Oil minister Dharmendra Pradhan said on Thursday that state-run companies were investing $2 billion in R&D (research and development) on second-generation biofuel refineries, even as transport minister Nitin Gadkari cautioned that a 22% annual growth in the number of automobiles was unsustainable without promoting public transport running on alternative fuels.
Addressing a function to mark World Biofuels Day, Pradhan said the government was working on a biofuel policy as the industry had an investment potential of Rs 1 lakh crore in next one to two years. Ways are being explored to make fuel out of urban and rural waste and cultivate feedstock on barren land for 2G biofuels.
Gadkari said efforts were on to promote public transport based on cheaper and greener biofuels and electricity. He said he would ask the finance minister to reduce GST on bio-diesel from the current 18% to 5%.
The government has brought in regulations for flexi-engines. Nagpur is running 55 buses on 100% bio-ethanol and another 50% on bio-CNG, essentially methane from sewage water. This is in addition to a 200-strong fleet of electric taxis and autos.
The shipping and inland waterways sectors too are gearing up for running ships and barges on methanol. Besides bringing down pollution, biofuels produced indigenously from agricultural waste will help reduce the country’s huge oil import burden and generate employment.