

12 September 2008

Against the backdrop of a runaway rise in fuel prices and global warming, the union cabinet has approved a proposal to double the amount of ethanol to be blended with petrofuels from 10 per cent, scheduled from October 2008, to 20 per cent by 2017, and a uniform 4 per cent sales tax across the country.

The policy also stipulates a certification mechanism for the blending exercise conforming to specifications of the Bureau of Indian Standards.

While petrol will be blended wiith ethanol from molasses, non-edible oils extracted from wild plants like jatropha, referred to as biofuels, will be mixed with diesel, to progressively reduce the country's dependence on imported petroleum fuels.

India currently imports 70 per cent of its fuels to meet its requirments of 40 million tonnes of diesel and between 8 and 9 million tonnes of petrol. Fuel consumption has been rising by around 7 per cent annually.

At present the country has a target of blending 5 per cent of ethanol by volume in petrol, which is scheduled to double to 10 per cent by October, in time for the forthcoming sugarcane crushing season.

Though the policy of blending 5 per cent ethanol in petrol was has been successful, the blending of biodiesel has been stalled by ministerial differences over subsidies, leading several investments in bio diesel refing being put on the back-burner.