Bihar has become the first state in the country to implement an ethanol promotion policy that would allow investors to directly make ethanol from maize, molasses, broken rice and rotten grains.

The state cabinet gave a go-ahead to the policy on Tuesday. The matter was tabled in Bihar Legislature on Wednesday.
The Central government has already given permission for direct production of ethanol last December in consonance with National Policy of Biofuels, 2018.

An investor would get a 15 per cent government subsidy — a maximum of Rs 5 crore — besides exemption from stamp duty, registration and land conversion fees, electricity duty reimbursement and employment and skill development subsidy as already being given under the state government’s industrial promotion policy.

SC/ST, EBC, women, differently-abled or acid attack survivor investors will be given 15.75 per cent subsidy up to a maximum of Rs 5.25 crore.

Bihar Industry Minister Syed Shahnawaz Hussain told The Indian Express, “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. Plus, it would give boost to sugarcane production. In post-Covid world, the ethanol policy would prove to be a turnaround story of development.”

Hussain said Bihar Chief Minister Nitish Kumar had been seeking the permission to make ethanol directly from maize and sugarcane juice since 2007.

The ethanol policy provides for first-stage clearance of an investment proposal in seven working days. An application for land from Bihar Industrial Area Development Authority (BIADA) would be given in another seven days. A prospective investor can apply till June 30, 2021 for first-stage clearance and by June 30, 2022 for financial clearance.

The state government has received 25 proposals before the ethanol policy was announced.

The state government would allot land to ethanol investors from the 4,200 acre available with BIADA and the industry department.

At present, Bihar has been producing 12,000 crore litre ethanol per year and is the fifth highest ethanol-producing state in the country.