Ficci suggests 10 yr tax hoilday for Jatropha farming

New Delhi, Aug 6 (UNI) Industry chamber Ficci has made wide-ranging recommendations to boost large-scale corporate Jatropha plantations for the production of bio diesel and reduce India's massive crude import bill.

The chamber's core group, chaired by Bata India and Ficci Agriculture Committee Chairman P M Sinha, in its presentation to the Ministry of Agriculture has suggested that, among other steps, the government should grant a 10-year exemption of excise and customs duties as well as all Central and state levies on bio diesel or Jatropha oil.

India is not self-sufficient in petroleum and has to import about two thirds of its requirement. It produced 32 million tonnes of oil and imported nearly 99 million tonnes, which is nearly 80 per cent of its requirement. The import cost during 2006 was around Rs 17,1702 crore. Hence, the oil import bill has serious consequences on the economy.

The country's known crude oil reserve is estimated to last only for the next two decades. Substitution of bio-fuel for oil will therefore have a positive effect on reducing imports. Displacing oil with bio-fuel apart from having direct consequences upon national economy would have enormous effect on the environment. They would play a crucial role in mitigating the pollution to a greater extent, the chamber said.

The Ficci Core Group feels that if the plantations are brought under the reforestation projects under the Clean Development Mechanisms, there is potential for farmers and low-income communities to gain early returns from the carbon mitigation in tree biomass.

The income from carbon trading would amount to an average of Rs 2,800 per hectare from the fifth year of planting. The income from trading the carbon credits as well from the Jatropha seeds makes this highly remunerative for the wasteland tracks in India.

The other major recommendations made by the group include, single window clearance for setting up plants, removal of upper ceiling of subsidy by National Oilseeds and Vegetable Oils Development Board (NOVOD), which is Rs 6.50 lakh to encourage farmers and corporates, simplifying procedures for availing credit/loans, allottement of wastelands by Letter of Intent to plant the trees along with Lease Agreement and transparency in allocation of wastelands in a time-bound programme from the date of application.

India has about 24 million hectares of land that is classified as cultivable wastelands. Jatropha curcas thrives on any type of soil, can endure long periods of droughts and needs minimal inputs or management.

It has no problems due to insects, pests or browsing by cattle and sheep. Propagation is easy and the yield starts from 3rd year and continues till 30-35 years.

The yields expected from Jatropha plantations would be close to 2.5 tonnes per hectare. Oil content varies from 28 per cent to 38 per cent in Jatropha depending upon the species.

At a price of Rs 5 per kg of seed, even 5.0 ton of seeds per hectare represents Rs 25,000 income for the communities, Ficci said.

UNI CS PV HT1607