- India’s ethanol programme is increasingly moving beyond sugarcane and molasses, with grain-based distilleries now playing a larger role in ethanol supply.
- Industry voices say grain-based ethanol can diversify feedstock, but it also raises questions about maize, animal feed, food processing and price pressure.
- Water and climate experts say India should assess ethanol through lifecycle water accounting, groundwater stress and food-security safeguards before moving beyond E20.
- Experts caution that Brazil’s ethanol model offers lessons, but India’s water stress, population pressure and food-security needs make direct replication difficult.
This is the third part in a series comparing India and Brazil’s ethanol transitions. This part examines how India’s ethanol model increasingly moving beyond sugarcane and molasses-based production to grains, raising questions about pressures on livestock feed and the food processing industry. The second part examined the challenges of procurement, storage, transport and quality control.
In December 2025, tractors and crowds of farmers gathered near an under-construction grain-based ethanol plant in Rathi Khera village in Rajasthan’s Hanumangarh district. They feared the project would strain local water resources, pollute groundwater and damage farmland. The company said the plant would use zero-liquid-discharge technology and pollution-control systems. The protest later escalated into clashes with police, and construction was halted.
The Hanumangarh agitation was one of several protests against ethanol and distillery projects reported across India, including in Madhya Pradesh, Punjab and Telangana, where communities have raised concerns about water use, pollution and impacts on farmland.
These disputes are emerging as India’s ethanol industry undergoes a major shift from sugarcane-based to grain-based production. In the latest tender by state oil companies, grain-based distilleries supplied more than 70% of the ethanol procured, according to Athar Shahab, managing director of Zuari Industries Limited, an Indian conglomerate with businesses spanning agribusiness, sugar and biofuels, real-estate and engineering services. A decade ago, sugarcane molasses dominated India’s ethanol supply. That balance has now shifted.
India now derives roughly 65-70% of its ethanol from grains, mainly maize and rice from Food Corporation of India warehouses, while sugarcane-based feedstocks contribute around 30–35%. Brazil, the world’s largest sugarcane producer, derives about 80% of its ethanol from sugarcane and the rest from maize.
The shift matters because maize, unlike sugarcane molasses, is also used by the poultry, animal-feed and food-processing industries. As ethanol demand grows, fuel producers increasingly compete with these sectors for the same grain.
Brazil, India’s most-cited reference point on ethanol, offers a different production model. Evandro Gussi, president of Brazil’s sugarcane industry association UNICA, said much of the country’s ethanol comes from sugarcane, grown mainly under natural rainfall rather than irrigation in the Centre-South region of the country. He said the crop’s expansion over recent decades has occurred largely over former pasture rather than through the direct clearing of native forests. Brazil also restricts the conversion of native vegetation through a federal legislation and uses satellite monitoring to track land-use change.
“It is now well established through a number of studies that, in the Indian context, first-generation ethanol faces important challenges related to water use, feedstock availability and long-term sustainability,” said Ramya Natarajan, a research scientist in the Climate, Environment and Sustainability programme at the Centre for Study of Science, Technology and Policy (CSTEP). “The strongest rationale for the programme is energy security and farmer income. However, as blending targets increase, it will be important to ensure that feedstock demand does not create unintended trade-offs with food and nutritional security.”
Fabio V. Scarpare, an assistant professor at Washington State University who studies sustainable bioenergy systems in Brazil, cautioned that Brazil’s conditions cannot be directly applied to India. He noted that Indian ethanol feedstocks depend more heavily on irrigation and groundwater, while the country’s water resources are already under pressure. He also said regulatory safeguards do not by themselves eliminate environmental risks, which depend on where crops expand, how water is sourced and how effectively rules are enforced.
A changing feedstock mix
According to Athar Shahab of Zuari Industries, the growing use of grain partly reduces dependence on sugarcane and addresses some concerns around the water intensity of sugarcane-based ethanol. It also creates a new policy challenge because maize is used by the poultry, animal-feed, starch-manufacturing and food-processing industries.
“The debate, therefore, should not be framed as food versus fuel. The real question is whether India can expand ethanol while simultaneously increasing agricultural productivity,” Shahab said.
He said that if maize is expected to support a larger share of India’s biofuel programme, policy must focus on higher yields, better seed technology, improved extension services, storage infrastructure and efficient procurement systems.
