Dialogue October- December, 2007, Volume 9  No. 2

Bio-Fuels Initiatives in Southeast Asia: Options  for India

Pankaj Kumar Jha*

Quite a number of countries in Southeast Asia have been looking for alternate sources of energy including nuclear energy. But the most prominent problem with nuclear energy has been the exploration, processing and disposal of the nuclear fuel. The disposal of the nuclear waste sometimes becomes a costly affair and also there are problems with regard to decommissioning of nuclear power plant. So the next best alternative has been the bio-fuels. Southeast Asia as a region has been taking giant strides in this context and each country has been taking its own route for practical use of bio fuels. The foremost among them have been Malaysia, Indonesia and Philippines. Thailand has also taken policy stance in this regard. But it would be a long time when bio fuels become an alternative to the non-renewable fuel. The paper discusses the initiatives taken by the countries of Southeast Asia and the legislative regulations that have been stipulated in this regard. It also analyses Indian stance in this regard and how it can cooperate with its south-eastern neighbours. The paper also discusses the problems associated with such a step and what could be fallouts of the bio fuel research and practical use.                                                              

 In the contemporary world there is large scale dependence on fossil fuels for its energy needs, there are two other sources of energy, both of which manifest itself as electricity. These are hydroelectric power and nuclear power; each contributes significantly to global electric

*Dr. Pankaj Jha is Associate Fellow at IDSA. His areas of interests include Southeast Asia, terrorism, defence industry and related economic issues. He has presented papers in many international conferences/ seminars and has published research papers and articles in Indian Defence Review, Indian Ocean Digest, World Focus, India Quarterly and South Asian Politics.

supply. The scope for increasing hydroelectric power is limited by the proximity of mountain terrain to urban centres of population and by the availability of land suitable for reservoirs, while that for nuclear power is affected by political considerations in addressing the perceived issues of safety and security. In the long term, the use of fossil fuels would be restricted owing to concerns over atmospheric pollution and later due to resource depletion. This might very well force the world community to move progressively from the fossil fuel age to renewable forms of energy that are non- polluting and secure in supply1. In this regard bio energy is the viable alternative in the present context.

     Bio energy is the general term for any form of renewable energy made from organic materials2. Biofuels are just one form of bio-energy. Specifically they are transportation fuels (ethanol and bio-diesel) made from renewable resources like corn and soyabeans3. Due to the fast depleting fossil fuel resources and the increasing carbon levels in the atmosphere the research and initiatives were taken for increasing the use of bio fuels. The increasing oil prices have also forced the high consumption countries in Asia to look for Bio fuel research and using it for energy production as well as for running vehicles.

       The growing thrust towards a cleaner and greener environment has led to the search for more renewable sources of fuel and energy. The advent of Kyoto Protocol and its concomitant effects of carbon trading have provided impetus to renewed interest in bio fuels. Two of the more popular bio fuels are ethanol and bio diesel for gasoline and diesel engines respectively.                                                                               

Ethanol is a high octane renewable fuel which can be produced from a number of different feed stocks like sugarcane, corn, cassava and other crops. Meanwhile bio diesel production uses domestic raw materials from coconut, oil palm, jatropha, used cooking oil and other bio mass sources. Thus a significant multiplier can cut across the supply chain form growing to manufacturing and logistics. The requirement for locally grown feed stocks will increase utilization of agricultural land, promote investment, and create jobs. Bio diesel is also an environment friendly product that drastically cut emissions4.Europe has been at the forefront of bio fuel consumption and this surge in bio fuel demand as well their own domestic oil prices and  support subsides compulsions have forced Southeast Asian countries for look for bio fuel option.                  

