An Indian ministerial panel led by Minister of Agriculture Sharad Pawar will address issues relating to bioethanol pricing and blending, the Press Trust of India reported Monday quoting a senior government official.
"The GoM [Group of Ministers] is authorized to examine all matters relating to pricing of bioethanol, its blending with petrol and any other relevant issues, and make its recommendations for formulating a suitable policy on the subject," he said.
The group includes Finance Minister P. Chidambaram, New and Renewable Energy Minister Farooq Abdullah, and Petroleum and Natural Gas Minister S. Jaipal Reddy, Chemicals and Fertilizers Minister M.K. Alagiri and Planning Commission Deputy Chairman Montek Singh Ahluwalia.
The Cabinet Committee on Economic Affairs had last month referred the proposal on hiking bioethanol price to the panel.
Another panel headed by Planning Commission member Soumitra Choudhary had recommended that bioethanol be priced in the range of Rs 23-31 ($0.41-0.56)/liter, but the Prime Minister's Economic Advisory Council suggested that market forces should be allowed to determine the price.
The government has currently fixed the provisional price of bioethanol at Rs 27/liter. This is the rate at which oil marketing companies buy bioethanol from sugar mills in order to fulfill the mandatory 5% blending with gasoline.
Bioethanol is produced from molasses, a byproduct of sugar production from sugarcane.
