Transforming the Ethanol Industry: Broken Rice Reallocation

The government is poised to propose a reduction in the allocation of broken rice in the public distribution system to the Cabinet. The aim is to decrease the distribution from 25% to 10%, which would free up roughly 90 lakh tonnes annually for the ethanol sector, stated Food Secretary Sanjeev Chopra.

This initiative emerges in response to a 40% increase in global crude oil prices over recent weeks. India has already enhanced its ethanol blending in petrol to 20%, which has cut crude imports by 277 lakh metric tonnes and saved over Rs 1.63 lakh crore in foreign exchange since 2014. The government is now exploring further ethanol incorporation, including blending limits, diesel mixing, and promoting flex-fuel vehicles.

At the All India Distillers Association conference, Chopra addressed the challenges faced by the ethanol industry, highlighting supply chain disruptions due to a poor sugar harvest and rice production worries in 2023. The new broken rice allocation plan is poised to stabilize feedstock supply, complemented by alternative feedstocks like maize. India's ethanol production capacity has notably increased from 420 to 2,000 crore litres since 2013.