The Hindu : Front Page : Maharashtra Chief Minister agrees to remove export duty on ethanol

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Wednesday, Jan 09, 2008
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Maharashtra Chief Minister agrees to remove export duty on ethanol

Sandeep Joshi

This will facilitate the supply of excess ethanol to other States

Use of alternative fuel sources ensures energy security
The initiative is environment friendly

NEW DELHI: In what could be a major step towards successful implementation of the “National programme for supply of ethanol-blended petrol (EBP),” the Petroleum & Natural Gas Minister Murli Deora on Monday succeeded in convincing Maharashtra Chief Minister Vilasrao Deshmukh to remove the export duty on ethanol, facilitating the supply of excess ethanol from Maharashtra to other States.

After his meeting with Mr. Deora in Mumbai, the Maharashtra Chief Minister announced the withdrawal of the export fee of Rs.1,500 per kilo litre (Rs.1.5 per litre), now being imposed on ethanol supplies to other States. “This will ensure supply of excess ethanol from Maharashtra to other States, thus making the ambitious programme run successfully in many States and Union Territories. It will also benefit sugarcane farmers of Maharashtra,” Mr. Deora said while reacting to the announcement.

The Petroleum Minister stressed that the EBP programme (5 per cent blending of petrol with ethanol launched on November 1, 2006) is aimed at contributing to energy security through the use of alternative fuel sources and also help sugarcane farmers earn additional income.

This initiative is environment friendly as the oxygenate nature of ethanol ensures greater petrol combustion leading to lesser emission of pollutants, he added.

So far, EBP is being supplied in 11 States and three Union Territories covering about 70 per cent of the identified States. Out of a total requirement of 180 crore litres ethanol for three years, oil marketing companies (OMCs) have already contracted 140 crore litres. They have so far procured 19.35 crore litres under the programme as on December 31, 2007.

The programme in a few States, including West Bengal, Tamil Nadu, Chhattisgarh and Kerala, could not be implemented for various reasons.

Mr. Deora said certain procedural impediments affected the free movement of ethanol across States and to sort it out he had been holding meetings with the State governments concerned.

He raised the issue of rationalisation of octroi duty levied by the Brihan-Mumbai Municipal Corporation (BMC) on crude oil procured by Mumbai refineries of BPCL and HPCL.

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