In the middle of the COVID-19 pandemic and a country-wide lockdown came an announcement that was difficult to believe. The press release said the National Biofuel Coordination Committee (NBCC) chaired by the Union Minister of Petroleum and Natural Gas has decided to use “surplus” rice available with the Food Corporation of India (FCI) for conversion to ethanol. This is ostensibly for making alcohol-based hand-sanitisers and for the blending of ethanol with petrol. This decision is not only audacious but also an affront to the millions of people who are deeply affected by food insecurity.
The images of exhausted migrants with their families trudging back from cities to villages are still vivid. Some have died on the way for the want of food and water. Distribution of food rations and cooked food is still far from adequate. The urgent priority is to transfer grain from godowns to ration shops and NGOs helping in food packet distribution — certainly not diverting rice to ethanol producers.
Policymakers in India have been acutely aware of the dangers of diverting grain for biofuel production. In 2009, the National Policy on Biofuels stressed on the use of non-food resources to avoid a possible conflict between food and fuel. Contrast this with the thoughtless path taken by the US. In 2007-8, about 25 per cent of the corn produced in the US was used for biofuel production. In addition to cereals, oilseed crops like rapeseed, soyabean and sunflower were used for biofuel production. In 2018-19, an astounding 37.6 per cent of the corn produced in the US was used for making ethanol.
Such diversion of food crops to produce biofuel was considered one of the reasons for the rise in food prices globally. Corn and other grain is also used in feedstock for poultry and cattle and is hence part of the food economy. Should India, a country with rampant poverty, hunger, and malnutrition, use food grains for making ethanol? This at a time when India’s position in the Global Hunger Index has slipped nine places. India was placed 102 among the 117 countries ranked in the index in 2019. The National Family Health Survey (NFHS-4) 2015-16, found that 38.4 per cent of children under five years are “stunted” (height for age), and 21 per cent are “wasted” (low weight for height). In fact, over a period of 10 years, wasting has increased from 19.8 per cent in NFHS-3 to 21 per cent in NFHS-4.
In 2018, the government modified its 2009 policy. The new National Policy on Biofuels had a target of 20 per cent blending of ethanol in petrol and 5 per cent blending of biodiesel in diesel by 2030. This was to be achieved by increasing production using second generation bio-refineries and developing new feedstock for biofuels. It allowed the production of ethanol from damaged food grains like wheat and broken rice, which are unfit for human consumption.
More worryingly, the new policy allowed the use of excess food grain for ethanol in a bounty crop year, so long as the surplus is endorsed by the Union Ministry of Agriculture. The approval for this is to be given by the National Biofuel Coordination Committee, chaired by the Union Minister Petroleum and Natural Gas. It includes representatives from 14 other central departments.
It is not known if the departments of agriculture and food and public distribution have projected that there will be an excess supply of rice in 2020-21. The quantity of rice from which ethanol will be produced has not been announced, nor do we know the price at which such rice will be sold by the FCI. About 85 per cent of rice is kharif crop, heavily dependent on monsoon. Despite the prediction of a normal monsoon, public interest demands that the basis for the projection of surplus of rice is disclosed. What happens if the monsoon projections go wrong? Will we have to import grain?
In the past, damaged grain, unfit for human consumption, has been sold by the FCI for cattle feed. Despite the commonly held belief of a lakh of tonnes of rotting grains, the FCI’s storage practices are actually quite good — damaged grains as a percentage of total quantity issued by the FCI has been just about 0.01 per cent to 0.04 per cent in the last five years. On March 1, the FCI had just 984 tonnes of non-issuable rice and 20 tonnes of non-issuable wheat — hardly any ethanol can be made from such a small amount of damaged grains.
Therefore, it seems that the NBCC has decided to use sound quality rice, within FSSAI specifications, for ethanol. It is a bad policy in normal times and particularly unethical during a pandemic. It potentially deprives food to humans as well as livestock. At a time when there are fears of a steep fall in national income, a rise in unemployment, and an increase in food inflation due to supply bottlenecks, it is imperative that food security and food price stability be given the highest priority.
Ethanol can be produced from other ingredients such as B and C heavy molasses, sugar, sugar syrup, and sugarcane juice. Ethanol has also been blessed with a low GST and enjoys relaxed conditions for inter-state movement if used for blending with petrol. Since the economy faces a bleak prospect due to the impact of COVID-19, the government should first use the food grains to meet the requirement of about 10 to 20 crore people without ration cards. It must provide rice to NGOs at PDS prices, for providing cooked food to migrant labour stuck in cities and it should provide an additional five kg food grains to the poor for six months instead of three months.
If the Centre still thinks that the country will still have surplus rice, it must facilitate export to friendly countries which are suffering an adverse impact of COVID-19 on their economies.
The article was first published in the Indian Express Print under the title ‘Not at the cost of food security’ on May 6, 2020. Hussain is Senior Visiting Fellow, ICRIER. Ranade is Senior Fellow at the Takshashila Institution
📣 The Indian Express is now on Telegram. Click here to join our channel (@indianexpress) and stay updated with the latest headlines