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Assam government approves ethanol production promotion policy. Here are the benefits

The State Cabinet has approved the Assam Ethanol Production Promotion Policy 2021, said Assam industry and commerce minister Chandra Mohan Patowary. While addressing a press conference in a city hotel, minister Patowary said: “The State Cabinet has approved the Assam Ethanol Production Promotion Policy 2021 ”

Patowary said, “The policy shall be valid up to March 31, 2026.” Assam is the second state in India to bring out an ethanol policy and is among the pioneers in the line, he said.

He said the Union ministry of petroleum and natural gas formulated the National Policy on Biofuels 2018 with an aim to increase the usage of biofuel in the energy and transformation sector. Talking about the objectives of the policy, Patowary said: “The objectives of the policy comprise incentivization of production of ethanol from all feedstocks permitted under NEP 2018.”

The policy will offer fiscal benefits and provide an enabling environment for the promotion and investment in fuel-grade standalone green-field ethanol manufacturing units by facilitating and financially incentivizing potential investors.

The other objectives of the policy are to increase in income of farmers producing feed-stock/raw materials for use in ethanol manufacturing and creation of local employment opportunities through promotion of the new ethanol units. Minister Patowary said the standalone green-field ethanol producing industrial units will be provided incentives under the policy.

Capital subsidy will be provided at 20% of the cost of plant and machinery with maximum Rs 5 crore in addition to the 30% capital subsidy under the provision of CCIIAC under NEIDS 2017.

Power subsidy will be provided at Rs 1 per unit in addition to Rs 2 per unit under the Industrial and Investment Policy of Assam 2019 for a period of 5 years from the date of production, subject to a maximum of Rs 75 lakh per year.

Five per cent interest subsidy will be provided on working capital loan for 5 years, subjec to an overall ceiling of Rs 50 lakh per year in addition to the 2% interest subsidy offered under the Industrial and Investment Policy of Assam 2019 and 3% interest subsidy under NEIDS 2017.

Under the policy, 100% State GST reimbursement will be provided for a period of 5 years, upper limit being 250% of fixed capital investment in addition to reimbursement of the central share of the CGST, IGST and Income Tax offered under NEIDS 2017 for a period of 5 years, minister Patowary informed.

Under the policy, there will be 100% exemption of land conversion of land to industrial class. There will be employment incentive in the form of reimbursement of expenditure on account of provident fund contribution of permanent resident employees for 5 years. There will be skill development subsidy of Rs 20,000 per employee or ASDM rates, whichever is lower, the incentive being applicable only for training of permanent resident employees.

Besides, dovetailing with the Industrial and Investment Policy of Assam, 2019 and NEIDS 2017 shall be allowed under the policy, minister Patowary said.

Informing about the eligibility for type of units, Patowary said only green-field standalone 100% fuel-grade enthanol producing industries which supply 100% of their produced ethanol to oil manufacturing companies under the blending with petrol and diesel shall be eligible for the incentives under this policy.

The industries & commerce department of the Assam government shall be the nodal department and it will be responsible for the implementation of this policy, Patoway said.


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