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 Cabinet approves the National Policy on Biofuel


Shri Vilas Muttewar, Minister for New and Renewable Energy said the Cabinet approval to the National Policy on Bio-Fuel will post and direction to the development of bio-fuels in India. The Union Cabinet gave its approval to the National Policy on Biofuel along with setting up of an empowered National Biofuel Coordination Committee, headed by the Prime Minister and a Biofuel Steering Committee headed by Cabinet Secretary. Under the approved policy, the country aims to raise blending of bio fuels with petrol and diesel to 20% by the year 2017.

The National Biofuel Policy was steered by the Ministry of New and Renewable Energy. A proposal on “National Policy on Biofuels & its Implementation” was prepared after wide scale consultations and inter-Ministerial deliberations. The draft Policy was considered by a Group of Ministers (GoM) under the Chairmanship of Shri Sharad Pawar, Minister of Agriculture, Food & Public Distribution. More than seven Ministries and Planning commission had been debating on the bio fuel policy since last two years. The Agricultural Minister had been anchoring the discussions prior to finalization of policy. After considering the suggestions of Planning Commission and other Members, the Group of Ministers recommended the National Biofuel Policy to the Cabinet.

Salient features of the National Biofuel Policy are :

• An indicative target of 20% by 2017 for the blending of biofuels – bio-ethanol and bio-diesel has been proposed.

• Bio-diesel production will be taken up from non-edible oil seeds in waste / degraded / marginal lands.

• The focus would be on indigenous production of bio-diesel feedstock and import of Free Fatty Acid (FFA) based such as oil, palm etc. would not be permitted.

• Bio-diesel plantations on community / Government / forest waste lands would be encouraged while plantation in fertile irrigated lands would not be encouraged.

• Minimum Support Price (MSP) with the provision of periodic revision for bio-diesel oil seeds would be announced to provide fair price to the growers. The details about the MSP mechanism, enshrined in the National Biofuel Policy, would be worked out carefully subsequently and considered by the Bio-fuel Steering Committee.

• Minimum Purchase Price (MPP) for the purchase of bio-ethanol by the Oil Marketing Companies (OMCs) would be based on the actual cost of production and import price of bio-ethanol. In case of bio-diesel, the MPP should be linked to the prevailing retail diesel price.

• The National Biofuel Policy envisages that bio-fuels, namely, bio-diesel and bio-ethanol may be brought under the ambit of “Declared Goods” by the Government to ensure unrestricted movement of bio-fuels within and outside the States.

• It is also stated in the Policy that no taxes and duties should be levied on bio-diesel.

• The National Biofuel Coordination Committee to be chaired by the Prime Minister would have the following Members:

>> Deputy Chairman, Planning Commission

>> Minister of New and Renewable Energy

>> Minister of Rural Development

>> Minister of Agriculture

>> Minister of Environment and Forest

>> Minister of Petroleum and Natural Gas

>> Minister of Science and Technology

>> Secretary, Ministry of New and Renewable Energy would be the Convener.

• The Bio-fuel Steering Committee to be chaired by Cabinet Secretary would have the following members:

>> Secretary, Ministry of Finance

>> Secretary, Ministry of Rural Development, Dept of Land Resources

>> Secretary, Dept. of Agricultural Research & Education

>> Secretary, Ministry of Environment and Forest

>> Secretary, Ministry of Petroleum and Natural Gas

>> Secretary, Deptt. of Science and Technology

>> Secretary, Ministry of Panchayati Raj

>> Secretary, Dept. of Biotechnology

>> Secretary, Planning Commission

>> Secretary, Dept. of Scientific Industrial Research

>> Secretary, Ministry of New and Renewable Energy would be the Member Secretary.

• In regard to research in bio-fuels, a Sub-Committee under the Steering Committee would be constituted led by the Department of Biotechnology, Ministries of Agriculture & Rural Developmen and coordinated by the Ministry of New and Renewable Energy.

• Major thrust to be given to Research, Development & Demonstration with focus on plantations, processing and production technologies including second generation cellulosic biofuels.


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