HIGHER PROCUREMENT PRICE FOR ETHANOL
Context: Higher procurement price for ethanol purchased by oil marketing companies for the ethanol blended petrol (EBP) programme was approved by the Cabinet recently.
According to the approval given by the Cabinet Committee on Economic Affairs, the price of ethanol derived from C-heavy molasses will be increased from Rs. 43.46 per litre to Rs. 43.75 per litre. The price of ethanol derived from B-heavy molasses will be increased from Rs. 52.43 per litre to Rs. 54.27 per litre. The price of ethanol derived from sugarcane juice, sugar, and sugar syrup has been set at Rs. 59.48 per litre. Goods and Services Tax and transportation tax associated with the ethanol supply is also to be paid by the Oil Marketing Companies and are advised to continue according to priority order of ethanol derived from: (i) Sugarcane Juice/Suger/Sugar Syrup, (ii) B heavy Molasses, (iii) C Heavy Molasses (iv) Damaged Food grains/other sources.
ABOUT ETHANOL BLENDED PROGRAMME (EBP)
The Ethanol Blending Programme (EBP) tends to achieve blending of Ethanol with motor sprit with a view to reduce pollution, conserve foreign exchange and increase the value addition in sugar industry, hence, enabling them to clear cane price arrears of farmers. Under the EBP, the Central Government has scaled up blending targets from 5% to 10%. The procedure of procurement of ethanol under the EBP has also been simplified in order to ease the entire ethanol supply chain. This programme has been extended to the whole of India except UTs of Andaman Nicobar and Lakshadweep Islands w.e.f. 1st April 2019.
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