India’s ethanol shift from sugarcane to grains fuels debate over farm priorities and subsidies
India’s ethanol programme is shifting from sugarcane to grain-based feedstocks, with maize and rice now contributing about 65% of production. Maize’s share has surged due to incentives and wider cultivation, though debates continue over productivity, water use, and the most sustainable feedstock for future ethanol expansion.
New Delhi: India’s ethanol blending programme, once largely dependent on sugarcane, is now witnessing a major shift towards grain-based feedstocks such as maize and rice, opening a wider debate on agricultural priorities, water use and the role of incentives in driving the country’s biofuel ambitions.
Industry representatives say the transition is intended to strengthen energy security, reduce dependence on a single crop and create additional income opportunities for farmers, The Print reported.
India’s ethanol programme has expanded significantly over the last decade. Ethanol procurement by public sector oil marketing companies (OMCs) increased from 38 crore litres in 2013-14 to 904 crore litres in 2024-25.
Blending levels have also climbed from 1.14 percent in 2014-15 to 20 percent in the ongoing Ethanol Supply Year (ESY) 2025-26, which runs from November 2025 to October 2026. Government data shows the programme has generated more than Rs 1.29 lakh crore in revenue for sugar mills and attracted investments exceeding Rs 42,000 crore.
With India moving beyond E20 blending—containing 20 percent ethanol and 80 percent petrol—and examining higher blends such as E85 and E100, attention is increasingly turning to the question of which crops should support the next phase of growth.
According to Bharati Balaji, deputy director general of the All-India Distillers Association (AIDA), grains including maize and rice now account for nearly 65 percent of India’s ethanol production, while sugarcane contributes the remaining share.
AIDA data shows that out of 1,059 crore litres contracted for supply in ESY 2025-26, nearly 515 crore litres had already been delivered in the first six months. Maize emerged as the largest individual feedstock with a contribution of 182 crore litres. Its share in ethanol production increased sharply from 6.2 percent in ESY 2022-23 to nearly 50 percent in ESY 2024-25.
Balaji said policymakers recognised the risks of relying on a single feedstock for a programme of this scale. While ethanol blending initially developed as a support mechanism for the sugar industry, the government later broadened the feedstock base to include maize, broken rice and damaged food grains.
She said maize cultivation gained momentum after incentives created a stronger market for farmers. According to her, many growers shifted towards maize after seeing improved earning opportunities.
Balaji also pointed to supply-chain advantages. Sugarcane production is concentrated mainly in Uttar Pradesh, Maharashtra and Karnataka, whereas maize and rice are cultivated across larger parts of the country, helping reduce dependence on a limited number of states for ethanol production.
At the same time, experts remain divided on which crop offers the most sustainable path.
Agricultural economist Ashok Gulati of the Indian Council for Research on International Economic Relations (ICRIER) said maize appears to be a more suitable feedstock than rice or sugarcane, but argued that India’s low productivity remains a major challenge.
He pointed out that the United States, which operates the world’s largest maize-based ethanol programme, produces around 11 tonnes of maize per hectare compared with nearly 3.5 tonnes in India.
According to Gulati, India would need improved technology, including genetically modified crops, to raise yields to around 6 to 8 tonnes per hectare before maize can become fully competitive for ethanol production.
He also argued that maize consumes significantly less water than competing crops. Maize generally requires three to four irrigations during a crop cycle, while rice in Punjab can require up to 22 irrigations and sugarcane in Maharashtra as many as 25 to 30.
However, findings from the ICAR-Indian Institute of Sugarcane Research (IISR) offer a different perspective. The institute’s analysis found sugarcane to be more efficient in water use for ethanol production, estimating monthly water consumption at 1,313 cubic metres per hectare compared with 1,691 cubic metres for maize and 2,548 cubic metres for rice.
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Source : ChiniMandi
