Bihar's Industrial Quest: Becomes First Indian State To Implement Policy Permitting Direct Ethanol Production

The Bihar state cabinet led by Chief Minister Nitish Kumar has approved an ethanol promotion policy that will permit investors to directly produce ethanol from molasses, maize, rotten grains and broken rice.

The central government has already given the go-ahead for direct production of ethanol through the National Policy of Biofuels, 2018 and Bihar has become the first state to carry out such a blueprint.

As per the policy, government will roll out subsidy of around 15 per cent (up to Rs 5 crore) to investors and also exempt them from paying registration and land conversion fees and stamp duty.

Electricity duty will be reimbursed to them whereas the investors can also avail the employment and skill development subsidy according to Bihar’s industrial development policy, Indian Express reports.

Moreover, Scheduled Castes (SC), Scheduled Tribes (ST), acid-attack survivor and female investors will be given extended subsidies of around 15.75 per cent up to Rs 5.25 crore.

Investment proposals will obtain the first-stage clearance within seven days as per the new ethanol policy. Thereafter, an application of land from the Bihar Industrial Area Development Authority (BIADA) will be provided in the next one week. 4,200 acres of land currently available with the BIADA and the industry government will be allotted to ethanol investors.

Businessmen have time till 30 June, 2021 and 30 June, 2022 to acquire the first-stage and financial clearances respectively.

Bihar’s newly-appointed Industry Minister and seasoned BJP leader Shahnawaz Hussain revealed that CM Nitish Kumar had been looking for a go-ahead to produce ethanol directly from maize and sugarcane juice right from 2007 onward.

“The ethanol policy would pave the way for making Bihar an ethanol hub and investors’ coveted destination. Investors would now be able to procure maize of farmers from 18 maize-growing districts at a good rate,” the cabinet minister was quoted in the report.

He added that sugarcane production will be boosted through this policy and even implied that the ethanol policy will turn out to be a landmark tale of development in the post-Covid world. The issue was tabled in the state legislate on Wednesday (17 March).

The need for such a strategy was evident from the fact that Bihar’s state government had received 25 proposals prior to the announcement of the ethanol policy.