ISMA would also request the Government to extend all benefits and incentives proposed to be given to the sectors who contribute towards improving air quality and increasing renewable energy production in the country, to the Indian sugar industry / distilleries which produce and supply ethanol for blending with petrol.
In the Union Budget 2021, the import duty on denatured ethyl alcohol is proposed to be increased from 2.5% to 5%, making imports of the same costlier by around Re.1 per litre at the current global prices of denatured ethanol. This in turn will increase the demand for domestic molasses and alcohol produced by the Indian sugar industry and grain based distilleries, giving better returns which in turn will ensure better payments to the Indian sugarcane and grain farmers. This is another step of the Government of India towards Atmanirbhar Bharat.
The budget also talks of encouraging renewable energy, clean air as well as emphasizes a lot on encouraging Indian agriculture. This will give further boost to the ethanol production from sugarcane and surplus grains/ maize, because ethanol blended petrol reduces vehicular pollution and directly improves air quality. Ethanol is a renewable bio-fuel produced from agricultural crops, and hence would directly benefit the Indian farmers.
The sugar industry is very happy to note the allocation in the budget estimates for 2021-22 FY of Rs.4337 crore for the sugar industry. At the same time, the revised estimates of 2020-21 FY, which now increases the budgetary allocation by Rs. 5376 crore, as compared to the BE, is another very positive decision being taken by the Government. The proposed BE for 2021-22 for the sugar industry is Rs. 2895 crore higher as compared to the BE of 2020-21. Almost all these payments are to be made to the sugarcane farmers and therefore will directly reduce the cane price arrears and benefit the farmer community directly.
The provision of Rs.150 crore in the RE 2020-21 and another Rs.300 crore in BE 2021-22 for extending financial assistance to sugar mills for enhancement and augmentation of ethanol production capacity will give further boost to setting up of more ethanol factories in the country, which in turn will help reduce the surplus sugar and also increase ethanol supplies for ethanol blending with petrol, thereby reducing the net oil import bill of the country and improving air quality.
Overall, the Indian sugar industry welcomes the various steps taken by the Government to financially help the industry and the sugarcane farmers. ISMA would also request the Government to extend all benefits and incentives proposed to be given to the sectors who contribute towards improving air quality and increasing renewable energy production in the country, to the Indian sugar industry / distilleries which produce and supply ethanol for blending with petrol.