India, April 23 -- The Union government is finalising a sweeping overhaul of regulations for the sugar sector, expanding the framework to cover ethanol production, devolving more powers to states, and revising long-standing rules governing mill operations in the world's second-largest sugar producer.

The food ministry's draft Sugarcane (Control) Order, 2026 proposes increasing the mandatory distance between two mills, known as the command area, from 15 km to 25 km. The rule is aimed at preventing mills from sourcing cane outside designated zones and competing for farmers' produce.

While Maharashtra, Punjab and Haryana already follow the 25-km norm, major producers such as Uttar Pradesh and Karnataka currently do not. The change has been...