Ethanol Push to Boost Farmer Incomes and Cut Fuel Imports

12-Apr-2025 12:04 PM

New Delhi: The Indian government is actively promoting domestic ethanol production, aiming to enhance clean fuel availability, reduce petroleum imports, and boost farmer incomes.

With an undeclared ban on ethanol imports from key global suppliers like the US, India is focusing on grain-based ethanol, especially using rice and maize.

While sugarcane has traditionally been the main source, maize usage is rapidly rising. A recent report highlights that this shift could increase farmers' income by ₹35,000 crore, as demand grows. India ranks second in rice production and sixth-seventh in maize, making it well-positioned to scale up.

Ethanol production using parboiled rice and maize is rising, supporting India's blending targets for petrol.

The report estimates 165 lakh tonnes of surplus grain will be used annually for ethanol, strengthening the rural economy and reducing foreign currency outflow due to petroleum imports.

With India spending the most on petroleum, followed by gold/silver and edible oil, the ethanol push could reshape energy and agricultural economics.