India's E20 Ethanol Policy: A Critical Scrutiny of its Economic and Environmental Impacts
UPSC Relevance
Prelims: Indian Economy (Energy Security, Agriculture - Cropping Patterns, FRP), Environment & Ecology (Biofuels, National Policy on Biofuels, Groundwater Depletion), Science & Technology (Electric Vehicles, Rare Earth Elements).
Mains: GS Paper 3 (Infrastructure: Energy; Indian Economy; Food security; Conservation, environmental pollution and degradation; Major crops-cropping patterns); GS Paper 2 (Government policies and interventions, International trade issues).
Key Highlights from the News
Key Policy: India achieved its goal of E20 (20% ethanol blending) in petrol. The government's stated objectives are to reduce oil imports, increase farmers' income, and reduce pollution.
Impact on Consumers: Vehicle owners are concerned about reduced mileage and increased maintenance costs. Consumers are not receiving a proportional reduction in fuel prices.
Impact on Agricultural Sector:
This policy primarily relies on sugarcane. As it is a water-intensive crop, it causes groundwater depletion in states like Maharashtra.
The Food vs. Fuel debate intensifies. Using food grains like corn for ethanol has led to an increase in India's corn imports.
Incompatibility with the Shift to Electric Vehicles:
Overemphasis on ethanol may slow down the transition to more sustainable Electric Vehicles (EVs).
Challenge in the EV Sector: India's EV goals face a major challenge due to reliance on China for critical Rare Earth Elements (REEs).
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