The growing ambitions of Indian companies in the biofuels business are beginning to spill out of the country, to Malaysia, Africa, even South America.
Construction firm Shapoorji Pallonji & Co. Ltd, headquartered in Mumbai, is looking for land in South America and Africa for biofuel projects.
Hyderabad-based Nandan Biomatrix Ltd and Mysore-based Labland Biotech Pvt. Ltd are prospecting for land to grow jatropha in Malaysia. And Labland is partnering a Portuguese firm in a jatropha cultivation project in the African country of Mozambique.
The interest of these firms in biofuels, especially jatropha, a non-edible tropical weed that is a rich source of biodiesel, comes at a time when countries around the world are beginning to look at biofuels as a way to reduce their dependance on fossil fuels.
“We are looking to get the land to build biorefineries and also be involved in all processes till trans-esterification (the chemical process by which vegetable oil is converted into biodiesel),” said a senior official of Shapoorji Pallonji who did not wish to be identified.
Given the demand for land and recent controversies surrounding its acquisition for industrial purposes in India, companies could find it easier to get land for their projects overseas.
Jaya Kumar B., technical director at Nandan Biomatrix, recently made a presentation to the Federal Land Development Authority, the government land coordinating agency in Malaysia, to acquire land for jatropha cultivation in Sabah, a state in that country.
“We need about a million ha (10,000 sq. km), but for that we need to partner with a local company. Talks are at an advanced level with a Sabah-based company,” said Kumar.
Sudheer Shetty, managing director of Labland Biotech, said the government of Sarawak (the largest state in Malaysia) has invited the company to establish a bioenergy park where it will grow jatropha.
Labland is also the technical partner of a Portuguese firm in a 1 million ha jatropha plantation in Mozambique.
Palm oil procured from Indonesia and Malaysia is usually the vegetable oil that is converted to biodiesel. However, large-scale production of palm oil has affected food crop production, because people are growing the palm oil at the cost of food crops. Unlike palm plants, however, jatropha can grow almost anywhere.
“That’s why everybody is looking at jatropha,” said A.K. Bansal, director (corporate affairs), Bharat Petroleum Corp. Ltd. BPCL is among the companies looking at contract farming of jatropha in India.
Jatropha has piqued the interest of Indian companies and governments, but firms interested in cultivating the plant said it isn’t easy to get land. “The hurdles in getting land is one of the major reasons we are looking abroad,” said Jaya Kumar. “In Malaysia, (state) governments are falling over (each other) to woo companies to develop their wastelands,” he added.
In a report released in 2003, the Planning Commission, India’s apex policy planning body, proposed launching the National Mission on Biodiesel, under which 2.2 million ha would be brought under jatropha cultivation by 2007. According to data from the ministry of rural development, only 0.4 million ha is under jatropha cultivation.
“The best we can do at a Central level is exhort,” said a senior official at the ministry who didn’t wish to be identified. “The states have to look at the implementation aspects,” he added.
A national biofuels policy, which was to have taken shape in 2005, has been indefinitely postponed to 2008. “I am aware of the biodiesel industry’s interest in foreign shores, but what else do you expect?” asked Sandeep Chaturvedi, president, Biodiesel Association of India, an industry lobby group. “Malaysia’s success in biofuels is because of sustained policy measures over the last two decades,” Chaturvedi added.
Mamta Wadhwa, director at research organization Frost & Sullivan, said regulations governing land acquisition in South-East Asia were “relatively easy”.