Growing opportunities in ethanol production are encouraging investors to enter Karnataka’s sugar industry, with the state Sugar Commissionerate receiving 42 applications to set up new sugar mills, OneIndia, reported.
The increased interest comes as ethanol has become an important source of additional income for sugar mills. Instead of depending only on sugar sales, new and existing mills are looking at ethanol production and other sugarcane-based products to strengthen their business.
The Centre’s ethanol blending programme has opened up a larger market for sugar mills and distilleries. The programme aims to increase the use of ethanol in petrol, reduce India’s dependence on imported crude oil and strengthen energy security. Concerns about possible disruptions in global oil supplies have also increased the focus on domestic fuel alternatives.
For investors, sugar mills with ethanol production facilities offer an opportunity to earn from both sugar and fuel. Sugarcane can be processed for sugar, while molasses and other materials from the crop can be used to produce ethanol.
Of the 42 applications received by the Karnataka Sugar Commissionerate, most are from the Kittur Karnataka and Kalyana Karnataka regions. Belagavi has received the highest number of applications at 13, followed by Vijayapura with eight and Kalaburagi with six. Bagalkot and Dharwad have received four applications each.
The Kittur Karnataka region already has a strong presence in the sugar industry, including several mills associated with politically influential leaders. Some of those seeking approval for new mills are also politically influential.
Karnataka has a large sugarcane cultivation base that can support the expansion of the industry. Sugarcane is grown across around 7.5 lakh hectares in the state, with annual crushing estimated at about 576 lakh metric tonnes. Karnataka produces around 49 lakh metric tonnes of sugar every year.
The state currently has 81 operational sugar mills, including cooperative sector units. Belagavi alone has 29 mills, making it a major centre of sugar production in Karnataka.
If all 42 proposed projects receive approval and become operational, the total number of sugar mills in the state could increase to 123.
The rise in applications points to the growing importance of ethanol in the business plans of sugar industry investors. With the government continuing to promote ethanol blending in petrol, investors are increasingly looking at sugar mills as businesses that can serve both the food and fuel markets.
For Karnataka, the proposed projects could therefore expand sugar production while also increasing the state’s role in India’s growing ethanol and alternative fuel sector.