Southeast Asian countries, as emerging economies with a high potential for bio energy, continue to pursue a greater share of Bio energy in the power generation mix. High oil prices, fast growing oil import dependence, and strong impact on transport fuels are giving added impetus to substitution in favour of bio energy for stationary applications and the development of bio fuel extenders and substitutes for the transport sector. Understandably, Thailand and the Philippines are taking the lead in bio fuels with tax and financial incentives for focusing on promotion of bio fuel development and which in turn would give propulsion to the rural development.From Vietnam to Singapore to Indonesia, Asia is growing its bio fuels production base for fuel ethanol and bio diesel, ready for usage as well as export to India, China, Japan, Europe and US. The current pause is seen as transitory as the global emphasis on renewable energy is here to stay. The recent Philippines Bio fuels Act offers a booster for the regional bio fuels industry. It is estimated that the annual demand for ethanol will grow to the range of 200m and 400m litres. It is to be seen when will the other Asian countries roll out their bio fuels mandate?5                                                                                   

In fact Southeast Asia has been at the forefront of initiative with regard to bio-fuels with Malaysia and Indonesia leading the way owing to the successful use of palm oil for production of bio diesel6 Prior to initiating any discourse about the bio fuels it is important to decipher the terminology about the bio-fuels.  Bio fuel is one that does not add to the stock of total carbon dioxide in the atmosphere. These are plant forms that, typically, remove carbon dioxide from the atmosphere, and give up the same amount when burnt. The bio fuels are therefore considered to be “CO2 neutral”, not adding to the carbon dioxide level in the atmosphere7.Bio fuels are produced from living organisms or from metabolic by-products (organic or food waste products). In order to be considered a bio fuel the fuel must contain over 80 percent renewable materials8.

      Bio fuels give an alternative form of energy which is renewable and can be produced locally without relying on outside support. This ensures reduced reliance on imported fossil  fuels for countries  which have been dependent on external imports. The major attractions of bio diesel are:

     > It provides a transport fuel from a renewable source;

     > Reduces dependence on imported fuel

     > Can be distributed via the existing petroleum supply infrastructure;

     > Introduces a new rural industry and a new market for farmers;

     > Can be used in standard, unmodified diesel engines;

     > Contains no sulphur or aromatic compounds

     > Is bio degradable9.

      The countries of Southeast Asia have taken initiatives in this regard owing to the possibility of extracting fuels from bio mass and also from various seeds and palm oil. The result has been the institutionalisation of the bio fuels utilisation and also joint research in the areas .

Regional Initiatives in Southeast Asia

       To address regions-wise energy issues, the Association of Southeast Asian Nations (ASEAN) Senior Officials Meeting on Energy (SOME) and the ASEAN Ministers of Energy Meeting are held annually for future regional policy and programmes. With the increasing recognition among the countries of southeast Asia that ASEAN is becoming increasingly dependent on oil imports, the countries of the region have been developing a mechanism for regional consultation and coordination during a petroleum supply shortage and emergency .But to address issues of long term security, energy mix and source diversification, sectoral efficiency, and environment sustainability, ASEAN policy makers continue to work towards the Trans-ASEAN Energy Network, made up of the ASEAN Power Grid (APG) and the Trans-ASEAN Gas Pipeline. Also in terms of cooperation in energy efficiency and conservation various projects have been implemented including the ASEAN energy benchmarking system for building, ASEAN Energy Management Accreditation System (AEMAS) and ASEAN Standards and Labelling System. Apart from energy efficiency ASEAN has now looks towards cooperation in Renewable Energy (RE).10 Even in the Second East Asian Summit stress was laid on energy efficiency and renewable sources of energy. But the initiatives that have been taken at the regional level have rather been at a nascent stage and more stress has been on exploring new sources of fossil fuels and energy efficiency. The initiatives at national level by the countries in southeast Asia has been encouraging. While countries like Indonesia and Malaysia are devising a bio fuel policy for earning that vital foreign exchange through bio fuel exports, Thailand and Philippines are looking for carefully implementing the bio fuels usage in domestic market.

