Indian biodiesel policy imminent; B5 mandate, 1.3 billion gallon market expected as ministers convene

January 29, 2008

In India, Agriculture Minister Sharad Pawar will convene a Group of Ministers meeting aimed at making a decision on India’s biodiesel policy. Observers expect that a Biodiesel Board will be established to coordinate policy and provide stability for the market. In addition, the meeting is expected to produce a target of as much as 1.3 billion gallons of biodiesel per year. The Biodiesel Association of India has proposed a B5 mandate, a price reduction from the current $2.54 level, and a 30 percent subsidy on jatropha cultivation.

Until now, although India has been a leader in jatropha-based research, most Indian biofuels activity has been on the ethanol side, although D1 Williamson Magor Biofuels announced that it would invest $89 million in jatropha plantations and a biodiesel plant, with an eventual ambition of a 55,000 hectare jatropha plantation in eastern India.

In part, the culprit for limited biodiesel activity is high prices. Late last year, a 100-bus trial of B20 in Pune was canceled after the lowest bid for B20 was $4.12 per gallon, compared to $3.36 per gallon for diesel.

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Written by Jim Lane · Filed Under International, Policy