Nitish asks Centre's help to develop Bihar as ethanol hub

In a bid to develop Bihar as an ethanol hub, Bihar Chief Minister Nitish Kumar today urged the Centre to ensure presidential assent to the legislation passed by the state legislature and relax the amendment of the Sugar (Control) Order.     

The NDA government in the state has planned to promote the ethanol hub and export ethanol to help boost Bihar's economy. Several entrepreneurs had come forward with proposals to set up their ethanol units, he said here.     

Kumar said he wrote to Union Agriculture Minister Sharad Pawar today informing him that the state government had initiated certain amendments to Bihar Sugarcane Regulation of Supply and Purchase) Amendment Bill, 2007 seeking teeth to facilitate production of ethanol from sugarcane juice.     

The bill was passed by the state legislature in March 2007 and forwarded for Presidential assent.     

The State Investment Promotion Board (SIPB) had approved 13 mega projects - 10 of them sugarcane based and three maize based for ethanol production. The proposed capacity of the sugarcane based ethanol plants was 25,000 tonnes crushing per day and each of the maize based plants would produce 1,25,000 tonnes of ethanol and 36,000 tonnes extra neutral alcohol apart from other chemicals and products, he said.  

Referring to Pawar's statement in Parliament on July 21 on Bihar's plans for promoting production of ethanol directly from sugarcane juice, Kumar said his arguments were not in consonance with the facts.     

Kumar said in 2008-09 the total consumption of Motor Spirit (MS) was reportedly 11.26 million tonnes and that of HSD was 51.67 million tonnes.     

If the centre's policy was to mandatorily blend up to 10 per cent with motor spirit and later also cover HSD, the requirement of ethanol would be very large, he said.     

''Even to meet 10 per cent target for MS will be stupendous as the demand of the chemical sector will also have to be met,'' Kumar said.

As regards the price of ethanol, he said the rate of Rs 22.50 per litre was fixed nearly six years ago when crude price and petroleum product prices were nearly half of the current price.     

''There is enough justification for having a relook at the price being offered for ethanol by the peteroleum companies and therefore, the price difference between sugar and ethanol is artificial one not based on market driven factors,'' Kumar said.      

The unviable scenario would change if ethanol price was reworked by the petroleum companies, he added.