Bihar on Wednesday became the first state in the country to have its own ethanol policy, called Ethanol Production Promotion Policy, 2021, which has been approved by the Cabinet.
The new policy would permit ethanol production in Bihar from all feed stocks permitted by National Policy on Biofuels, 2018, and subsequently by National Biofuel Co-ordination Committee.
The Assembly was informed of the cabinet decision by deputy chief minister Renu Devi as the industry minister Shahnawaz Husain was away in poll-bound West Bengal for campaigning. “Bihar has become the first state to bring a special policy for ethanol production,” said the deputy CM.
In December 2020, the Cabinet Committee on Economic Affairs (CCEA) had approved a modified scheme for extending interest subvention for those setting up grain-based along with molasses-based ethanol distilleries.
So far, the government of India has granted permission for ethanol production from B-heavy molasses, C-heavy molasses, grains unfit for human consumption, sugarcane juice, sugar, sugar syrup, surplus rice and maize.
The Ethanol Production Promotion Policy, 2021, of Bihar promotes new standalone ethanol manufacturing units by providing them additional capital subsidy at 15% of cost of plant and machinery up to a maximum of ₹5 crore. This capital subsidy will be in addition to existing incentives under Bihar Industrial Investment Promotion Policy, 2016. Under the industrial policy, units are offered exemption from stamp duty and registration fees, exemption from land conversion fees, interest subvention incentive, SGST reimbursement and electricity duty reimbursement, employment subsidy and skill development subsidy.
The new policy also provides additional subsidy for special class investors like SCs, STs, EBCs, women, differently-abled, war widows, acid attack victims and third gender entrepreneurs. In their case, the capital subsidy will be 15.75% of cost of plant and machinery up to a maximum of Rs. 5.25 crore.
Dovetailing of capital subsidy with incentives under any Central government policy has been allowed. So, investors may avail capital subsidy under the policy even if they are availing incentive under any Central government policy.
The policy lays significant emphasis on issuing licences and clearances in a timebound manner for new standalone ethanol units.
“Stage-1 clearance will be issued to units in seven working days; application for BIADA land allotment will be disposed of in seven working days and department of industries will hand-hold investors/entrepreneurs in private land registration and land conversion and also in availing all licences/clearances and NOCs required for setting up unit,” industry minister Shahnawaz Husain said over phone.
The industry department has also fixed timelines for applying under the scheme. “The willing investors will have to apply for stage-1 clearance latest by June 30 this year and then apply for financial clearance latest by June 30 next year,” the minister said.