The expanded interest subvention scheme will fuel investment of about Rs. 40,120 crores in the Ethanol value chain, encouraging Urja-Kheti, which will augment farmer’s income, says Union Minister of Petroleum and Natural Gas & Steel Dharmendra Pradhan.

Dharmendra Pradhan said the government’s decision to expand interest subvention scheme for enhancement of ethanol distillation capacity will transform our annadatas into urjadatas and contribute to the overall vision of Aatmanirbhar Bharat.

The Union Cabinet chaired by the Prime Minister has approved the expansion of interest subvention scheme to provide financial assistance for enhancement of ethanol distillation capacity from grain-based distilleries along with molasses-based distilleries. The total outlay under the interest subvention scheme is estimated at Rs. 8,460 crores.

The Ethanol Blending Program (EBP) which started in 2003, got renewed thrust under the leadership of Prime Minister Narendra Modi. Due to progressive, reform oriented approach and series of steps taken in the last six years, ethanol procurement has gone up from 38 crore litres in 2013-14 with a value of around Rs. 1,500 crores to estimated procurement of 325 crore Litres in sugar year 2020-21 with an estimated value of Rs. 19,000 crores.

The price of ethanol procurement has also gone up from around Rs. 39 per litre in sugar year 2013-14 to an average price of Rs. 58 per litre in sugar year 2020-21. This progressive increase in prices has helped augment farmers’ income.

The blending percentage of ethanol in petrol has gone up from 1.53% in 2013-14 to 5% in 2019-20 and estimated to be 8.5% in 2020-21.

The government has set up an ambitious target of 10% ethanol blending by 2022 and 20% ethanol blending by 2030 which will require additional capacity to be added. The recent decision will facilitate capacity addition and greater Ethanol blending will immensely help in import substitution, savings of foreign exchange and environment sustainability.