New Delhi: Punjab government has signed a MoU with SAB Industries Ltd for the setting up of a bio-ethanol project with a proposed investment of Rs 719 crore.

The state’s Industry and Commerce minister Sundar Shyam Arora quoted in media reports as saying that this project will produce 25,000 TPA of Bio-ethanol from paddy straw collected from the state, according to an official release. It will not only generate employment but will also help in reducing crop residue burning, he stated.

The minister said few studies have indicated the availability of biomass to the tune of 120-160 million tonnes annually which, if converted, has the potential to yield 3,000 crore litres of ethanol annually. Surplus biomass/agricultural waste can be converted to ethanol using second generation (2G) technologies which have cellulosic and lignocellulosic content, the minister said in a statement here.

Arora said the ministry of Petroleum and Natural Gas, Government of India notified national policy on Biofuels-2018 to promote biofuels in the country. “This policy aims to increase usage of biofuels in the energy and transportation sectors of the country during the coming decade,” he said.