PFC and JBIC sign loan agreement for bamboo-based bio ethanol project in Assam

Power Finance Corporation Limited (PFC) has signed a loan agreement worth about Rs 32 billion with the Japan Bank for International Cooperation (JBIC) to fund a bamboo-based bio ethanol and chemicals project in Assam. 

The financing will support Assam Bio Ethanol Private Limited’s second-generation plant, which will use bamboo as feedstock to produce bioethanol and chemicals.

The agreement was signed under JBIC’s Global Action for Reconciling Economic Growth and Environmental Preservation (GREEN) initiative. The loan totals up to JPY 60 billion, with JBIC contributing JPY 36 billion. It is co-financed by Sumitomo Mitsui Banking Corporation, The Joyo Bank, Kansai Mirai Bank, and Kiraboshi Bank. JBIC will also provide a guarantee for the portion arranged by private financial institutions.

The project is located in Golaghat district, Assam. Assam Bio Ethanol Private Limited will produce biofuel using bamboo sourced from the Northeastern states and sell bioethanol for blending with gasoline. The project is being supported through the credit line signed between JBIC and PFC in January 2025 for renewable energy and next-generation energy supply projects.

India’s biofuel policy targets 20 percent ethanol blending (E20) by 2025. The Assam project supports this goal and the Act East Policy for Northeastern growth. The financing will boost bamboo demand, raise farmer incomes, and support climate targets through lower-impact ethanol.