Oil ministry pushes for ethanol, bio-diesel imports
22 Mar 2007
New Delhi: The petroleum ministry is putting pressure on local ethanol producers by announcing ethanol imports for blending with petrol.
The ministry is going against the earlier policy of relying solely on local production and is now inclined to favour imports of bio-diesel.
The ethanol-blending programme, to be rolled out in the country from November 2006, has been a non-starter, with just about 10 states finalising contracts with ethanol suppliers.
The main issue is the price. This is despite the fact that a consensus on the price of ethanol seemed to be emerging between oil firms and the Indian Sugar Mills Association.
The ethanol suppliers are now asking for Rs26-27 per litre of ethanol, while the oil companies are working on an all-India reference price of Rs21.50 a litre.
Imports of bio-fuels would dilute the bargaining power of domestic manufacturers, besides ensuring uninterrupted supply.
The
sugar industry says at 5 per cent blending, the country
would require 682 million litres of ethanol in 2006-07,
and the demand could rise to 1.3 billion litres with
10 per cent blending.
