The sugar industry has been assured that their demand to bring ethanol distilleries under the priority sector lending category will be supported by the Ministry for Petroleum and Natural Gas.

“I will take up this matter with the Finance Ministry. For building capacity to manufacture more ethanol, this is a step that is required,” Dharmendra Pradhan, Minister of State (Independent Charge) for Petroleum and Natural Gas, said here on Friday. He was addressing a workshop on ethanol-blended petrol, organised by the Indian Sugar Mills Association (ISMA) and was apprised of the issues being faced by the industry to ramp up ethanol production.

Beyond 10% target

“We need more distilleries to go beyond 10 per cent blending. Right now the ethanol production capacity is 224 crore litres but the requirement for 10 per cent blending will be 266 crore litre,” Tarun Sawhney, President, ISMA, said.

He said, the production in the current year will reach 120 crore litres and will enable 5 per cent ethanol blending for petrol, adding that storage capacity for ethanol at refinery gates was a concern for raising production.

Pradhan said the Ministry had started planning to resolve such concerns, adding “We are planning to have separate storage capacity for ethanol at the public sector refineries.”

Meanwhile, the Minister urged the industry to develop a payment mechanism wherein dues to farmers could be transferred directly to their bank accounts.