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Govt assures ethanol blending plan will not affect India's food security

Govt assures ethanol blending plan will not affect India's food security

Only the surplus quantities of sugar are diverted for ethanol production, which would otherwise have to be exported at subsidised rates to other countries.

The Ministry of Petroleum & Natural Gas said on Thursday that India's ambitious Ethanol blending plan will not affect the country's food security as meeting food grain demand is the top focus of the government. Noting that certain reports linked the Ethanol plan with food security fears in the country, the ministry categorically stated that they (reports) are unfounded, malicious and bereft of facts.

“Fuel demand is ever rising in the country and increasing dependence on crude oil imports can grossly hamper our future growth potential. Developing in-house fuels like ethanol, biodiesel, compressed biogas (CBG) has the potential to turn around the energy sector.” the ministry said.

During the last six years, the government has injected Rs.35,000 crore in the liquidity starved sugar industry by allowing the conversion of surplus sugarcane-based raw materials for ethanol production.

This has helped in improving cane farmers’ financial position. For the on-going season, it is expected that more than Rs 20,000 crore will be injected through the ethanol blending programme alone, which will fuel growth in the rural economy.

It is to be noted that only the surplus quantities of sugar are diverted for ethanol production, which would otherwise have to be exported at subsidised rates to other countries.

The government has also allowed for the conversion of surplus stocks of rice with Food Corporation of India (FCI) for ethanol production. It has also allowed the conversion of coarse grains like maize for ethanol production.

Despite distributing free rice and other grains during COVID-19, the FCI still holds huge stocks of rice. Moreover, an enhanced quantity of fresh rice stocks will start coming in as the agriculture season has been very good.

Higher conversion of maize to ethanol will also enable higher cattle feed production across the country which will aid the rural economy. This will also encourage farmers to switch crops and change their crop pattern in view of additional demand generated by the diversion of food grains to fuel.

Allowing alternative use to rice and maize will not only help aiding price stability to the farmers for their output but also enable new investment in distilleries and allied infrastructure.

This initiative also goes with the Prime Minister's Atmanirbhar Bharat initiative. It reduces the country’s dependence on imported crude oil, consumes our own produced environment-friendly fuel and pays remunerative prices to the Industry and Farmers.