Cabinet approves bio fuel policy
New Delhi (PTI): Government on Thursday set 2017 as the target for selling petrol mixed with one-fifth of sugarcane extracted ethanol and diesel doped with non-edible oil with a view to cut the nation's dependence on expensive oil imports.
While petrol mixed with 5 per cent ethanol is at present sold in the country, pilot projects are on to check viability of selling diesel doped with non-edible oil.
The percentage of ethanol in petrol is to double from next month but availability of sugarcane has cast doubts on meeting of the deadline.
The Cabinet today approved implementation of the National Biofuel Policy that has set an indicative target of blending 20 per cent ethanol in petrol and non-edible oil from plants like Jatropha in diesel by 2017, an official statement said.
While oil firms now buy ethanol at Rs 21.50 per litre, non-edible oil for diesel mixing would be purchased at a price linked to prevailing diesel price.
The policy calls for scrapping taxes and duties on bio- diesel and declared goods status being conferred on bio-diesel and bio-ethanol. Declared goods status would mean that the two would attract a uniform central sales tax or VAT rate rather than varied sales tax rates prevalent in states.
Instead of setting up a National Bio-Fuel Development Board, as had been recommended by a Group of Ministers headed by Agriculture Minister Sharad Pawar, the Cabinet constituted a National Biofuel Coordination Committee headed by the Prime Minister.