Malaysia: Bio Diesel through Palm Oil

      The production of bio diesel from palm oil had long been promoted by the Malaysian government, since 2001. According to the Malaysian Palm Oil Board (MPOB) Strategic Plan 2001-05, the focus on developing the country’s capabilities in the production of bio diesel from palm oil is regarded as a ‘defensive’ strategy to increase the usage of the country’s palm oil output while also propping up the commodity’s price. The MPOB Strategy Plan had identified its focus on 1) developing scaled up technologies for extraction of the minor component nutraceuticals from palm oil methyl ester (palm oil bio diesel); 2) attracting venture capitalists, and 3) getting government support through tax and regulatory measures.                                                                                                    Malaysia initiated National Bio fuel policy (also known as National Bio Diesel Policy) introduced by the Malaysian government basically entails a four pronged strategy, which encompasses

1.    Producing a bio-diesel fuel blend of 5% processed palm oil      

       with 95% petroleum diesel.                                                                              

2.    Encouraging the use of bio fuel among the public, which will    

       involve giving out incentives for oil retail companies to provide bio diesel pumps at stations.

3.    Establishing an industry standard for bio diesel quality, this will be the responsibility of regulatory body.

          4.    Setting up of a palm oil bio diesel plant, which is targeted to be built in Labu, Negri Sembilan.                                              

In addition, the government would set up a demonstration mill for the production of bio fuel for cold climates, which is a strategy for the marketing of Malaysia’s bio fuel in the export markets. The government would also award a contract to a plantation company to ensure a consistent supply of palm oil for the production of palm oil bio fuel. It also provided some sort of incentive to automotive companies to produce bio fuel-ready engines. To encourage the use of bio fuel on a trial basis, oil companies have been asked to cooperate with the Malaysian Palm Oil Board (MPOB) to create pioneer kiosks. In the longer term, the National Bio Diesel Policy will include establishing a National Bio Fuel Industry Act as well as providing several more incentives11.

      The major factors for initiating concrete approach towards bio fuel have been the need for blending of diesel with palm oil based bio diesel to power cars and electricity generators and the likely increase in its demand from countries like Japan, South Korea and Europe. Petronas has been planning to build a 200,000 tonne per year methyl ester plant. Malaysia is aiming to gain at least 10 per cent of the market share of bio fuels owing to the expansion in the demand of bio fuels by 25 per cent each year since 200412. Malaysia has also been getting investments from Australia and Italy for setting up of the commercial bio diesel plant in that country.

      With some 75 bio diesel projects either in operation or in the pipeline, Malaysia is already considerably ahead of Indonesia. Golden Hope Plantations, Genting BhD and Sime Darby BhD13 are the major bio diesel players some of which have expanded their franchises into Indonesia based plantations.

Indonesia: Looking for Bio-fuels Options

     In the face of its depleting oil reserves and fluctuating world oil prices, Indonesia has launched bio fuel production program aimed at cutting its fossil fuel consumption by 10 per cent in 2010. Besides reducing dependence on fossil fuels, the cultivation of bio fuel crops such as palm oil, Sugarcane and Jatropha curcas crops were also seen as a way to boost local economies. In order to carry out the programme, the Indonesian government decided to set up a national team formulating policies for the development of bio fuel or bio diesel programme, including matters of cultivation of land, infrastructure, processing, marketing and funding. Under the programme the Indonesian government has stressed on the development of 11 bio diesel plants in various parts of the country. The plants will have a total production capacity of 26,000 tons per annum equal to about 45 per cent of annual consumption in Jakarta. An inter ministerial team estimated that the country’s bio diesel production would; reach 187 million litres by the end of 2007 and 1.3 billion litres in 2010. Indonesian government is also preparing fiscal incentives for investment, trade and research to enhance bio fuel production14.                                                                                  

Indonesia also faces wrath of the environmentalists while pursuing its energy development programme owing to the availability of peat land soils there. Peat land rainforests are wet swampy rainforests that when drained and cleared, their peat filled soil become highly susceptible to long burning, carbon and methane rich fires. Such rainforests on peat soils are one of the world’s most important carbon sinks and play a vital role in helping to regulate the global climate15. The peat lands are likely to be destroyed for palm oil, timber and paper and pulp companies. So the balance of controlling carbon emissions and absorption through nature has become a major issue between the environmentalists and development proponents. It would be seen how Indonesia balances the two different points of view.

