Ethanol blending order sweetener for sugar cos
Once the Cabinet decision to ensure that the entire country complies with the policy of blending petrol with ethanol in a 95:5 ratio, ethanol producers — mostly sugar firms — may rake in around R1,500 crore more, or an additional 20%, from ethanol sales. This, analysts say, would help improve the bottom lines of sugar firms, which have piled up huge amounts of debt in the last four years as myriad state controls made their business a loss-making one.
“The move would make the sugar industry more viable and would open another avenue of income for it which can be shared with the farmers,” said National Federation Of Cooperative Sugar Factories MD Vinay Kumar.
The Cabinet decision on ethanol-blending of petrol comes close on the heels of a series of good news for the debt-ridden industry in recent weeks. Sugar prices have crept up by more than 15% since June after remaining subdued for around a year, and a panel – headed by C Rangarajan, chairman of the Prime Minister's Economic Advisory Council – has suggested deregulation of the sector. In a first, the government is constituting an inter-ministerial panel to consider implementing at least some of the suggestions of the panel where the states' role isn't required, including freedom to mills from supplying subsidised
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