Energy Foundation China (Energy Foundation) published a study entitled "the world's major national bio-liquid fuel industry policy" research report, the report pointed out that India's development of bio-fuels is the main purpose is to reduce dependence on oil imports, the Government through tax, Biofuel development.
As India's sugar industry is more developed, the initial production of ethanol mainly after processing of sugar by-product of molasses as raw materials. In September 2002, the Federal Government issued a "Alcohol Mixed Program Notice" to enforce the 5% Ethanol Blending Program (EBP) in nine states and four central municipalities producing sugarcane, effective in January 2003. In support of the ethanol mix program, the government adopted a tax rebate policy, and the government's tax rebate policy for ethanol gasoline blends of 2002 to 2003 increased the price of ethanol to $ 0.30 per liter in a few months. But in the same year that ethanol came into effect, the 5% ethanol mix could not be achieved because of the drought caused by reduced sugar production and could not meet the ethanol production needs. In 2004 the government canceled the plan by administrative order. After 2005, sugar cane production began to recover, ethanol production increased significantly (Liu Heqing, 2009). In 2006, the Indian government re-implemented the second phase of the 5% ethanol mix in 20 states and six central jurisdictions, which came into effect in November 2006. In order to ensure the smooth implementation of the second phase of the plan, a new government expert committee was established in 2006 to develop the overall energy policy and all aspects of the energy (Wei Wei et al., 2012). In 2007, due to the lack of molasses, in order to change the lack of supply of ethanol raw materials, at the suggestion of the Commission, the Government allowed the direct use of sugar cane instead of molasses to produce ethanol, ethanol mixing program to continue. After that, the government further raised the mix of ethanol in petrol and increased the ethanol mix from 5% to 10% by October 2008 (G Basavaraj). But has not published official notice, the oil sales company has never started 10% mixed ethanol production.
After that, India has also adopted a variety of policies to promote the implementation of the hybrid program. Up to now, India is still performing a 5% mix. Procedural barriers such as non-issuance of export licenses for ethanol interstate flights, delayed issuance of non-objection certificates and higher taxes and levies increased in different states hindered the ethanol mix. Rules and regulations, including high consumption tax, interbank charges, and alcohol control for the beverage industry, are also applicable to ethanol for mixed gasoline, which severely limits the availability and utilization of ethanol blends.
In addition, the Indian government through taxation, price and other means to promote biofuel development. First, the government "to cancel the biodiesel tax and tariffs, unified biodiesel, bioethanol tax (central sales tax or value-added tax)"; to confirm the biodiesel and bio-ethanol commodity status, "the biological ethanol and biodiesel as a declaration of goods, Its nationwide unrestricted circulation. " Second, the minimum support prices for biodiesel seeds and the minimum purchase price for biodiesel are set to ensure that biofuel crop growers and biofuel processors and sellers receive benefits. "Oil companies to buy bio-ethanol minimum purchase price based on the actual production costs of bio-ethanol and import prices; biodiesel minimum purchase price and diesel retail price linked." If the price of diesel is lower than the price of biodiesel, the government will compensate the oil sales company. Once again, in order to protect their biofuels, India "prohibits the import of free fatty acids, prohibits the provision of import tax rebates and promotes the promotion of local non-edible oil seeds". Finally, the government through the sugar cane development fund for the sugar factory to buy ethanol production equipment to provide subsidy loans, the maximum savings of 40% of the cost.
In order to expand domestic ethanol supply, the Indian public and private sector can promote alternative crops such as sweet sorghum, sugar beet and sweet potato to meet domestic ethanol production needs. Efforts to develop low-cost technology to use lignocellulosic raw materials such as agroforestry waste.