The diversion of sugarcane and foodgrains for ethanol production is driving food prices higher, the Congress said on Friday (August 21, 2026), adding that vehicles not designed for 20% ethanol-blended fuel face mileage and compatibility problems.
The Aam Aadmi Party too claimed that diverting sugarcane towards ethanol production has reduced sugar output, pushing sugar prices up by ₹20 per kg in just 17 days.
The NDA government at the Centre had, on Thursday, allowed duty-free imports of 10 lakh tonnes of raw sugar under a Tariff Rate Quota (TRQ) till October 31, amid the rising prices of the sweetener in local markets.
The move is aimed at enhancing domestic availability and capping price rise.
Congress seeks review of E20 policy, non-ethanol petrol options In a post on X, Congress communications chief Jairam Ramesh demanded an immediate review of the E20 policy and sought the provision of non-ethanol petrol options.
Vehicle and kitchen costs hit “The people are paying the price for both expensive food and expensive travel because of the wrong decisions of the arrogant Modi government,” Mr.
Ramesh said, adding that “a fuel policy under which both the vehicle and the kitchen become expensive” could not be acceptable to the country.
According to the figures cited by Mr.
Ramesh, sugar prices have risen from ₹48 to ₹67 a kg and jaggery prices from ₹50 to ₹65 a kg over the past three months.
Rice and maize flour, he said, have become costlier by 16% and 11%, respectively, while animal feed prices have risen 10.34%.
The Congress leader also asked why there was no cut in petrol prices despite a decline in international crude oil prices and lower costs resulting from 20% ethanol blending.
He alleged that alternatives to petrol had been limited to benefit ethanol producers, while serious questions remained over the impact of E20 blended petrol on vehicle mileage and compatibility.
Government allows duty-free import of 10 lakh tonnes of raw sugar until October 31 Compromising food security Congress Rajya Sabha MP Syed Naseer Hussain said the Modi government’s aggressive push for E20 was compromising India’s food security.
“As more sugarcane is diverted towards ethanol, domestic sugar prices have surged nearly 20% in August to a record ₹5,350 per 100 kg.
India is now considering importing sugar for the first time in nearly a decade to meet domestic demand during the festival season,” he said in a post on X.
AAP convener Arvind Kejriwal said in a video message that the government started making ethanol from sugarcane in order to save foreign exchange spent on oil imports.
“Now, they will import sugar using that foreign exchange,” he said.
“It’s a government entirely run by illiterates.
No one knows what will happen if they do something,” he added.
