Stop Imports of Fuel Oil to Save Biodiesel

Stop Imports of Fuel Oil to Save Biodiesel

This would sound more like a continuation to my previous post and might also sound increasingly repetitive from me, but I think this must be said loud now that it’s high time that MoPNG bans/ or severely restricts import of any product under Chapter 27, please stop imports of fuel oil and furnace oil by private importers. 

The Indian Government has made some exemplary policy decisions to support the biodiesel industry. Right from maintaining high diesel prices in spite of political opposition, to exempting biodiesel from Essential Commodities Act to opening up of retailing of biodiesel to mandating supply of UCO (Used Cooking Oil) only for Biodiesel manufacturing, all these have been excellent policy decisions for the biodiesel Industry, and I am sure everyone in the biodiesel Industry acknowledges that, the biodiesel industry in India has seen exemplary vision and support for the industry over the past 5 years. 

However, the sad part is that all these policies significantly benefited the spurious fuel importers and traders, who imported and continue to import petroleum products like LLP (Light Liquid Paraffin oil), LAWS (Low Aromatic White Spirit), MTO, Base Oils..etc at very low prices in the name of Mixed Hydrocarbon oil or Fuel Oil or Furnace oil and are openly trading and retailing these in the name of Biodiesel or Fuel Oil or Furnace oil. 

In its defense, the MoPNG noticed this and did its best to tighten imports of Mixed hydrocarbon oil/ LAWS/ MTO..etc, and even did mass raids on such importers and traders about a couple of weeks back and sent some warning signals to these traders. But, the corrupt bureaucracy in the ports and in the state authorities who are responsible for scrutiny and implementation have ensured that these spurious imports and trade resume immediately without any major effect. 

These products are now brought in as Fuel Oil/ Furnace oil, and the colluding customs officials allow clearing of these without any major scrutiny as the importers who make hefty margins by selling these as Diesel and as Biodiesel in the market, pay these colluding customs officials handsomely. Many times, diesel or LAWS from gulf countries and MTO from OMCs are blended with furnace oil or fuel oil or base oil and imported into India, then these “so called Fuel oil or Furnace oil” are taken to distillation centres in Gujarat or Maharashtra or Chennai, and the diesel/ LAWS/MTO..etc are distilled off and sold as Biodiesel or fuel oil substituting diesel. All this because India still allows free imports of various petroleum products such as Fuel Oil/Furnace oil/LLP/MTO and Base oils. 

The government of India must step in urgently and ensure that imports of any petroleum product in Chapter 27 is completely banned or severely restricted at the least. India should use technology to ensure Digitization and traceability for every litre biodiesel B100 that is traded and retailed in India, instead of using raids and state authorities to ensure pure Biodiesel B100 is traded and retailed. 

When we Buyofuel are doing our best to push pure ASTM standard Biodiesel B100 to consumers offering complete digitization and traceability and were highlighting the recent raids on spurious biodiesel/ diesel to consumers, a trader of spurious biodiesel/diesel told me, in fact challenged me that, these imports of spurious diesel will continue in India and this will continue to be traded/ retailed as biodiesel, and that no raids or authorities will be able to stop this. Sadly though, he remains vindicated for now. 

However, I am sure that if the MoPNG can completely ban imports of products under Chapter 27, and Buyofuel along with the support of Biodiesel fraternity ensures complete digitization, transparency and traceability , we will be able to ensure the victory of Biodiesel over spurious diesel sold as biodiesel.