PATNA, April 6 -- The central government has agreed to remove the capping on ethanol procurement from grain-based plants in Bihar, ensuring that oil companies buy the entire quantity produced in the state, industries minister Dilip Kumar Jaiswal said here on Monday.

Talking to media persons, Jaiswal said that the Centre would soon issue directions to oil marketing companies to ramp up purchases from Bihar units. "The capping will end shortly. The state government's request has been accepted and orders are expected in the next one or two months," he said.

Bihar currently has 12 grain-based ethanol plants with a combined installed capacity of about 70 crore litres per year. For the past year, however, oil companies had been lifting only a...