The Ministry of Petroleum & Natural Gas has issued a comprehensive defense of India's Ethanol Blended Petrol (EBP) Programme against recent criticisms, clarifying that the program balances food security, farmer welfare, and energy security without compromising any of these objectives.
The Ministry explicitly refutes claims that the government sold FCI rice worth ₹37/kg to distilleries at ₹23/kg, causing a ₹10,000 crore loss, emphasizing that every food grain first serves the Public Distribution System, National Food Security Act, welfare schemes, and mandatory buffer stocks before any surplus is considered for ethanol production. Only damaged grain, broken rice, and foodgrain unfit for human consumption—stocks that would otherwise rot in warehouses—are used for ethanol production, turning waste into wealth while protecting food security for the poor.
The program utilizes a flexible mix of approved feedstocks with government-fixed ethanol prices: maize at ₹71.86/litre, sugarcane juice/syrup at ₹65.61/litre, damaged foodgrains at ₹64.00/litre, B-heavy molasses at ₹60.73/litre, FCI rice at ₹60.32/litre, and C-heavy molasses at ₹57.97/litre for ESY 2025-26. FCI rice contributed only 0.02% of ethanol production in ESY 2023-24, increasing to 24.64% in ESY 2025-26 only because surplus stocks became available after all food security needs were met, while maize's share declined from 42.6% to 35.96% during the same period, demonstrating feedstock flexibility.
The program's significant achievements include foreign exchange savings of over ₹1.97 lakh crore, substitution of over 316 lakh metric tonnes of crude oil imports, reduction of more than 950 lakh metric tonnes of CO₂ emissions, and payments of over ₹1.66 lakh crore to farmers and distillers. During the global oil price surge when the Indian crude basket reached approximately $135 per barrel, ethanol blending prevented petrol prices from reaching around ₹125 per litre in Delhi, instead maintaining prices at ₹94.77 per litre—a savings of nearly ₹30 per litre for consumers during the crisis period.
The Ministry emphasizes that the program serves as insurance against global oil shocks rather than day-to-day price competition, noting that India still imports nearly 88% of its oil requirements. The program is moving toward second-generation ethanol from agricultural residue through the Pradhan Mantri JI-VAN Yojana, further reducing dependence on food grains altogether.