Vietnam: Nurturing Newer Forms of Bio –Fuels

      Vietnam has been slow in initiating the various options for bio fuels. One of those is to turn Catfish fat into bio fuel to run diesel engines. One of the major catfish exporters Agifish had sought government approval to build a factory in the southern Mekong delta province of An Giang and had proposed for production of about 10 million litres of fuel. The Vietnamese government had given the clearance for the same. In fact Vietnam had been exporting catfish to US and Europe but in the past the catfish exports had faced sanctions and quota restrictions and so catfish has been seen as a viable alternative to fossil fuels. Vietnam could also look into the options of ethanol but due to the scarcity of sugarcane, it had been looking for other alternatives also. Bio Fuels Researchers at the Centre for Petrochemical Technology in Vietnam have been looking at mixing the waste cooking oil with diesel to make cheaper fuel. In fact the two-year pilot project initiated in 2006 has endorsed use of waste cooking oil for this project. This would also reduce pollution in the streams and rivers.

    Vietnam has not embarked in a big way as compared to its other ASEAN partners with regard to Bio Fuels but has made significant steps in the field of research.

Myanmar: Search for Alternatives

       Myanmar is planning to grow castor bean on 50,000 acres in each of its nine military divisions for use as bio fuel16. It has the climatic conditions and soil conducive for production of castor beans. Myanmar has been relying on the extensive gas and oil deposits and so has not looked at the options of bio fuels in a major way. Owing to its isolation in ASEAN, it has not been able to get technology relevant for bio fuel research.

Laos: Lack of Investments

      Within Laos whatever steps have been taken in bio-fuel research has been through small Non Governmental Organisations (NGOs) like Sunlabob. One of the options that have been explored is getting oil from Jatropha seeds. The oil is comparable to diesel and after processing can be used as Bio Diesel in motor vehicles. The Laos Association of Organic Farmers had explored the viability of Jatropha oil in Laos17. Jatropha oil had been used in Motors for generating electricity. But more than anything those NGOs which are working in the field of rural electrification and generating Bio diesel options have also been facing resource crunch. More than anything else due to the lack of funds even from the government channels, the NGOs have set out for investors so that the pilot project on rural electrification through Jatropha could be launched in a more comprehensive way.

Philippines: More Legislative Enforcement

    The Philippines President Gloria Macapaghal Arroyo had urged member countries of ASEAN to begin producing flexible fuels engines for vehicles that can run on bio fuels. Also at the national level, Philippines had initiated a law known as the Bio Fuels Act of 2006. The new law ordains a minimum one percent of bio fuel blended to diesel within the first year of its inception which should be increased to four to five percent in next two years. The law provides tax exemption, financial incentives to encourage investments in bio fuels18.The law is in consistence with the declaration on East Asian Energy Security ratified by the 16 heads of the states or government of ASEAN and its dialogue partners during the second East Asian Summit in Philippines19.                        

Philippines has also initiated dialogue with Thailand to pursue the development of common standards for bio fuels. Philippines had therefore proposed to start a workshop that would allow countries to exchange information on the status of their respective national efforts on developing bio fuels standards and to determine the next steps for future also Philippines has planned to plant more than 1 million hectares of Jatropa20. Diversification of renewable fuel sources has been the agenda for Philippines which is duly supported by government and public sector initiatives.

Singapore: Developing Refining Capacity

       It is known fact that Singapore lacks the agricultural land for growing any bio fuel feed stock. Owing to its technological superiority and management skills it has opted for providing a large bio diesel refining and processing facility. Singapore is well placed to develop such an industry as it has easy access to palm oil, a key bio diesel ingredient. Peter Cremer, the Asian arm of Germany’s Cremer gruppe, plans to set up a $ 20 million plant in Singapore by 2007 with enough capacity to produce 200,000 tonnes of Bio diesel21. Apart from that Natural fuel, global group of renewable energy companies, headquartered in Western Australia, announced that they have chosen Singapore as its site for their US$ 130 million state of the art bio diesel production facility which is scheduled to start production in 2007. The facility would have an annual production capacity of 600,000 metric tonnes of bio diesel. Singapore has been chosen as the location for the bio diesel facility owing to its strategic location, better logistics facility and experience in petrochemical industry22 which projects the future potential of Singapore as a regional hub for bio diesel facility. As already Singapore has the world’s third largest oil refinery centre and due to growing awareness about bio fuels in Southeast Asia the new refining and production facility is surely going to enhance Singapore’s standing at the regional level for Bio diesel production.  Malaysia also has been keen on promoting Singapore as a bio diesel refining centre due to its proximity with Johor. Malaysia, had made plans in the past for a petro chemical hub at Jurong Island23 but due to stiff global competition, it has now planned for setting up bio fuel production facility in Johor which is closer to Singapore border.

