Tamil Nadu mills want government to lift ethanol production cap and cut VAT

In India, sugar mills in Tamil Nadu are calling on the government to ease the ethanol production cap currently in place so they can improve their overall sugarcane economics. With ethanol production limited to just 500,000 liters, mills can supply that volume in about 10 days, but just producing sugar has them running at a continuous economic loss. In addition, a 14.5% statewide VAT on ethanol makes the fuel uncompetitive compared to what is brought in from other states, a situation that needs to change in order to boost ethanol production for the blending mandate.