Govt imposes 50 pc export duty on molasses to boost supply for ethanol production

The government has imposed 50 per cent export duty on molasses, a by-product of sugarcane and key ingredient for ethanol production, amid likely decline in sugar production in the current season.

According to a finance ministry notification, the order will come into force from January 18.

The move is aimed at boosting the availability of molasses for domestic distilleries and help meet the government's ethanol blending target.

In the current year, the government aims to achieve 15 per cent blending of ethanol with petrol for which 690 litres of ethanol would be required.

Without diversion for ethanol, the government has estimated sugar production to decline to 32.3-33 million tonne in the ongoing 2023-24 season (October-September) as against 37.3 million tonne in the previous season.

India exports molasses to countries including Vietnam, South Korea, the Netherlands and the Philippines. Maharashtra, Karnataka and Gujarat are the three states which export molasses.