BRS MP demands resumption of FCI rice supply for ethanol production

New Delhi, Aug 9 (PTI) BRS leader B Parthasaradhi Reddy on Friday urged the government to restore the supply of broken and surplus rice through Food Corporation of India (FCI) for grain-based ethanol makers, which was halted in July 2023.

Speaking during Zero Hour in Rajya Sabha, Reddy said about 131 grain-based ethanol plants have been established across the country with an investment of Rs 25,000 crore in the last four years, inspired by the government’s biofuel policy.

However, the abrupt cessation of FCI rice supply has created a “shock wave” in the industry, he said.

“The shortage of feedstock is threatening the entire industry and adversely impacting the Centre’s ambitious E-20 target by 2025,” Reddy said.

The Bharat Rashtra Samithi (BRS) member noted that while the government has increased broken and damaged rice as well as maize rates from Rs 21 to Rs 29 per kg, the corresponding ethanol price adjustment is not proportional, making the industry unviable.

Reddy urged the government to allow maize imports under a tariff relief quota, similar to provisions for other feed industries.

He reminded that prior to 2018, the Centre depended solely on ethanol derived from molasses for fuel blending. In June 2018, a new biofuel policy was introduced to encourage the use of damaged foodgrains for ethanol production.

The BRS leader emphasized that the government needs about 1,000 crore litres of ethanol to meet the E-20 target by 2025.

The 131 grain-based ethanol plants have a capacity to produce 600 crore litres, meeting 60 per cent of the country’s overall requirement, he added.