New Delhi: Industry body ASSOCHAM has urged the government to evolve a policy for encouraging second-generation alternative fuels like cellulosic ethanol and set targets for blending with gasoline to reduce dependence on oil imports.
India produces 91.7 million gallons of ethanol in a year using sugarcane as feedstock with only half a per cent share in global ethanol production. The United States produces 10,600 million gallons using corn as feedstock and has over 53 per cent share in global ethanol production.
Brazil produces 6,578 million gallons of ethanol using sugarcane as feedstock while the European Union uses grains and sugar beet to produce 1,040 million gallons of ethanol in a year.
“India can learn from experiences of other countries to boost its ethanol production and cut the high oil imports bill,” said Mr D.S. Rawat, secretary general of The Associated Chambers of Commerce and Industry of India (ASSOCHAM).
Brazil began its ethanol programme during the first oil shock and has been successful in ensuring energy security and saving foreign exchange of 60.7 billion dollars during 1976-2004 by substituting oil imports through ethanol production.
India too can adopt similar practices by setting up processing plants, designing cars suitable for ethanol fuel and levying taxes on gasoline to maintain parity in mileage costs of these fuels, said Mr Rawat.
Being one of the fastest growing economies in the world, India’s demand for fuel is rising by five per cent per year. It imports nearly 70 per cent of its crude oil requirements, putting a huge burden on foreign exchange reserves.
However, the areas under sugarcane cultivation and yield have stagnated in recent years. The country cannot grow sugarcane exclusively for ethanol production as there is not enough irrigated land for it.
The government should allow sugarcane juice and other available alternate feedstock like sweet sorghum, sugar beet and cellulosic raw materials, said Mr Rawat. At the same time, efforts should be made for collaborative research with countries like Canada which have made substantial advances in cellulosic technology.