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Set-up Bio-Diesel Production Unit in India

India is considered to be a diesel- deficit nation. Its production in India is not as per its rapidly growing demand. In order to overcome this deficiency, bio-diesel startup is the need of the hour in India. As it is considered to be a good substitute for conventional diesel. It is a renewable fuel that doesn’t pollute the environment and can comfortably work on any diesel-powered machine.

NOTE -“Small and medium enterprises have bought Biodiesel and sold to individual consumers and Progressive farmers, in order to supply energy for brick kilns, backup power diesel generators, etc.”

What will be the Investment and opportunities in the production of Bio-diesel in India?

From the analysis, it has been predicted that biodiesel production requires an investment of amount INR 20 Lakh -20 crore in India with a profit margin of up to 15%.

How much is the growth of Bio-diesel production in the Global Market?

It has been predicted from the expert report that the market of Bio-diesel production has increased from $82.7 billion in 2011 to $185.3 billion in 2021. It has also been noticed that there had been a steady growth in 2016 but the rapid increase in production between 2017 and 2021 due to higher oil prices, emerging mandates, and advanced technologies. It has been concluded that global biofuel production will reach 65.7 billion gallons per year (BGPY) by 2021.

What are the advantages of Bio-diesel as Fuel?

What are the disadvantages of Bio-diesel?

How to make Bio-diesel?

To make Bio-diesel, hydrocarbons (i.e oil or fats) are filtered and get mixed with alcohol, which are usually methanol and a catalyst. Ester and glycerol bio-diesel fuel, are the major products of this reaction which have been used for commercial purposes.

What is the effect of GST on Bio-diesel production in India?

Initially, with the implementation of GST 18% is a levy on Bio-diesel and ethanol, which has adversely impact the growth of the industry. The manufacturers applied to the department for reducing the rate to 5%. But currently, it has been reduced from 18% to 12%.

How can the Bio-Diesel Production Unit be Setup?

It can be set up in the following ways:

What steps to be considered before starting a Bio-diesel plant?

Complete research regarding the Bio-diesel Production

Before initiating a biodiesel production company, it is mandatory to spend time and money on research and feasibility studies related to biodiesel production[1].

Formation of Business Plan

For initiating this business, it is mandatory to prepare a prior business plan that clearly describes business and outlines goals that leads towards the success of the business. It is a document that describes the future of the business.

Selection of Location

The decision has to be taken regarding the location where to set up the plant for Bio-diesel Production.

Provisions related to Storage and Handling of biodiesel

Long-term storage problem, results in the case of untreated biodiesel blendstocks, as they generally exhibit poor oxidation stability, therefore the addition of anti-oxidation additives is necessary to improve its storage stability. In concern of all these problems, it is mandatory, to make prior provisions for Storage and Handling of biodiesel.

What Licenses and permits are required for Bio-diesel Production?

Company Registration:

  • For establishing the business of Bio-diesel Production, the applicant first registered its entity in the form of Partnership, Company, Limited Liability Partnership.

Factory Licenses:

  • District factory Inspectorate approval is required for setting up of the factory of Bio-diesel production.

Pollution Control Board Clearance:

  • In spite of ignoring this fact that, Multi-feedstock Biodiesel Processing Plants are non-polluting, it is mandatory to obtain clearance of pollution control board.

Explosive License:

  • An Explosive License is required from the Directorate of Explosive for the storage of Methanol.

At what rate, Import duty is charged on Biodiesel?

As Import of Biodiesel, Come in the following two categories:

How much Biodiesel is exported from India?

It has been analyzed that, in 2016, India has exported 53 million liters of B-100 at an estimated value greater than $27 million. Philippines, China, Malaysia, Spain, Netherlands, UAE, Nepal, and Kenya are the main (re-)export destinations.

Detail Information is provided on our website www.enterslice.com.

Narendra Kumar

Experienced Finance and Legal Professional with 12+ Years of Experience in Legal, Finance, Fintech, Blockchain, and Revenue Management.

Business Plan Consultant

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