“Otherwise, pressure could emerge in feed markets and eventually be transmitted to consumers,” Shahab said.
The water and climate test
Anjal Prakash, faculty of public policy at FLAME University, said India’s ethanol expansion should not be assessed only through the lens of energy security or emissions reduction. Prakash works on water, climate adaptation and sustainability, and has written on water-security issues in South Asia.
India, he said, must judge crop-based ethanol “not just from an energy or emissions lens but from a water and climate resilience perspective.”
Prakash said any expansion of crop-based ethanol would require “integrated lifecycle water accounting, regional groundwater-stress screening, and strict limits on converting rain-fed foodlands or natural ecosystems.”
He said India should prioritise “ethanol produced from molasses and agricultural residues,” decentralised supply chains that include smallholders, and conditional incentives linked to water efficiency, micro-irrigation adoption and verified recharge commitments.
“Without these safeguards, ethanol policy will risk intensifying groundwater depletion and vulnerability among climate-stressed communities,” Prakash said.
Before India moves beyond E20, Prakash said the country should impose precautionary safeguards to protect water, food security and vulnerable communities. “We should impose national caps on irrigated-area shifts, exclude highly water-stressed basins from feedstock expansion, and prioritise molasses, residues, and waste feedstocks,” he said.
He added that “any grain-based ethanol must follow independent food security impact assessments.”
A new modelling research article published in PLOS One adds evidence to these concerns. The study led by Chandan Kumar Jha, a researcher at the Indian Institute of Management Ahmedabad (IIM-A), found that India’s ethanol policy involves serious trade-offs beyond oil-import reduction. It says all scenarios present challenges related to food security, food prices and resource competition, though the severity varies by feedstock mix.
Although molasses is a by-product of sugar production, the study says its environmental footprint remains closely tied to the land, water and fertiliser required to grow sugarcane. Sugarcane-based ethanol performs better in the model, requiring less water and fertiliser and generating lower greenhouse gas emissions, but it does not eliminate food-security and resource-competition concerns.
The study examines India’s 20% ethanol blending mandate using MAgPIE, a global land-use and agricultural production model. It evaluates different ethanol feedstock scenarios involving molasses and sugarcane juice and assesses their implications for land use, water and fertiliser use, food prices, trade and greenhouse gas emissions.
The study estimates that, compared to the present scenario, water consumption rises by 21-118% in 2030 and 49-138% in 2050 across the ethanol scenarios it models. It also projects a sharp rise in fertiliser use in high-molasses pathways, with associated nitrogen surplus and emissions. The researchers compare different ethanol expansion scenarios against the present scenario as the baseline to estimate the additional impacts on water use, fertiliser demand, land use and emissions.
The authors conclude that India’s biofuel roadmap will need careful management of feedstock choices, fertiliser use, irrigation efficiency, trade and the timing of diversified and second-generation feedstocks if ethanol expansion is to align with food security and long-term resource sustainability.
Food security or fuel security?
Agriculture policy analyst Devinder Sharma takes a sharper view of the ethanol debate. Sharma has written for decades on agriculture, food security and farm policy, and argues that India’s ethanol policy cannot be separated from its responsibility to feed people.
“Brazil is a big country with a small population. India is also a big country, but India’s population is huge. What is the rush? Why is there such a crisis?” Sharma said.
Sharma said India should be cautious while drawing lessons from Brazil because the two countries have different population pressures, water realities and food-security needs.
Sharma argued that diverting sugar and other food crops towards ethanol could create tensions between fuel production and food security. He said the policy should be assessed not only in terms of energy security, but also for its potential effects on food availability, agricultural resources and water use.
Sharma also questioned the framing of farmers as energy providers instead of food providers. “The country should be focusing on ensuring food security to feed its people,” he said. “Instead, we are very happily and merrily trying to divert our resources to feeding the cars. If we start feeding cars, how do we feed our people?”
He said water use should be central to the ethanol debate, especially in a country where irrigated crops already place pressure on groundwater. “Sugarcane itself is detrimental to India’s food security because of water consumption,” Sharma said.
