[EXCLUSIVE] Cabinet will likely increase scope of ethanol production subsidies to grain distilleries

Representation image | Photo credit: PTI

To boost ethanol production in the country, the government has long considered expanding grant loans to grain distilleries under the ongoing program. Sources told ET Now that Cabinet is likely to approve the extension of low-interest loans to grain-based distilleries at today’s meeting.

Sources said officials from the Ministry of Petroleum and Food met last month to reflect on the goal of blending ethanol and that the government believes there is a need to consider d ‘other agricultural raw materials such as rice, corn, sorghum and barley to make ethanol. In order to stay on its target of blending 20% ​​ethanol, the government is keen to implement different ways of purchasing ethanol in addition to sugar cane.

According to the sources, the government will extend the subsidies in the form of soft loans to distilleries that are ready to set up factories where ethanol can be purchased by the grain-based method.

India has an ethanol capacity of over 426 crore liters, of which around 150 crore liters are used to make other products like disinfectants. The Union Cabinet has also recently increased the prices of various grades of ethanol to supply petroleum marketing companies.

With an increase in ethanol supply this year, the government is expected to soon meet its blending target of 10% by 2022.

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