This document summarizes the Indian government's response to Lok Sabha Unstarred Question No. 1607, addressed on July 29, 2025, regarding the establishment of agricultural byproduct industries. The Minister of State for Agriculture and Farmers Welfare, Shri Ram Nath Thakur, stated that there is no specific dedicated scheme for setting up industries based on agricultural byproducts. However, the "Creation/Expansion of Food Processing & Preservation Capacities," a component of the Pradhan Mantri Kisan Sampada Yojana (PMKSY) scheme under the Ministry of Food Processing Industries, aims to reduce waste through value addition.
Furthermore, to meet Ethanol Blended Petrol (EBP) program targets, the government has introduced ethanol interest subvention schemes for sugar mills/distilleries between 2018 and 2022. These schemes support the establishment of new ethanol plants or the expansion of existing ones, utilizing sugarcane and its byproducts (B-heavy molasses, C-heavy molasses) as well as grain-based feedstock.
The central government does not establish sugar mills. Since August 31, 1998, when the sugar industry was removed from the list requiring compulsory licensing, private entrepreneurs are free to set up sugar mills anywhere in the country, following the provisions outlined in clauses 6A to 6E of the Sugarcane Control Order, as amended.
Key Entities Referenced
Ministry of Agriculture and Farmers Welfare: A department of the Government of India responsible for agriculture and farmers' welfare.
Shri Virendra Singh: Member of Lok Sabha who raised the question about setting up agricultural byproduct industries.
SHRI RAM NATH THAKUR: Minister of State for Agriculture and Farmers Welfare, who provided the answer to the question.
Pradhan Mantri Kisan SAMPADA Yojana (PMKSY): A scheme under the Ministry of Food Processing Industries with the objective of creating capacities for value addition and reduction of waste.
Ministry of Food Processing Industries: A ministry of the Government of India responsible for food processing industries.
Ethanol blended with Petrol (EBP) Programme: A program that mandates blending targets and incentivizes ethanol production through interest subvention schemes.
Sugarcane Control, Order: Order that contains provisions on setting up of sugar mills in any part of the country.
Lok Sabha: The lower house of the Parliament of India.
O.I.H.
GOVERNMENT OF INDIA
MINISTRY OF AGRICULTURE AND FARMERS WELFARE
DEPARTMENT OF AGRICULTURE AND FARMERS WELFARE
LOK SABHA
UNSTARRED QUESTION NO. 1607
TO BE ANSWERED ON 29th JULY, 2025
SETTING UP OF AGRICULTURAL BY-PRODUCTS INDUSTRIES
1607. Shri Virendra Singh:
Will the Minister of AGRICULTURE AND FARMERS WELFARE कृ िष एवं िकसान क(cid:670)ाण मं(cid:361)ी
be pleased to state:
(a) whether the Government has any special scheme to set up industries based on the by-
products of agricultural produce in various States of the country;
(b) if so, the details thereof and if not, the reasons therefor;
(c) if so, the time by which the sugar mill will be set-up;
(d) whether the Government proposes to give exemption grant for setting up said industries
based on the by-products of agriculture; and
(e) if so, the details and percentage of exemption/grant likely to be given?
ANSWER
MINISTER OF STATE FOR AGRICULTURE AND FARMERS WELFARE
कृ िष एवं िकसान क(cid:670)ाण रा(cid:475) मं(cid:361)ी (SHRI RAM NATH THAKUR)
(a) to (e) There is no special scheme to set up industries based on the by-products of
agricultural produce. However, under Creation/ Expansion of Food Processing/
Preservation Capacities, a component scheme of Pradhan Mantri Kisan SAMPADA Yojana
(PMKSY) Scheme, Ministry of Food Processing Industries, one of the objectives is to create
capacities for value addition leading to reduction of waste.
The Government in order to achieve the blending targets mandated under Ethanol
blended with Petrol (EBP) Programme has notified various ethanol interest subvention
schemes for sugar mills/distilleries from 2018 to 2022 to set up new ethanol plants/capacity
expansion of existing ethanol plants based on sugarcane; its by-products such as B-heavy
molasses & C-heavy molasses and grain based feedstock across the country.
Further, the Central Government does not set up sugar mill in any part of the country.
Further, sugar industry was deleted from list of industries required compulsory licensing,
vide press note dated 31.08.1998. After that any entrepreneur is free to set up sugar mill in
any part of the country as per provisions laid down in clause 6A to 6E of Sugarcane
(Control), Order as amended from time to time.
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