The national biofuel policy announced by the government last week is well-intentioned but is not really practical. It aims for achieving a 20 per cent blending of biofuels with petrol as well as diesel by 2017. Given that even the 5 per cent ethanol doping target — raised to 10 per cent last October — is yet to be achieved makes the target quite unachievable. The sugar industry, which is the major producer of ethanol (from its by-product molasses), and the oil marketing companies continue to wrangle over the pricing of ethanol. Thanks to government intervention, they had entered into a three-year contract (which expired on October 31) for the supply of ethanol at Rs 21.50 a litre, but many sugar mills defaulted, preferring to sell the ethanol to potable liquor manufacturers and others who were willing to pay higher prices. Even if you ignore the default, a doping programme based on ethanol is not a stable once since it depends on the production of sugar which declines and rises in a cyclic pattern.
In the case of biodiesel, the new policy moots its production from non-edible oilseed plantations on waste, degraded and marginal lands and fixing of minimum purchase prices for it as is done for many crops. Though this seems a well-conceived idea as it stays clear of competing with food crops for land, it requires land which is not so easy to get. The Ministry of New and Renewable Energy, which has to implement this policy, does not have any land under its control and will depend on others to make it available for raising energy plantations. Most of the degraded lands are either forest lands, which are virtually out of bounds for others, or village common lands belonging to panchayats and communities and used by the landless and tribals for cattle grazing and other purposes. As for the non-edible oilseeds available from the wildly growing oilseed-bearing trees, such as Neem (Azadirachta indica), Karanj (Pongamia pinatta), Mahua (Madhuca indica), Sal (Shorea robusta) and the like, it will be a formidable challenge to collect these in large enough quantities to run commercial processing units. Jatropha, one of the few oil-bearing trees that can be grown in captive plantations, has not been studied enough and not enough is known of what problems its large-scale cultivation may throw up. Not much is known about its agronomic requirements and survivability under different agro-climatic conditions. The wild gyrations in petroleum prices will also affect the viability of jatropha-based commercial-scale biofuel ventures. The real danger, of course, is that if jatropha clicks as a viable biofuel, it could encroach upon agricultural lands the way eucalyptus did when it became the preferred plantation for absentee landowners. It would, therefore, be better to promote biofuel production from bio-wastes and by-products of agriculture and agro-based industries. The land-based route to biofuel production, which many land-surplus countries like Brazil follow, is unsuitable for land-starved India.