India, Aug. 23 -- India's ambitious biofuels programme is at a crossroads, not least because the country's chief economic adviser, V Anantha Nageswaran, in a recent newspaper article, cautioned against moving to higher ethanol blends without proper assessments and even advocated bringing back the lower E10 blend for older vehicles. His warning is remarkable because it is rare for government economists to air views that don't explicitly agree with current policy. In the public's imagination, the issue still is largely about the "corrosive" effects of E20 petrol on vehicles not equipped to handle the fuel blend. The real issue is much deeper, one tied to food security and sustainability in the world's most populous nation.

Ethanol blending...