Aiming to enrich the sugarcane value chain and boost ethanol production, the Uttar Pradesh government is targetting excise revenue of Rs 45,000 crore in the next financial year 2023-24.
Compared to the goal of Rs 40,000 crore for the current financial year 2022-23, the excise revenue target of Rs 45,000 crore for the next fiscal is 12.5 percent higher.
According to UP additional chief secretary (excise) Sanjay R Bhoosreddy, the new UP excise policy, announced recently, will boost the farm income. “The increase in ethanol production for blending in fuel will also help the government in saving foreign exchange.”
The policy looks at regulating the activities relating to manufacturing, transport, import, export, sale and possession of intoxicants. It seeks to fulfill the objective of increasing the financial resources and making quality liquor available to consumers at a reasonable price.
He said the new policy will attract large-scale investors in the ethanol sector, thereby boosting the farm income, providing a ready market for farm produce and generating local employment.
UP is India’s top sugarcane producing state, while ethanol is a sugar byproduct. In the current crushing season 2022-23, cane acreage was estimated at over 2.93 million hectares (MH).
The excise department is working on using the molasses obtained as a sugar byproduct to produce alcohol, which could then be used to manufacture different types of chemicals, ethanol-blended petrol, sanitisers and liquor.
“This will promote industrialisation and develop the agricultural sector, benefiting the farmers,” a state government spokesperson noted.
The central government has mandated the blending of 10 percent ethanol to fuel. Under this policy, ethanol produced in UP is exported to the petroleum depots within and outside the state for blending.
In 2021-22, about 965.5 million litres (ML) of ethanol was extracted, of which 439.5 ML and 526 ML was supplied to the oil depots of UP and other states respectively.
In the current financial year up to Nov 2022, about 875.7 ML of ethanol was extracted, of which 435.5 ML and 440 ML was supplied to the oil depots of UP and other states respectively.
Till Nov 2022, there was a spurt of 13 percent in alcohol production as compared to the corresponding period last year even as the state is working towards keeping the consumption of alcohol within ‘responsible’ and ‘safe limits’. The state has hiked the license fee for retail outlets.