New Delhi, March 24 The Centre is planning to propose to the Cabinet a plan to reduce the allocation of broken rice in grains distributed under the public distribution system from 25 per cent to 10 per cent, a move that would free approximately 90 lakh tonnes of broken rice annually for the ethanol sector, Food Secretary Sanjeev Chopra said on Tuesday.
This move comes as global crude oil prices have increased by around 40 per cent in the past three weeks.
Chopra said that India's blending of ethanol in petrol has already reached 20 per cent, up from just 1.5 per cent in 2013, saving the country over Rs 1.63 lakh crore in foreign exchange and reducing crude imports by 277 lakh metric tonnes since 2014.
The government is now focusing on increasing the supply of ethanol to the market, and raising the blending limit above 20 per cent, mixing ethanol with diesel, and promoting flex-fuel vehicles are all being actively considered, with decisions expected soon.
Speaking at the All India Distillers Association (AIDA) conference here, Chopra said that the proposal for broken rice would address a long-standing problem: in 2023, a poor sugar harvest and concerns about rice production had forced the government to restrict feedstock supply to distilleries, hurting the industry.
"Climate change is a reality. We need to ensure that the supply chain is not disrupted. A steady supply of broken rice to the ethanol sector will help ensure that," the food secretary said.
Currently, broken rice makes up 25 per cent of the grains distributed free to around 80 crore people under the government's food scheme.
Under the new plan, this would be reduced to 10 per cent. The extra broken rice from the 360-370 lakh tonnes distributed each year would be sold through auction to ethanol makers, animal feed producers, and others. A trial run has already been completed in five states.
From next year, the government will stop supplying whole-grain rice from Food Corporation of India (FCI) stocks to distilleries. Broken rice from the revamped food scheme will be used as a reliable, year-round feedstock, Chopra said.
He also urged distilleries to speed up the procurement of the current FCI rice allocation. Of the 52 lakh tonnes set aside this year, only 21 lakh tonnes have been procured so far. An additional 20 lakh tonnes is available, but the discounted price expires on June 30.
Maize is being promoted as a second alternative feedstock, particularly varieties that grow on rain-fed land without irrigation. The agriculture ministry is developing high-yield varieties that can produce five to six tonnes per hectare. Around 40 per cent of ethanol supply already comes from grain-based sources, mainly maize, Chopra said.
India's ethanol production capacity has grown from 420 crore litres in 2013-14 to nearly 2,000 crore litres today, with 650 crore litres added in just the past three years, he said.