Thailand: The Jatropha and Ethanol Option

       Bio Fuels have been promoted in Thailand in the past through a bio fuels product known as Gasohol 95 or so called E-10 which is a mixture of ethanol and Octane 91 gasoline at a ratio of 1 to 9. The Thai government has approved in 2005, a budget of $32.5 for Bio diesel development during 2005-2012 and has also initiated a phased plan for production of bio fuels24.

       Thailand, with its abundant agricultural resources, is well positioned to effectively deploy bio-fuels-ethanol and bio diesel in helping meet its energy needs. For production of ethanol to produce gasohol, Thailand can produce ethanol from sugarcane, cassava and oil palm. At present, there are altogether 6 private sector plants that have been approved to produce ethanol, with a total production capacity of 1.09 million litres/day25.These initiatives are part of the Thai government plan for self reliance in bio fuels sector. The Thai Government has formulated a two phase gasohol (gasoline-ethanol blend) programme. In phase 1 (2004-2006), in addition to the three ethanol plants currently operating, three others became partially operational by 2006, For phase 2 (2007-2012), the government awarded licences to 18 new bio diesel plants, and this is expected to bring the total installed capacity to 3 million litres/day by 2012. Of the 18 new plants in phase 2, 14 will use molasses as feedstock and the remaining four will be cassava based. Thailand is world’s largest producer of cassava, with an average output of 20 million tons a year. The key element of Thai Government’s strategic plan for bio diesel is plantation development for the vegetable oil crops to be used as feedstock, palm oil, Jatropha. The government plans to develop palm plantations totalling 0.7 million hectares which would yield 4.8 million litres/day of bio diesel26. Thailand has initiated a structured approach with regard to bio-fuels but how far it would be feasible in the long run is yet to be seen.

India’s Steps in Bio Fuel Production

      In India the bio fuel gained  momentum in the post-2000 phase, when the Ministry of Petroleum and Natural gas decided to take up pilot projects at three locations in the major sugar producing states of Maharashtra and Uttar Pradesh to study the related aspects of blending ethanol with petrol and its use. In March 2002, the government gave the permission for the sale of E-527 across India. In September 2002, Indian government mandated that nine states and four union territories would have to sell E-5 by law from January 2003 onwards. Their combined demand was estimated at 345000 cubic metres per year. This was accompanied by an excise duty exemption for ethanol. In the next phase, supply of 5% ethanol blended petrol would be extended to the whole country. In view of the supply constraints from the sugar industry, the project was facing difficulties and with the failure of sugar crops in 2003-2004, India has had to import molasses and even ethanol to meet domestic needs28. So the success of the programme has been hampered by problems related to feed stocks supply, price agreements and reluctance of domestic oil companies.

     On the other hand the National Mission bio diesel programme consists of two phases .The first phase consists of demonstration projects covering both forest and non forest lands in various states across the country. The phase two of the mission would focus on uncovered areas with a target to achieve 20 per cent blending of bio diesel with diesel.

The Phase II of national mission is proposed to be people driven with the government playing the role of facilitator. It aims to expand the programme to cover up to 11 million hectare in phase II. The implementation will be done in a phased manner. The first step is to achieve a 5 per cent bio diesel blend in diesel in nine states; then aim at a 5 per cent bio diesel blend all over the country. Later the bio diesel percentage would be increased to 10 per cent across the country and lastly work towards more than 10 per cent bio diesel blend in the entire country.

