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FEB 27, 2005
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F&B Mythbusting
Just what is happening in India's booming food and beverages (F&B) business space? One helluva lot, according to Sujit Das Munshi, ED, ACNielsen South Asia. Log on for an exclusive column by him that doesn't just look at 'share-of-appetite' trends that F&B professionals cannot afford to miss, but also junks some preconceptions of the Indian palate.


McSwoop
McDonald's, with a new CEO back at heaquarters, is lowering a price bait to lure the budget-conscious Indian on-the-move bite-grabber. This fits into a broader strategy of multiplying customers that includes reaching out to McSceptics.

More Net Specials
Business Today,  February 13, 2005
 
 
ENERGY
Make Mine Ethanol
Indian automakers are scrambling to develop vehicles that can run on just about anything but oil.
WHO'S DOING WHAT
CNG
Ashok Leyland
Tata Motors
M&M
Maruti Udyog
Hindustan Motors
Bajaj Auto
Eicher
AUTO-LPG
Tata Motors
Hindustan Motors
Maruti
Bajaj Auto
ELECTRICITY+
Bajaj Auto
M&M
Maini Automobiles
Ashok Leyland
+This involves direct charging of a battery by connecting to the electric mains and not the production of electricity through the use of hydrogen, which is dealt with separately
ETHANOL
Tata Motors
M&M
BIO-DIESEL
DaimlerChrysler
Tata Motors
Mahindra (Tractors)
HYBRID ENGINES
Tata Motors
TVS Motors
FUEL CELLS
And other hydrogen-dependent energy sources including metal hydrides
Tata Motors
Bajaj Auto
M&M/IOC

Suhas Kadlaskar loves to drive. That's why he jumped at the prospect of test-driving an experimental Mercedes Benz on his employer's Pune test track. An experimental Merc? Well, it was actually a regular silver-grey C 220 powered by an experimental fuel-bio-diesel. And Kadlaskar is no daredevil test driver; he's the Finance Director of DaimlerChrysler India. He put the car through its paces on a sunny spring afternoon in March 2004... taking it up to 80-90 kmph. Bio-diesel gave a smoother ride than the regular fuel, emission was 70 per cent lower, and there was significantly lesser noise and vibration. Soon, he was out on Pune's streets, criss-crossing the city for an hour at a more sober 60 kmph. "We only changed the fuel tank and the fuel pipe; the modifications cost only Rs 2,000," he says. And not once did the car stall or lose power. The conclusion: Bio-diesel fulfils all the technical specs; the question marks relate to the logistics of availability and price. But more on that later.

A thousand kilometres away, in Faridabad on the outskirts of Delhi, is the 65-acre R&D centre of Indian Oil Corporation (IOC). Inside the lush green campus, scientists are working in partnership with Mahindra & Mahindra (M&M) to create the country's first hydrogen-powered vehicle. But the production of pure hydrogen-the most plentiful element on earth-for fuel is not easy. The gas is inflammable-and its production, storage and transport present huge difficulties. "The problem is that hydrogen likes the company of other elements, so the trick is to find an inexpensive way of separating hydrogen from other gases, and do it in large quantities," informs N.R. Raje, Director (Research, Refinery and Development), IOC. The present method of producing hydrogen from water through electrolysis is very expensive and, therefore, not financially viable on a large scale. Similarly, the production of hydrogen from solid biomass is also too expensive to make mass production viable. (See How They Stack Up).

This quest is more than a mere academic search for a motoring Holy Grail. Under a mandate from the National Hydrogen Energy Board (NHEB), set up in February 2004 by the Ministry of Non-Conventional Energy Sources, IOC will have to make available 10 per cent hydrogen-blended CNG fuel in Delhi, Mathura and Faridabad by June this year, and gradually increase it to 100 per cent by 2008 for three-wheelers, buses and cars. The goal: Creating fuelling infrastructure for over 1,000 vehicles by 2008. IOC's R&D centre has already successfully tested 10 to 30 per cent hydrogen-blended CNG fuel on Fiats and Ambassadors. "It's ddifficult, but do-able," says M.S. Ramachandran, Chairman, IOC, and a member of NHEB.

