Ethanol interest subvention scheme- Updates

February 18, 2023

The Government of India recently approved nine ethanol blending projects. These projects are to be implemented under the Ethanol Interest Subvention Scheme. The newly added projects are expected to produce 35 crore litres of ethanol. Of these nine, three are molasses based and five are grain based. Around Rs, 1,034 crores of investments are expected on these projects. Also, the projects will create hundreds of employment opportunities.

Background

The Government of India had already approved 1,481 crore litres of ethanol projects under the Ethanol Interest Subvention Scheme. India has been promoting ethanol and ethanol-blended fuels on a large scale in recent times. Recently, India launched ethanol-blended petrol. And the blending ratio was increased to 20%. Brazil and USA are the world’s leading manufacturers of ethanol fuel. Sale of the fuel in these countries is also big. While they have reached 100% ethanol blending, India is a bit lagging compared to them. However, compared to the development programmes of ethanol-based fuels in the past 20 years, the growth rate has been exponential in the recent five years. Another reason for India’s slow ethanol production is the country’s focus on green ethanol. India is trying to generate most of its ethanol from agricultural waste, especially from sugar cane. The natural way of producing ethanol is time-consuming.

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