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Indian biodiesel flounders as imports get boost
July 7, 2009 - Cleantech Group best of the web pick
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Advocates of biodiesel in India have been cheered with news that Finance Minister Pranab Mukherjee said yesterday that the 2009-10 budget reduces the customs duty on imports of the fuel from 7.5 percent to 2.5 percent.
The decision is expected to lower prices and increase consumption; however, it could end up hurting the domestic biodiesel industry, according to a report today in Delhi Hardnews.
The lower duty is expected to increase the supply of palm oil-based biodiesel from countries such as Indonesia and Malaysia (see Indonesia, S. Korea partner for seaweed biodiesel). But the current biodiesel market is capped at a 5-percent blend of biodiesel, thanks to a long-standing mandate from the Bureau of Indian Specifications.
So while supply is growing, the demand might not, which could hamper the domestic industry still struggling to get off the ground, industry advocates say. The biodiesel industry is recovering from new rules in the U.S. and Germany that limit the import of palm oil-based biodiesel (see Indian biodiesel producers rethink export-only status).
Industry group Biodiesel Association of India has now asked for the limit to be raised to 20 percent biodiesel in order to create a larger market. That's the standard the Indian government has set for 2017 (see India, EU affirm new biofuels).
While a 20-percent biodiesel blend is considered safe for most engines without modifications, Delhi Hardnews reports that many of India's automakers don't recommend it. Additionally, the government lacks the regulatory framework for blending biodiesel into existing diesel. The permitting process is so complex that many biodiesel producers began exporting biodiesel (see India can't use own biodiesel).
The $200 billion budget also lowers the customs duty from 7.5 percent to 5 percent on permanent magnets, which are used in wind turbines. The budget allocated $30 million to four government institutes researching forests, geology and the ecosystem, and extended tax benefits to non-government environmental organizations.
Source:
Delhi Hardnews
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Comments
We are always aware the
Submitted on July 7th, 2009 by Ashok Raina (not verified)We are always aware the lobbyist and some in the government have always worked together. Such acts of omission and commission are nothing new.
Indian government has done very little, rather discouraged and derailed indigenous Biofuel and biodiesel program in particular.
Since the Indian Oilssed production and Biodiesel Industry is struggeling and strangulated, The import duty cuts on Biodiesel and providing for Excise Exemption for up to 20% Blending is clearly the handy work of the lobbyists in the Financial Ministry on the behest of some biodiesel producers elsewhere, not definitely India.
Time and Again we have seen such acts being unleashed under the carpet which are going to cost the Domestic Oilseed Industry very dearly.
God alone can save India !
Bio Diesel as per EN 14214 CFPP 12, 5 or 0
Submitted on August 27th, 2009 by Unregistered user (not verified)We are working out possibility of importing Bio Diesel B-100 conforming to EN 14214 CFPP as low as 2 Deg C. We can supply quantities from 20 MTs to 2000 MTs Month at USD 650.00 per MT CIF any Indian Port. It is necessary that the import duty on Bio Diesel should be NIL in order to encourage user of Bio Diesel mainly for non-automobile sector.
We shall appreciate your support to our views ans suggestions. Best regards, M.C. Mundra, Director, Navbharat Overseas Pvt Ltd., Kolkata (India)(Direct Con No. 0091(009831114590)
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