      In fact India can tap the $ 52 billion global market for carbon trading by encouraging production and use of bio fuels and plantation of trees having oil bearing seeds and materials like Jatropha and Pongamia species. Other plantations having oil bearing seeds or materials are Sal, Mahua, Kokun, Pilu,  Phulwara, Dhuipa, Neem, Mago, Kusum, Karanja, Ratanjyot, Tumba, Jojoba and Simarouba29. 

      Unlike the countries like Malaysia or Thailand, the use of edible oils for bio diesel production is not an option for India at this stage since edible oils and seeds should be used to fulfil other primary needs. Some of the plants like Jatropha can be grown in areas with low availability of water and even in arid lands. Countries like Thailand are seeking Jatropha seeds from India to sustain their bio fuel production while India does not have a clear cut policy about the production and extraction of oil from Jatropha, though in Hyderabad a private sector company has initiated cultivation of Jatropha in an area of 45 hectares. Indian policy has not seen the light of the day or has been much more concerned about the fluctuating fuel prices rather than looking for alternatives.

       So, for India in order to gain distinct advantages with regard to Bio fuel sector, it has to develop infrastructure and transport in the mainland Southeast Asia and also engage Indonesia in a bigger way in order to have greater economies of scale and also reap the benefits of advancement of technology in the bio fuel sector. India would also have to strengthen  sub regional organisations like Bay of Bengal Initiative for Multi-Sectoral Technical and Economic Cooperation (BIMSTEC) while reviving stagnant organisations like Mekong Ganga Cooperation. Energy is the buzz word for the next decade and in order to strengthen its energy security apart from looking at new areas of fossil fuel supply it has to secure supplies in terms of bio fuels. Ethanol might be a big foreign exchange saver for India in the coming decade, as has happened in the case of Brazil, Due to large area under sugarcane cultivation India can provide cheap ethanol option to the countries of Southeast Asia. In case of Jatropha. India has to devise a policy and also look for available area for cultivation of this economic nut. The foreign exchange saving  and environment protection options are there.

Drawbacks of Bio- Fuels

      It is not that Bio Fuels are the best available option but it is true that it is the only visible option.  Firstly Bio diesel promotion has been facing wrath of the environmentalists in the past, because though it reduces the carbon emission but it also leads to deforestation for production of palm oil which in a way imbalances the carbon absorption capacity in  nature. There has been a serious row of words between the western countries and Malaysia and Indonesia because of their plans for deforestation for availing more land for palm oil plantations. Also Bio fuels are expensive as growing  sufficient crops to satisfy global energy demand  require large tracts of land.

    Secondly, Bio fuels pertaining to the energy security and with increasing oil prices might become a lucrative option for agricultural farmers to opt for production of such oil rich cash crops and this would lead to shortages of food and thus impoverishment of poorer nations of the world. Bio Fuels are cost effective only when fossil fuel prices hover between $75-80 per barrel otherwise large scale production can only offset the costs disadvantages. Thirdly, bio diesel facility and even consumption has not been projected as a cost effective option and so until and unless there is large scale production and consumption bio diesel might not find many takers in the near future. Also the availability and distribution of bio diesel is another problem. Due to the mixing of water in ethanol blend fuel might damage engines in the long run. So the options have to be carefully weighed for greater benefits of any such global initiative.

How Feasible are the other Alternatives

        Looking for the other alternatives like solar energy and hydro power, the depleting water resources and growing global population has put a question mark on the likely sustainability of hydropower while on the other hand, solar power has few takers but the equipment and research in this area is quite costly. Also solar power might not be a feasible alternative for motor cars but can be a suitable source for electrification. On the other hand wind energy and geo thermal energy are good options but these are not cost effective.

