Ban on sugar for ethanol: Centre files caveats in High Courts of Bombay and Karnataka fearing stay order
High Courts of Bombay and Karnataka, seeking to be heard before the courts pass any stay order on the restrictions imposed on usage of sugar for ethanol production, an official told ET.
Several sugar firms have approached various courts seeking a stay on the Centre's December 7 order prohibiting mills from producing ethanol from sugarcane juice in the 2023-24 season.
In the absence of a caveat, the courts can pass a stay order without hearing the government, explained the official cited above.
The Centre issued the ban to keep a check on rising sugar prices in the domestic market despite restrictions on exports due to lower sugarcane yield in main producer states of Maharashtra and Karnataka. Sugar prices had touched ₹40 in northern India by the end of sugar season 2022-23 (October-September).
The government later allowed diversion of 1.7 million tonnes of sugar for ethanol production in the 2023-24 marketing year that started on October 1, 2023, to allay industry concerns.
Industry body Indian Sugar Mills Association (ISMA), which has now renamed itself as Indian Sugar and Bio-energy Manufacturers Association, had said the «sudden ban» on the use of cane juice for ethanol would have an adverse impact on capacity utilisation of mills, putting at «risk» their ₹15,000-crore investment in the last three years to set up plants for green fuel.
In July, the Food Corporation of India (FCI) had stopped supplying rice for ethanol production to distilleries, leaving distilleries with fewer options for raw materials for ethanol production.
Under the Ethanol Blending Programme, India wants to achieve 20% blending of petrol with ethanol by 2025, producing ethanol with sugar as well as grains.
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