Govt to redirect 90 lakh tonnes of FCI broken rice to ethanol industry from next year: Food Secretary

New Delhi: Amid sharp rise in global crude oil prices, the Centre is planning to redirect 90 lakh tonnes of broken rice from the Food Corporation of India (FCI) to the ethanol industry starting next year.

The Ministry of Food will approach the Cabinet with a proposal to reduce the allocation of broken rice in grains distributed under the Public Distribution System (PDS) from 25 per cent to 10 per cent. This change is expected to free up roughly 90 lakh tonnes of broken rice annually for the ethanol sector, Food Secretary Sanjeev Chopra said on Tuesday.

India’s ethanol blending in petrol has already reached 20 per cent, up from just 1.5 per cent in 2013. This has helped the country save over Rs 1.63 lakh crore in foreign exchange and reduce crude oil imports by 277 lakh metric tonnes since 2014, Chopra said while addressing an event here.

The government is now looking beyond supply-side measures and focusing on increasing ethanol availability in the market. Raising the blending limit above 20 per cent, blending ethanol with diesel, and promoting flex-fuel vehicles are all being actively considered, with decisions expected soon.

“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 in this regard,” the Food Secretary said.

At present, broken rice constitutes 25 per cent of the grains distributed free of cost to around 80 crore people under the government’s food security scheme. 

Under the new plan, this share would be reduced to 10 per cent. The additional broken rice — from the total 360–370 lakh tonnes distributed every year — would be sold through auction to ethanol manufacturers, animal feed producers, and others. A trial run of the plan has already been completed in five states.

From next year, the government will stop supplying whole-grain rice from FCI stocks to distilleries. Instead, broken rice from the revamped food scheme will serve as a reliable, year-round feedstock for the ethanol industry, Chopra said.

Chopra also urged distilleries to speed up the lifting of the current FCI rice allocation. Out of the 52 lakh tonnes set aside this year, only 21 lakh tonnes have been picked up so far. Another 20 lakh tonnes are still available, but the discounted price offer expires on June 30.