Sugar and Egg Prices Skyrocket Amid Rice Diversion for E20 Programme
India's E20 ethanol blending programme has led to an unexpected consequence: surging sugar and egg prices. The programme, which aims to blend 20% ethanol with petrol by 2025, has caused a diversion of subsidised rice meant for the poor to distilleries. This rice is being used as feedstock for ethanol production.
The use of millets (corn) and even rice as feedstocks has changed from molasses and rotten rice earlier. The government's subsidy on rice is benefiting the distilleries, while the common man is paying a higher price for sugar and eggs due to the diversion.
The E20 programme was launched with an aim to reduce dependence on imports and promote ethanol production in India. However, critics argue that it is not sustainable and will ultimately fall on taxpayers' shoulders.