Ban on sugarcane juice for ethanol production: Ajit Pawar says Amit Shah has assured of solution in two days

File Photo

Maharashtra Deputy Chief Minister Ajit Pawar said on Friday that Union Cooperation Minister Amit Shah has pledged to address the challenges arising from the abrupt decision by the Centre to prohibit the use of 'sugarcane juice and sugar syrup' for ethanol production.

Pawar, who also serves as the Finance Minister, assured the state assembly that Shah has committed to finding a solution within the next two days.

The Centre's decision, announced on Thursday, banned the utilization of 'sugarcane juice and sugar syrup' for ethanol production during the 2023-24 supply year, which commenced this month.

This move aims to ensure an adequate supply of sugar for domestic consumption and stabilize prices. However, the government has permitted the use of 'B-molasses,' a by-product of sugarcane, for ethanol production in the same period.

Also read: Amendment bill to bring betting, gaming in 28 pc GST bracket tabled in Maharashtra assembly

Addressing the legislative assembly, Pawar characterized the Centre's decision as "sudden" and underscored the significant investments made by numerous sugar mills in Maharashtra, a leading producer of sugar in India, to establish ethanol plants.

"The ban on ethanol production from sugarcane syrup was sudden. Many sugar mills have invested in ethanol plants with 5 per cent of their capital and 95 per cent funds borrowed from outside," Pawar stated in response to concerns raised by Congress and NCP legislators in the house.

Opposition leaders voiced apprehensions that the Centre's decision would adversely impact sugar mills in Maharashtra, which have secured loans to establish units for producing ethanol from sugarcane syrup and molasses.

Pawar informed the assembly about his discussions with Chief Minister Eknath Shinde, Deputy Chief Minister Devendra Fadnavis, and state Cooperation Minister Dilip Walse-Patil on the issue. Additionally, he communicated that he spoke to Union Home (and Cooperation) Minister Amit Shah, who assured him of a resolution within the next two days.

"If a solution is not found, we will visit New Delhi and discuss the issue with him (Shah). I have also taken up the matter with Union Commerce Minister Piyush Goyal," Pawar emphasized.

In a letter addressed to all sugar mills and distillers, the Food Ministry instructed them "not to use sugarcane juice/sugar syrup" for ethanol production during the 2023-24 ethanol supply year (December-November). The ministry clarified that the supply of ethanol from existing offers received by Oil Marketing Companies (OMCs) from B-Heavy molasses would continue.

The central ministry's decision comes against the backdrop of an anticipated decline in sugar production during the 2023-24 marketing year (October-September). The move aligns with the government's broader initiative to reduce dependence on crude oil imports by blending ethanol, a colorless liquid, with fuel. (With inputs from PTI)