      Taking the issue of cleaner fuels like nuclear energy, the problem of exploration, processing, reprocessing and disposal of nuclear fuels is the most costly option and also the decommissioning of any nuclear power plant is a very tedious process with a risk factor attached to it because of devastating nuclear fissile material leakage incidents in the past in Russia and US. The other forms of energy like hydrogen are not very cost effective and also technology pertaining to develop those areas of energy have been the forte of western countries and few private players and so the Bio fuels as has been discussed provide the only cost effective and low technology option for the developing countries of Asia.

Conclusion

     Countries in southeast Asia have taken few concrete steps to promote use of bio fuels but more than anything the regional efforts and research and development of Bio fuels has not taken off in a big way. Owing to the surge in demand of bio fuels in Europe and other western countries have given an revenue option for countries like Malaysia and Indonesia while Singapore wants to leverage its strategic location in this regard. Philippines has taken few legislative measures for the same but it is to be seen how the government employs those regulations and in which way people abide to use bio fuels. Thailand on the other hand has a clearer policy but has been clamouring for more research and funds in the area. Thailand is not very sure of the feasibility of the projects initiated and with the aim to diversify has started looking for supply of Jatropha from countries like India. Vietnam and Laos does have the potential but then Vietnam has huge gas reserves as alternative while Laos has not enough funds to support the use of Bio fuels. Myanmar has the will and also the land mass for necessary production of feedstock but lacks any technical know-how in this regard.

     In such a milieu it would be feasible for most of the countries of Southeast Asia to pool their technical know-how and also diversify their resources as well as options for extracting bio fuels in the long run because only then the countries in the region would be able to have a comparative cost benefit analysis of the options available. Bio fuels have the potential to give a boost to agricultural economies and thus it might narrow the gap between the prosperous and not so prosperous nations of the region. India can gain through greater integrated cooperation with the countries of Southeast Asia because the time line for implementation of cleaner energy and bio fuels in the region is pegged at 2010. India can enhance its capability with regard to research in the area and also as it has large tracts of barren lands which could be used for cultivation of Jatropha. India can derive economic benefits also in this area. The countries like Thailand and Myanmar are working in the field of ethanol and Jatropha while Mynamar is slowly looking into the economic benefits of castor oil as the feed stock for Bio fuels. The complementarities are many and so India should engage the region in the bio fuel sector also.

      Bio fuels are a better futuristic option and an integrated policy would do wonders in this regard. More than anything the western countries have to initiate transfer of technology to the countries of the region rather than making hue and cry over deforestation so as to save precious forests and create a balance between carbon emission and absorption, because better technology would initiate energy efficiency as well as lower cost of production. Bio fuels are also viable option for generating employment in the rural sector and mitigating environmental pollution which has been increasing at an alarming rate due to use of fossil fuels. In this milieu it is important to pool resources and once again India could very well leverage its Look East Policy.

Reference:

2 Background on Bioenergy and Biofuels at http://www.in.gov/isda/biofuels/bioenergy-biofuels-backgrounder-011007%20_2_.pdf

3 Ibid

4 Bio Fuels: Creating New Opportunities for Agriculture, at http://www.ats.agr.gc.ca/asean/4299_e.htm (Accessed 25.6.2007)

5 http://www.biodieselspain.com/eventos/calendar.php?mode=view&id=152

6 Bio diesel, meanwhile, is an alternative or additive to standard diesel fuel that is made from Biological ingredients instead of petroleum. Bio diesel is usually made of bio oils through a Series of chemical reactions but is non-toxic and renewable. There are a few different ways to make bio diesel, but most manufacturing facilities in the world produce industrial bio diesel through a process called transesterification. In this process, the fat or oil is first purified and then reacted with an alcohol, usually methanol (CH3OH) or ethanol (CH3CH2OH), in the presence of a catalyst such as potassium hydroxide (KOH) or sodium hydroxide (NaOH). When this happens, the triacylglycerol (i.e., the oil or fat) is transformed to form esters and glycerol. The esters that remain are called biodiesel. Biodiesel blend is the blend of petroleum diesel and biodiesel. A blend of 5% biodiesel and 95% regular diesel is called a B5 blend. For more details see Malaysia Introduces the National Bio Fuel Policy, Industry Issue Bio Fuel Vol.3/2005, August 2005, at http://www.mvo.nl/biobrandstoffEN/download/Vol32005IndIssuebiofuelpolicy081205%5B1%5D.pdf (Accessed 24.10.2007).

