The group of ministers (GoM) headed by the Union agriculture minister, Sharad Pawar on Wednesday approved the National Bio-fuel Policy drafted by the ministry for new and renewable energy sources.

It could not finalise many other pending issues and took a short-cut route by approving formation of National Bio-fuel Coordination Committee under the chairmanship of Prime Minister, Manmohan Singh to deal with any emerging problem. “The proposals of the GoM, including the approved draft National Bio-fuel Policy would be sent to the Union Cabinet for consideration,” said a senior official in the Union ministry for new and renewable energy sources.

National Bio-fuel Policy, however, assures that bio-fuel programme would not compete with food security and fertile farm lands would not be diverted for plantation of bio-fuel crops. The policy draft also deals with a number of issues like minimum support prices (MSPs) for bio-fuel crops, subsidies for growers of bio-fuel crops, marketing of oil-bearing seeds, subsidies and fiscal concessions for the bio-fuel industry, R&D, mandatory blending of auto-fuel with bio-fuel, quality norms, testing and certification of bio-fuels.

The GoM consisting of the science and technology minister, Kapil Sibal, Planning Commission deputy chairman, Montek Singh Ahluwalia, panchayati raj minister, Mani Shankar Aiyer, rural development minister, Raghuvansh Prasad Singh, finance minister P Chidambaram, new and renewable energy minister, Villas Muttemar, and communications and IT minister, A Raja still could not resolve the tussle between the two rival ministries – rural development ministry and new and renewable energy sources ministry – over the budgetary allocations for their proposed programmes on bio-fuel.

The new and renewable energy ministry has suggested the setting up of a National Bio-fuel Development Board (NBDB), which would determine the MSPs for bio-fuel feedstocks like jatropha, karanja seeds, and other oil-bearing materials. It also suggested that the government render financial support to oil processors for a period of five years. Though the GoM could not finalise the proposal for setting up of the NBDB, much of the proposals of the new and renewable energy sources are coved under the approved draft National Bio-fuel Policy.  The delay in setting up of the NBDB would also not be a problem as the National Bio-fuel Coordination Committee under the chairmanship of the prime minister, Manmohan Singh would deal with the issues.

The rural development ministry has demanded a gross budgetary support