Private firms queue to invest in India biodiesel

By Biman Mukherji

NEW DELHI (Reuters) - Private firms are lining up millions of dollars of investments in India for biodiesel production from the jatropha plant, with a new biofuels policy likely soon, a top industry official said on Tuesday.

Sandeep Chaturvedi, president of the Biodiesel Association of India, told Reuters that about 20 billion to 25 billion rupees ($452-565 million) were known to have been invested, with actual investment probably much more.

However, he said this just scratched the surface of the 285 billion rupees needed over the next five years if India was to achieve its target of replacing 5 percent of diesel with biodiesel from jatropha.

He said commercial sales would only start in two to three years as it would take that much time for the jatropha plants to become oil bearing.

"India has all the requisite credentials for going into biodiesel in a big way," he said. "But we would like to achieve this in a gradual fashion, rather than try for a target which is not achievable."

He said that a multinational oil company has committed $20 million for research for biofuels production in India, while one of India's top industrial houses had begun a trial of jatropha cultivation on 300 hectares of land.

Another multinational firm has entered into contract farming for jatropha cultivation in the country.

He added that a draft biofuels policy was in place and more inputs were being given under the direction of India's policy think tank, the Planning Commission.  Continued...