The Indian Sugar and Bio-energy Manufacturers Association (ISMA) has urged the government to rationalise GST on flex-fuel vehicles and higher ethanol blends in the upcoming Union Budget, saying the move would support clean mobility while helping stabilise the ethanol ecosystem.
The Director General of ISMA, said GST on flex-fuel and strong hybrid vehicles should be reduced to 5 per cent, in line with electric vehicles, from the current rate of around 18 per cent.
“For a clean technology like EVs, the GST is 5 per cent. There is no reason why the same rate cannot be extended to flex-fuel and strong hybrid vehicles, which are also clean technologies,” he told ANI in an interview.
He also called for a reduction in the GST on higher-ethanol-blended fuels such as E85 and E100. He said bringing GST down to 5 per cent from 18 per cent would make these fuels cheaper than conventional petrol and boost consumer adoption.
Sugar prices in India
On sugar exports, he said India was permitted to export 15 lakh tonnes of sugar in November, though shipments have been slow due to weak international prices. He said export realisations were currently around $446–448 per tonne FOB, compared with London white sugar prices of about $426 per tonne.
“There is no parity in sugar prices as Indian prices are higher than global prices at present,” he said, adding that exports are expected to pick up from January as Brazilian sugar supplies ease.
He said around 1.5–2 lakh tonnes of sugar have been contracted so far, with 50,000–60,000 tonnes already exported.
On the domestic front, he said India began the season with opening stocks of about 50 lakh tonnes, and sugar production is progressing well. Total output for the season is estimated at around 345 lakh tonnes, while domestic consumption is projected at 284–285 lakh tonnes.
Even after accounting for ethanol diversion and exports, he said closing stocks are expected to remain high at around 59–60 lakh tonnes, putting pressure on domestic prices.
He also flagged challenges for the ethanol sector after achieving the E20 blending target, citing limited consumption beyond 20 per cent and low allocation to distilleries, which have impacted viability in several states.
Source from: https://auto.economictimes.indiatimes.com/news/oil-and-lubes/isma-demands-gst-reduction-for-flex-fuel-vehicles-and-ethanol-in-upcoming-union-budget/126303134
