The Tamil Nadu government has proposed setting up a 100 KLPD (kilolitres per day) ethanol distillery at the Kallakurichi-I Cooperative Sugar Mill as part of its strategy to expand ethanol production and diversify the state’s sugar industry.
Announcing the initiative in the Agriculture Budget for 2026-27, Agriculture and Farmers’ Welfare Minister M.R.K. Panneerselvam Vinoth said the proposed distillery will be established in partnership with the Kallakurichi-II and Chengalrayan cooperative sugar mills, DT Next reported.
The government has allocated Rs 20 lakh to prepare a detailed project report (DPR) and conduct a feasibility study for the project.
Alongside the ethanol initiative, the state announced measures to strengthen sugarcane production to ensure a sustainable supply of feedstock for the sugar and biofuel industries.
A new Seed Cane Subsidy Scheme will provide a 50% subsidy on planting material for farmers registered with cooperative and public sector sugar mills who adopt wider row planting using bud chip seedlings and single-budded setts of high-yielding, high sugar recovery varieties. The government has earmarked Rs 9.36 crore for the scheme, which will cover 17,315 acres during 2026-27.
The state also launched a Sugarcane Cultivation Development Programme with an outlay of Rs 9 crore to promote breeder seed cane, tissue culture seedlings, de-trashing, trash shredding, mulching, micronutrients and bio-fertilisers to improve cane productivity and reduce cultivation costs.
The initiatives are aimed at strengthening the sugarcane value chain while supporting ethanol production through improved feedstock availability and new processing infrastructure.
