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India Inc eyes jatropha farming in a big way

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Our Bureau

New Delhi, Sept. 1

INDIAN corporates seem to be taking a fancy for jatropha farming.

Both public and private sector companies such as Indian Oil Corporation (IOC), IFFCO, ONGC and Emami have approached the Chhattisgarh Government seeking permission for contract farming of this plant, which is a good source of bio-diesel.

Speaking to newspersons, the Chief Minister of Chhattisgarh, Dr Raman Singh, said, "The private sector has shown great interest in jatropha cultivation. Besides the bio-fuel, another bi-product is glycerol used for extracting glycerine. Many cosmetic companies have started demanding this. Also the residual cake could be used for bio-mass power generation."

The State Government is likely to make available about 20 lakh hectares of land for cultivation.

Under the Government scheme, an individual can lease up to 200 hectares of land at a price of Rs 100 per hectare, per year for the first five years. For subsequent years, these rates could be increased.

The Chhattisgarh Government has estimated the cost of production at Rs 20 per litre if the cost of seeds is taken at Rs 5 per kg. "This corresponds to the landed cost of fossil diesel at $45 per barrel. With duty concessions, bio-diesel proves very competitive at $35 a barrel," he added.

Dr Singh said that plantation of jatropha in farm bunds; wasteland and fallow land of the State will generate extra income of about Rs 2,000 crore for the villagers by 2010. "This programme will make the villagers self-sufficient in energy and generate employment in rural areas," he said.

The State Government has already formulated an action plan including the setting up of the Chhattisgarh Bio-Fuel Development Authority, identifying Government-owned waste or fallow land as well as constituting task forces in various districts.

"A target of planting eight crore jatropha saplings in State nurseries has already been met this year. We plan to distribute 16 crore saplings next year," officials said.

The action plan envisages encouraging private sector to invest in contract farming, setting up oil-expeller and transesterification plant for bio-diesel production in Raipur and smaller units to be set up in every district.

Also, bio-diesel based power generation for rural electrification is being planned.

Dr Singh further added that for bio-diesel to take-off, the Government must formulate a specific policy for the sector. "It must also give concessions on duties and taxes to encourage the use of bio-diesel. Currently, in India mixing of bio-diesel is allowed only up to 5 per cent. This must be raised to 20 per cent and in due course, be increased to 100 per cent," the Chief Minister said.

(This article was published in the Business Line print edition dated September 2, 2005)
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