On 13 August 2021, the Industries Minister of Bihar, Syed Shahnawaz Hussain called on Union Petroleum Minister, Hardeep Singh Puri in Delhi to seek the removal of the bottlenecks the state government is experiencing in setting up ethanol plants.
The Bihar government has received proposals worth Rs. 30,382.15 crore for setting up ethanol plants, Syed Shahnawaz Hussain claimed during the meeting. Although most of these proposals have been cleared, banks are not willing to finance the projects due to the lack of provisions pertaining to tripartite agreements, he added.
This bottleneck can, however, be removed with the help of Union Petroleum Ministry, provided 7-year tripartite agreements are facilitated between oil marketing companies, banks and ethanol units. This is make way for 100 per cent buy-back of ethanol, and consequently allow expeditious setting up of these units, he opined.
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The ministry needs to ensure that a tripartite agreement is signed for 100 per cent buy-back, he said
Besides this, he also demanded from the Union minister, maximum ethanol sourcing quota for the state, since there is greater availability of the raw material required for ethanol production in Bihar.
A higher quota will help fulfil the biofuel mission of the Centre, and also help fast-track the state’s industrial development, Syed Shahnawaz Hussain declared.
Notably, under the National Biofuels Policy notified in 2018, the Centre is targeting to achieve 20 per cent blending in petrol by 2023. Initially, the deadline for achieving this target was 2030, which was later pre-poned to 2025.
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Following the final pre-ponement of the deadline to 2023, the Centre had reached out to several states for promoting ethanol production. Bihar is the country’s first state to have come out with an ethanol production promotion policy for boosting industrial development.
