India pins biofuel hope on jatropha, output to rise

By Naveen Thukral and Niluksi Koswanage

KUALA LUMPUR (Reuters) - India is forecast to produce 2 million tonnes of biodiesel by 2012 as it aggressively plants wild jatropha oilseed to meet growing hunger for energy, a senior industry official said on Thursday.

The nation has identified 64 million hectares of wasteland that can be planted with jatropha, a non-edible oilseed which grows even on arid land in most warm climates and needs little care.

"India has 64 million hectares of wasteland and we asked the government to just provide 20 percent of the wasteland for planting jatropha," said Rajiv Gulati, vice president of Biodiesel Association of India.

In anticipation of the rapidly evolving biofuels market, dozens of private firms are contracting villagers to grow the hardy, oil-rich plant in their mostly barren plots of land. But now several corporates, farmer groups and cooperatives were taking the plunge as states were allocating wasteland for oilseed cultivation, Gulati said.

"Some state governments have already started giving land to interested parties, but it comes with conditions," Gulati told Reuters in an interview.

"Some of the conditions include growing jatropha plantations within a set time frame."

TO REPLACE DIESEL