Riding on increasing ethanol production and weeding out of illicit liquor trade, Uttar Pradesh excise revenue has jumped 13% to touch a record level of Rs 41,000 crore in 2022-23.
In financial year 2021-22, the UP excise revenue stood at Rs 36,321 crore. In the current financial year 2023-24, the government is targetting to mop up Rs 45,000 crore in excise kitty.
The UP excise collection has been burgeoning due to a clamp down upon liquor smuggling and illicit trade in addition to rising ethanol output.
UP is the country’s leading sugarcane producer, while ethanol is a sugar byproduct. The state is aggressively promoting ethanol to enrich the agriculture value chain. Since, ethanol is blended with petrol, it helps India save on foreign exchange to that extent.
Even as the central government has mandated 10 percent ethanol blending in fossil fuel, the blending ratio is already on the rise commensurate with the increasing ethanol availability.
Ethanol from UP is supplied to the public sector oil marketing companies (OMCs) for blending both within and outside the state.
At present, there are 85 operational ethanol distilleries in UP. The state annual ethanol capacity pegged at 2.45 billion litres (BL). Between March 2017 and February 2023, UP produced 5.3 BL of ethanol.
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.
Besides, the UP excise department is looking to using 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.