India Plans to Reduce Broken Rice in PDS, Boosting Ethanol Production

Government Plans to Cut Broken Rice Share in PDS to Boost Ethanol Supply​

New Delhi, March 24: The Indian government is preparing to reduce the proportion of broken rice distributed through the Public Distribution System (PDS) from 25% to 10%, a move expected to free up nearly 90 lakh tonnes annually for ethanol production. The proposal was announced by Food Secretary Sanjeev Chopra at the All India Distillers' Association conference on Tuesday.

Stable Feedstock Supply for Ethanol Sector​

The proposed shift is aimed at ensuring a consistent and reliable supply of feedstock for the ethanol industry, reducing its dependence on whole grain stocks held by the Food Corporation of India. Chopra emphasized the importance of building resilient supply chains in the face of climate change.

He stated that providing a steady stream of broken rice would help maintain continuity in ethanol production while addressing past disruptions caused by fluctuations in crop output.

Changes in Grain Allocation Under PDS​

At present, grains distributed under the PDS include 25% broken rice for around 80 crore beneficiaries. Under the new plan, this share will be brought down to 10%, improving the quality of grains received by beneficiaries.

The surplus broken rice, drawn from the annual distribution of approximately 360 to 370 lakh tonnes of rice, will be auctioned to ethanol producers, animal feed manufacturers, and other users. A pilot project for this approach has already been conducted in five states.

Shift Away from Whole Grain Supply to Distilleries​

The government has also indicated that it will discontinue the supply of whole grain rice from FCI to distilleries starting next year. Broken rice from the restructured PDS system will instead become the primary grain-based feedstock for ethanol production.

This transition is expected to ease pressure on foodgrain stocks while providing the ethanol sector with a predictable, year-round supply.

Ethanol Blending Push Amid Rising Crude Prices​

The move comes against the backdrop of rising global crude oil prices. Brent crude has surged nearly 40% in recent weeks, increasing the urgency for India to strengthen its ethanol blending programme.

India has already achieved 20% ethanol blending in petrol, a significant rise from 1.5% in 2013. This has resulted in foreign exchange savings exceeding INR 1.63 lakh crore and reduced crude oil imports by 277 lakh metric tonnes since 2014.

Ethanol production capacity has also expanded sharply, growing from 420 crore litres in 2013-14 to nearly 2,000 crore litres currently, with substantial additions in recent years.

Focus Shifts to Expanding Demand​

With supply capacity improving, the government is now looking to expand demand. Measures under consideration include increasing the blending limit beyond 20%, introducing ethanol blending in diesel, and promoting flex-fuel vehicles.

Chopra noted that past supply constraints, particularly in 2023 due to lower sugar output and concerns over rice production, had prompted the need for a more stable feedstock strategy.

Industry Urged to Lift Allocated FCI Rice​

The Food Secretary also urged distilleries to expedite the lifting of existing FCI rice allocations. Out of 52 lakh tonnes earmarked for the current supply year, only 21 lakh tonnes have been utilized so far. Around 20 lakh tonnes remain available at discounted rates until June 30.

Maize and Alternative Feedstocks Gain Focus​

In addition to broken rice, maize is being actively promoted as an alternative feedstock, particularly rain-fed varieties that require less irrigation. Currently, around 40% of ethanol supply comes from grain-based sources, mainly maize.

Efforts are also underway to develop high-yield maize varieties capable of producing five to six tonnes per hectare, encouraging farmers to diversify beyond paddy cultivation.

Industry Calls for Policy Expansion​

At the event, industry representatives called for further policy support to expand biofuel adoption. AIDA President Vijendra Singh stated that the sector is ready to move beyond the current E20 target.

The industry has urged the government to gradually increase the ethanol blending mandate, introduce flex-fuel vehicles capable of running on 100% ethanol, promote ethanol-based cooking solutions, and explore blending ethanol with diesel.

Broader Biofuel Push Highlighted​

P S Ravi, Director at the Federation of Indian Petroleum Industry, outlined key areas for future growth, including biodiesel blending in diesel, ethanol as a cooking fuel, sustainable aviation fuel, and feedstock development.

The announcement signals a broader push by the government to strengthen India’s biofuel ecosystem while addressing energy security and agricultural sustainability challenges.