The Union cabinet on Wednesday approved the "National Policy on Biofuels - 2018".
According to the policy, surplus food grains can be used to produce ethanol for blending with petrol with the approval of the "National Biofuel Coordination Committee".
As per the policy raw material like sugarcane juice, sugar containing materials like "Sugar Beet, Sweet Sorghum, starch containing materials like Corn, Cassava, damaged food grains like wheat, broken rice, rotten potatoes, which are unfit for human consumption can be used for ethanol production".
"With a thrust on advanced biofuels, the policy indicates a viability gap funding scheme for 2G ethanol bio refineries of Rs 5,000 crore in six years in addition to additional tax incentives, higher purchase price as compared to 1G biofuels," a cabinet statement said.
"The policy encourages setting up of supply chain mechanisms for biodiesel production from non-edible oilseeds, used cooking oil, short gestation crops. Roles and responsibilities of all the concerned ministries or departments with respect to biofuels has been captured in the policy document to synergise efforts."
In terms of benefits, the policy is expected to reduce import dependency of ethanol, boost cleaner environment, municipal solid waste management and infrastructural investment in rural areas among others.
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