Cabinet approves hike in ethanol prices

The Cabinet Committee on Economic Affairs on Wednesday approved an increase in ethanol prices from Rs 39 per litre to Rs 40.85 per litre for supply to public sector oil companies.

The revised prices of ethanol will be applicable for the forthcoming sugar season 2017-18. GST and transportation charges will be payable additionally.

"The approval will facilitate the continued policy of the government in providing price stability and remunerative prices for ethanol suppliers. It will also help in reducing dependency on crude oil imports, saving in foreign exchange and benefits to the environment," an official statement said after the Cabinet meeting.

In order to augment the supply of ethanol, the government in December 2014 had decided to administer the price of ethanol under Ethanol Blended Petrol (EBP) programme.

The CCEA headed by Prime Minister Narendra Modi also gave an ex-post facto approval for a Special Banking Arrangement (SBA) for payment of outstanding subsidy to fertilizer companies during 2016-2017.

Under the SBA, a total loan of Rs 9,969 crore for settlement of outstanding subsidy bills with SBI was raised by the government. The loan amount along with interest liability on the part of government amounting to Rs 80.90 crore was paid to SBI, the statement said.

The Cabinet also gave an ex-post facto approval for a trade agreement between India and Ethiopia for strengthening and promoting trade and economic cooperation. The Cabinet also approved an agreement between India and Armenia on cooperation and mutual assistance in customs matters.