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Shifting India’s sugar industry from food to biofuels

August 2020: Shifting the use and production of sugar in India from food to feedstock for biofuels could decrease rising numbers of micronutrient deficiencies in India and incentivise the cultivation of more nutritious crops. It could further reduce pressure on India’s natural resources and support the decarbonisation of India’s transport sector.

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India is the world’s second largest producer of sugar and India’s sugar industry enjoys large political patronage since the 1950s. In the wake of the Bengal famine in 1943, the government expanded the sugar industry to provide its population with subsidized sugar to cover people’s daily calory intake. However, cultivating sugarcane requires large amounts of water and land which has challenged the country’s natural resources. For example, in 2010-11 sugarcane occupied only 4% of Maharashtra’s agricultural land but used 61% of the state’s irrigation water with other nutritious food crops remaining lower than national average. It also reduced river flow by 50% over that period. Looking at the connection of food, water, and energy in India through the lens of the political economy, new evidence suggests that shifting the primary use of sugarcane from food to ethanol for energy use could decrease nutritional dependence on sugar and increase energy independence. It draws from figures showing that cultivating sugarcane for ethanol is commercially more viable than selling sugar intended for human consumption. This leads to the assumption that stakeholders in the Indian sugar industry could achieve higher returns on their investment through ethanol production and reduce the land needed to cultivate sugar. It comes at a time as the Indian government announced its goals to increase ethanol-to-gasoline blending rates from 6 to 20% by 2030 to help decarbonise its transport sector. Analogous to the corn industry in the US, effects on human health and the environment will depend on promoting either juice from crushed sugar cane or molasses, a by-product from sugar processing, as bio feedstock for ethanol, and on policies encouraging a reduction of land use for sugar cane production paired with the planting of more nutritious crops.

Implications and opportunities

Using molasses as feedstock to meet India’s ethanol production target would require the dedication of additional water and land resources to sugar. In contrast, policies promoting the use of ethanol from sugarcane juice could make India’s water and energy resources more sustainable. Sugar cane juice has a higher conversion rate for ethanol compared to molasses, however, once juice from crushed sugar cane is used for ethanol, it does not allow for further production of sugar. Conversely, molasses is a bye-product from sugar processing and would allow for the simultaneous production of sugar for human consumption and ethanol at the expense of increased land use and irrigation for sugarcane cultivation. Using sugarcane juice for ethanol could reduce the amount of land needed to cultivate sugar which, in turn, could be converted to agricultural land for more nutritious crops. Increasing the availability of nutritious food crops in India, could reduce the need for food imports to meet rising food demand in India and help alleviate pressures on the global food system. Further, using juice could allow for reduced government spending on subsidizing sugar and selling it below cost in its public distribution system. Replacing sugar with more nutrient rich foods could reduce micronutrient deficiencies in India which have been shown to reduce cognitive growth, physical well-being, and are linked to increasing numbers of obesity and diabetes which are negatively impacting the country’s public health system. Considering increasing weather and rain variability due to climate change, India’s agricultural system is particularly susceptible to floods and droughts. Shifting priorities in crop cultivation could support building resilience and improve water and land management systems in addition to improved food and energy systems.

Limitations

The above promotes the use of sugarcane for bioethanol to decarbonise India’s transport sector and improve nutritional intake, but acknowledges other challenges arising from using biofuels in the transport sector. The results should be seen within the context of India’s political economy and geographic context.


Sources

Lee, J., Y., et.al. (2020). Water-food-energy challenges in India: political economy of the sugar industry. Environmental Research Letters, 15 (8).

Kashmir Times, (2020). Sustainability of Indian sugar industry, with ethanol production. Retrieved from http://www.kashmirtimes.com/newsdet.aspx?q=104216

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The views expressed in these external research papers are those of the authors and do not represent an official position of CISL, the University of Cambridge, or any of its individual business partners or clients.