Diverting rice for fuel blending, a risky venture? 

Synopsis: Government’s plan to promote ethanol, its benefit to the country, various effects of this plan, its impact on crop diversification and food security and way forward. 


India is planning to use surplus rice, besides sugarcane, to meet its bio-fuel target of blending 20% ethanol with petrol. Could this pose problems for India’s crop diversification goals or worsen nutritional indicators? 

What’s the govt’s plan to promote ethanol? 

The government has planned to divert 17 million tonnes of surplus rice from its food stocks of 90 million tonnes to produce ethanol. This is in addition to the 2 million tonnes of sugar which is already being diverted to produce ethanol.  

-India is estimated to achieve about 8.5% blending with petrol by this year, which it plans to increase to a mandatory 20% blending by 2025.  

How would ethanol blending benefit India? 

Lower import of petroleum products: According to NITI Aayog, a successful biofuels programme can save India $4 billion or about ₹30,000 crore every year by lowering import of petroleum products.  

Emission reduction: Ethanol is less polluting and offers equivalent efficiency at a lower cost than petrol. 

The Centre expects that rising production of grains and sugarcane and feasibility of making vehicles compliant to ethanol-blended fuel makes its biofuels policy a strategic requirement.

What are the unintended effects of the policy? 

More stress on water– Increasing reliance on biofuels can push farmers to grow more water-intensive crops like sugarcane and rice, which currently use 70% of the available irrigation water. 

Impact on hunger situation in India: Experts have further raised concerns that the move could impact India’s hunger situation by limiting the coverage of the food security schemes.

Negative impact on crop diversification: Although the biofuels policy stresses on using less water-consuming crops, farmers prefer to grow more sugarcane and rice due to price support schemes.  

Diversion of sugar could be used as a temporary measure to reduce excess stocks of sugar, but in the long run, it would push farmers away from crop diversification strategy of growing more pulses and oilseeds which are less water-intensive.

Ethical concerns: As per some experts, it is unethical to use edible grains to produce ethanol in a country where hunger is severe. India, with 14% of its population undernourished and more than a third of its children stunted, ranks 94th out of 107 countries in the Global Hunger Index 2020.  

Rise in food prices: Diversion of mass consumption grains can push food prices up and can worsen our hunger problem.  

What is the way forward? 

Government needs to review its policy and plans to overcome the various others issues arising out of it and making its plan a success. 

Source: This post is based on the article “ Diverting rice for fuel blending, a risky venture? ” published in The Livemint on 12th October 2021. 

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