India pushes to allow ethanol imports

India’s Petroleum Ministry is pushing for allowing the importation of ethanol for blending with petrol, reversing the earlier policy of relying on local production. “Imports may be allowed in the consumer interest to ensure that sufficient quantities are procured at economic rates, and prices of petrol and diesel do not become captive to domestic price spikes in respect of ethanol and biodiesel,” the Petroleum Ministry said in a Cabinet note. The main issue of contention is the price. Ethanol suppliers now are asking for Rs26-27 (US$0.60-0.63) per liter of ethanol, while oil companies are pushing for an all-India reference price of Rs 21.50 (US$0.50/liter). The sugar industry says at 5% blending, the country would require 682 million liters of ethanol in 2006-07, and the demand could rise to 1.3 billion liters with 10% blending. (March 22, 2007)