The scheme approved by the Union Cabinet to boost the production and use of ethanol for blending with petrol has pros and cons which need to be weighed judiciously before its implementation. It envisages a 6 per cent interest subvention to put up ethanol distilleries or expand the existing ones to raise the installed ethanol production capacity to 17.5 billion litres by galvanising an investment of Rs 40,000 crore. This would facilitate raising the ethanol blending of petrol to 20 per cent, from the present less than 10 per cent, by 2025, far ahead of the target date of 2030. This objective, prima facie, is a good one because it can help restrain vehicular emission and reduce oil imports.
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