7 Bio Fuels at http://www.habmigern2003.info/biogas/biofuels.html

8  Bio Fuels at http://www.alternative-energy-news.info/technology/biofuels/

9 R.M Dell and DAJ Rand, Clean Energy,RSC Clean Technology Mongraphs, Cambridge,UK

10 Energy Policies of IEA Countreis-2005 Review,International Energy Agency and OECD, Paris,2005,pp.250-251

11 Malaysia Introduces the National Bio Fuel Policy, Industry Issue Bio Fuel Vol.3/2005, August 2005, at  http://www.mvo.nl/biobrandstoffEN/download/Vol32005IndIssuebiofuelpolicy081205%5B1%5D.pdf (Accessed 24.10.2007)

12 Export drive for  bio fuels, at http://www.theaustralian.news.com.au/printpage/0,5942,19383765,00.html (Accessed 22.3.2007)

13 European blowback for Asian bio Fuels at http://www.atimes.com/atimes/printN.html (Accessed 22.5.2007)

14 Indonesia makes great efforts to develop bio fuel, at http://en.ce.cn/World/Asia-Pacific/200608/13/T20060813_8117046.shtml  (Accessed 22.4.2007)

15 Action Alert: Indonesia’s Bio Fuel Expansion on Rainforest Peat lands to Accelerate Climate Change at http://www.climateark.org/alerts/send.asp?id=indoensia_peatland (Accessed 22.3.2007)

16 astor Beans to be grown for biofuel, The Myanmar Times at http;//Myanmar.com/myanmartimes/MyanmarTimes15-299/n014.htm (Accessed 25.6.2007)

17 Bio-Fuel For Electricity in remote Lao Villages at www.sunlabob.com (Accessed 30.6.2007)

18 Philippines P[resident urges ASEAN to produce bio fuel run vehicles at http://www.vnagency.com.vn/pPrint.aspx?itemid=179993 (Accessed 23.6.2007)

19 Philippines to promote use of Bio Fuels as Alternative Energy at http://english.people.com.cn/200701/17/print20070117_342100.html (Accessed 25.6.2007)

20 Philippines in US$1.3Billion bio fuels Project at http://www.planetark.com/avantgo/dailynewsstory.cfm?newsid=42128 (Accessed 23.6.2007)

21 High Fuel prices are Leading Singapore to Bio Fuels, at http://www.eere.energy.gov/afdc/progs/dddown.cgi?afdc/WHATS_NEW/618/1/1 (Accessed 25.6.2007)

22 Singapore Chosen as Site for World’s Largest Bio Diesel Facility, at http://www.sedb.com/edb/sg/en_uk/index/ews_room/publicatiosn/singapore_investments3  (Accessed 25.6.2007)

23http://www.biznewsbd.com/english/newspage/newspage.asp?ID=6020982&file1=6&bulan  (Accessed 25.6.2007)

24 Thailand’s Statement on “Energy Infrastructure Development Plan” by Paichit Theinpaitoon at The ASEAN Energy Minister-CEO Dialogue Session, ASEAN Energy Business Forum 2005,July 14,2005 at http://www.eppo.go.th/inter/asean/AMEM23/AEBF2005-ThaiMinister.html (Accessed 25.6.2007)

25  Ibid

26 Joseph B. Gonsalves, An Assessment of Bio Fuels Industry in Thailand, United Nations Conference on Trade and Development (UNCTAD),                                    

 27 E-5 is five percent Ethanol mixed with petrol.

28 Luc Pelkmans and Andreas Papa Georgiou, Bio fuels in India, Premia, December 2005, pp.5-7

29 Bio Fuels can Fuel India’s Carbon trading Potential at http://www.financialexpress.com/fe_full_story.php?content_id=69206 (Accessed 3.7.2007) (Disclaimer:The views expressed in the paper is  personal opinion of the author and does not represent the views of the Institute).