Brazil’s experience and its limits
Brazil is often cited as a model for ethanol because it has built a large ethanol economy over several decades. Its experience includes sugarcane ethanol, flex-fuel vehicles, a mature distribution system and a market where consumers can choose between ethanol and gasoline depending on price and availability.
UNICA’s Gussi defended Brazil’s current sugarcane ethanol model saying, “One hundred percent of sugarcane plantations replaced degraded pasture in Brazil,” he said.
Gussi also said Brazil’s system is strict on deforestation. “If you deforest even illegal deforestation, one hectare, all the farm is out of the game,” he said.
He pointed to Brazil’s second-crop system as another reason why Brazil’s ethanol pathway differs from countries where crop expansion may compete more directly with food or water needs. “In Brazil, we are able to produce twice, sometimes three times in the same land in the same year,” he said.
“One hundred percent of our corn ethanol comes from this second harvest,” Gussi said.
But experts caution that Brazil’s experience cannot be copied without considering local hydrology, farm structure and land-use governance.
Scarpare of Washington State University, said Brazil’s ethanol sustainability cannot be judged only at the pump or the distillery gate.
“In Brazil, sugarcane ethanol can be relatively efficient when productivity is high, when much of the crop is rainfed, and when land-use expansion is governed. But Brazil also shows that sustainability cannot be judged only at the fuel pump or distillery gate,” Scarpare said.
Scarpare said the argument that Brazilian sugarcane expanded largely over pasture or previously cleared land is partly true, but incomplete. “Brazil’s ethanol story is not primarily an Amazon-deforestation story, but it is still a land-use governance story,” he said.
“The key question is not only what land did sugarcane directly replace? But also what activities were displaced, where did they move, and how were water, soil, and biodiversity affected?” Scarpare said.
On water, Scarpare said Brazil’s traditional sugarcane regions are largely rainfed, which helps explain why Brazilian cane ethanol often has a lower blue-water footprint than irrigated sugarcane systems elsewhere. But he cautioned that national averages can hide regional differences.
“Sugarcane is not automatically water-unsustainable, but ethanol expansion can become problematic when it increases consumptive water use in basins that are already seasonally stressed,” he said.
Scarpare said distillery water use is only one part of the ethanol water story. For sugarcane ethanol, he said, the dominant water burden is usually in the field: crop evapotranspiration, irrigation withdrawals, runoff, leaching and pollution-related grey water.
This is where Brazil and India diverge. Scarpare said India’s feedstock production often depends much more on irrigation and groundwater than Brazil’s rainfed sugarcane regions.
“India should be careful not to treat ethanol scaling only as a fuel-substitution policy. It is also a land, water, crop-choice, and food-security policy,” Scarpare said.
A warning from other biofuel pathways
The land-use concern is not limited to India or Brazil. As countries look to biofuels for energy security and lower-carbon transport, environmental groups warn that feedstock expansion can carry risks for forests, land rights and indigenous communities if safeguards are weak.
Mighty Earth, a global environmental advocacy organisation working on forests, climate and community rights, has warned that biofuel expansion can carry land-use and Indigenous-rights risks when feedstock production is not tightly regulated.
The organisation has pointed to Indonesia, where renewable energy and biofuel expansion has raised concerns around sugarcane, palm oil, forest conversion and customary land rights in Papua.
The Indonesia example is not a direct parallel to India’s ethanol pathway. But it shows that biofuels cannot be judged only by what they replace in a vehicle tank. Feedstock choice, land rights, forest protection, water use and community consent shape whether a fuel transition reduces environmental harm or shifts it elsewhere.
Lesson, not shortcut
Luiz Augusto Horta Nogueira, a Brazilian bioenergy expert and former director at Brazil’s oil agency, said ethanol remains an important fuel because it is produced from a renewable carbon cycle.
But Horta also cautioned that biofuel expansion should not override food and water priorities. “The opportunity to produce fuel should [not] overcome other more crucial and important questions, which is food production, which is the protection of water resources,” he said.
Scarpare made a similar point about India’s choices. “If higher ethanol demand encourages more irrigated sugarcane in already stressed basins, the climate benefit at the tailpipe could be offset by water depletion, energy use for pumping, fertiliser losses, and food/feed competition,” he said.
Banner image: A sugarcane field in Narsinghpur, Madhya Pradesh. Image by Manish Chandra Mishra/Mongabay.
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