That's exactly what Kadlaskar feels about bio-diesel. DaimlerChrysler's Indian subsidiary, in collaboration with the Council for Scientific Industrial Research and Hohenheim University, Germany, is spending Rs 3.5 crore on a pilot project to grow Jatropha Curcas oilseed plants on two small plantations in Gujarat's Bhavnagar and Orissa's Behrampur districts. No, it's not entering the Indian agriculture sector. Yet. The vegetable oil extracted from Jatropha Curcas reacts with alcohol in the presence of a catalyst to produce bio-fuel. Two Merc C 220s that drove 5,900 km across the country using bio-diesel reported an average mileage of 12-13 km per litre, the same as for diesel. The fuel will enter Phase II tests in 2005-06: Mercedes-Benz plans to drive 10 cars over 30,000 km of difficult mountainous terrain to further test the fuel. But to really benefit from this breakthrough, India will need to generate 2.62 million tonnes of Jatropha (to ensure a mere 5 per cent blend with diesel) by 2007. That will mean bringing 2.2 million hectares under cultivation. "A significant number of farmers will have to come on board," informs Kadlaskar.

Bio-diesel gives a smoother ride than the regular fuel; emission is 70 per cent lower; and there is less noise and vibration. The question marks relate to the logistics of availability and price
Maini's Reva: The first

Meanwhile, an exclusive team of engineers and scientists at Tata Motors' Engineering Research Centres in Pune and Jamshedpur is working on an ambitious project to develop a zero-emission fuel cell-powered bus as well as a hybrid electric car. Also in the works are a bio-diesel-fuelled Indica and a project-in collaboration with IOC-to evaluate the impact of 7 per cent and 10 per cent ethanol on LCV 79, a commercial vehicle, Sumos and Safaris. Ethanol is oil, distilled from sugarcane in India, and corn and rapeseed in other parts of the world, which can be used to power internal combustion engines.

Commenting on the fuel cell-powered bus, V. Sumantran, Executive Director, Engineering Research Centre, Tata Motors, says: "The on-board fuel cell power system in the bus harnesses the chemical energy stored in hydrogen and converts it to electrical energy, which drives the motor. The benefits: No pollution and reduced noise and vibration." Its other project, the hybrid electric car-a prototype is expected to be ready this year-is expected to revolutionise the car industry. "It will be 20 per cent more fuel efficient and also have much lower emission levels," he adds.

Hydrogen-powered fuel cells have to overcome cost issues; ethanol and bio-diesel production are too insignificant to make a difference; and electricity-driven cars are still in their infancy
M&M's Bijlee: Another electric vehicle

Bajaj Auto has also jumped on to the alternative fuel bandwagon. It launched ecorick, an electric battery-driven auto-rickshaw, last month and hopes to sell around 1,200 vehicles by September. "The new vehicle, which costs Rs 1.5-1.6 lakh, is 50-60 per cent more expensive then the ordinary auto-rickshaw. But over a five-year life cycle, it will be 10 per cent cheaper," says Tapan Basu, General Manager (Electric Vehicles), Bajaj Auto. But the company will have to contend with difficulties related to recharging of batteries, proper infrastructure and the higher initial price. The company is trying to work around the first two problems by tying up with petrol pump owners such as IOC, Bharat Petroleum Corporation Limited and Hindustan Petroleum Corporation Limited to store batteries, which auto-rickshaw drivers can use while their own batteries are being charged. The company also plans to offer this facility at Bajaj showrooms and at tyre shops owned by other companies.

The future is here: Bajaj Auto's electric three-wheeler (top), and Ashok Leyland's hybrid electric vehicle (below)

But scientists at Bajaj Auto are really banking on the production of metal hydride as a fuel for three-wheelers. Metal hydride absorbs hydrogen and when heated it releases hydrogen, which is released as a fuel. The project is still in the experimental stage and a final breakthrough will take some years.

Other players like the Chennai-based Ashok Leyland and M&M, too, want a piece of the action. The former has already created the eco-friendly battery/diesel-operated Hybrid Electric Vehicle. And as mentioned earlier, M&M is going full steam ahead with its quest for a vehicle that runs on alternative fuels-despite the failure of Bijlee, its expensive battery-operated three-wheeler.

If these trials bear fruit, they will go a long way in ensuring India's oil security by reducing its dependence on foreign oil, and also provide huge relief on the balance of payments front. In 2003-04, the country's oil import bill was nearly Rs 80,784 crore. According to IOC's Ramachandran, India's dependence on foreign oil is likely to rise to 85 per cent by 2025, against 70 per cent now.

However, the Holy Grail is not yet in hand. Hydrogen-powered fuel cells have to overcome cost and infrastructure issues; ethanol and bio-diesel production are still too insignificant to make a difference; and electricity-driven cars are still in their infancy. Yet, as Tata Motor's Sumantran says, the future is pregnant with possibilities.

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