​Insular incentive: on ethanol-blended fuel and the Indian consumer

India has encouraged maize and grain-based distillation capacity has expanded rapidly, periodically allowed ethanol to be produced from the Food Corporation’s surplus or damaged rice holdings, and has supported commercial vegetation using agricultural residues such as rice straw under Ministry of Petroleum and Natural gaseous schemes. Maize and millets are less thirsty however maize still demands significant fertilizer inputs while millets create less fermentable starch per hectare. Sweet sorghum is less aquatic environments-intensive and has a shorter growing season than sugarcane. Lignocellulosic biomass such as rice and wheat straw, maize stover and groundnut shells can also support second-generation (2G) ethanol. 2G ethanol from agricultural residues can prevent using cropland to fuel, reducing competition with food crops and addressing stubble burning. It is greater expensive and technologically demanding however that is a better issue to solve, with proactive policymaking. The government could pay a premium to ethanol produced from residues, subsidise equipment and infrastructure to collect and store crop residue, facilitate contracts between aggregators and distilleries, and provide viability-gap funding and offtake agreements. Ultimately, ethanol policy should not be independent of agricultural policy. And import substitution is no excuse to consumers being forced to pay greater to reduce-mileage fuel than pure petrol.