Union Minister for Road Transport & Highways, Nitin Gadkari

Pointing out that sugar alone is not viable since its prices is determined in Brazil, Road Transport Minister Nitin Gadkari on Tuesday asked cooperative mills to focus on byproducts for the energy sector where there are unlimited opportunities. He said that using bagasse for cogen power at current rate is not viable as the fibrous residue of sugarcane could be better utilised to produce CBG, which the government has committed to buy at a remunerative price.

Addressing the annual award event of National Federation of Cooperative Sugar Factories (NFCSF) in New Delhi on Tuesday, Gadkari appealed to the industry to focus on recovery improvement as 1 per cent additional recovery would translate into additional between Rs 50,000 crore and Rs 60,000 crore in a year.

“If there will be economic viability through these byproducts, you (mills) will be able to pay Rs 600/quintal to sugarcane farmers,” he said appealing the cooperative leaders to expand into developing more and more byproducts from sugarcane.

The minister told the audience that Toyota Motors has requested him to launch its first Innova flex fuel SUV in October, which will run on 100 per cent ethanol and also generate electricity, again to be utilised in running the vehicle, lowering the cost.

He also asked the leaders of NFCSF to realise that the entire system is urban-centric as a small increase in prices of agriculture produce is highlighted by media as a major issue whereas they ignore when farmers throw their onion or tomato on the roads on prices drop below Re 1/Kg.

“Right now, when the price of onions drops to 50 paise, farmers throw their produce away. Yet, there is no news coverage about it on TV—hardly any reports on how many people discarded their tomatoes or onions. But when the price hits ₹50 per kg, our politicians go around wearing protest garlands. All day long, the refrain is onions have become expensive. This is because the entire system is urban-centric,” he said.

Gadkari suggested that to break free from this situation, the first step is to utilise technology. Citing example of Brazil and its large land holdings -- a single farm spans over 2,000-3,000 acres, he said production cost for sugar there comes to ₹23 per kg, whereas in India at least ₹33–34 per kg.

“That is why, if Brazil has a sugar surplus, prices in India drop. Conversely, if Brazil faces a shortage, prices here rise. And why do they rise? Not because of our factories, but because of the situation in Brazil. After all, Brazil is the world’s largest exporter of sugar,” he said.

On reviving closed sugar mills, Gadkari said it is time to continue growing sugarcane and develop projects to convert sugarcane juice directly into ethanol. At the same time he advised - “do not produce sugar.” He also blamed the recent price rise was due to a shortage. Stating that India needs 280-300 lakh tonnes (lt) of sugar per year, against production between 300 lt and 350 lt. “Naturally, having surplus production kept prices stable, even while costs elsewhere were rising,” he said.

Gadkari also warned: “You cannot sustain operations by relying solely on sugar. You must venture into by-products. Regarding by-products, various new technologies have emerged, and I intend to discuss the government schemes concerning them.”

The minister explained the government’s initiatives on aiming to convert 220 lt of paddy straw in Punjab and Haryana to compressed biogas (CBG). He also said the government is promoting to make CBG from bamboo, bagasse and Napier grass. Out of 1,908 CBG plants registered so far, 132 are operational, and 340 are under construction. The capacity of the operational plants is 900-1,000 TPD (tonnes per day).

Published on September 22, 2026