New Delhi: The Indian sugar industry is looking beyond sugar and ethanol, with green hydrogen, sustainable aviation fuel (SAF), green methanol and compressed biogas (CBG) emerging as the next major growth opportunities for the sector, speakers said at the ISMA Indian Sugar & Bio-Energy Conference 2026 in New Delhi.
Speaking at the inaugural session of the India Sugar & Bio-Energy Conference 2026 organised by the Indian Sugar & Bio-energy Manufacturers Association (ISMA), Santosh Kumar Sarangi, Secretary, Ministry of New and Renewable Energy (MNRE) said the sector had transformed from a traditional sugar producer into a diversified bio-refining industry capable of contributing significantly to India’s clean energy transition.
“Today, you have completed a journey where from merely being sugar producers, you have become bio-refiners,” Sarangi said, highlighting the growing contribution of sugar mills through ethanol production, distilleries, bagasse-based power generation and other bioenergy activities.
He said the sugar industry could play a larger role in India’s energy security by expanding into new energy products. Investments in green hydrogen under the National Green Hydrogen Mission, along with green methanol, SAF and other biofuels, could open new avenues for sugar companies.
The industry also has significant potential in supporting the growth of flex-fuel vehicles, both two-wheelers and four-wheelers, by supplying ethanol and other renewable fuels, he said.
From sugar producer to bio-refiner
Sarangi recalled that when he was associated with a sugar plant in Odisha in the late 1990s, mills faced major challenges in finding productive uses for by-products such as bagasse, press mud and spent wash. The situation has changed significantly with technological development and policy support.
He credited scientists, farmers and industry for improvements in sugarcane varieties and cultivation practices that have helped increase sugar recovery and improve the financial position of the sector.
According to Sarangi, technological innovation and greater investment in research and development will be critical for the next phase of the industry’s transformation.
Bagasse, CBG offer new opportunities
The MNRE Secretary also highlighted ongoing efforts to develop technologies for converting sugar industry residues into energy. The National Institute of Bioenergy (NIBE), Kapurthala, is working with ISMA on technological interventions for producing biogas from bagasse.
He also pointed to the opportunities created by the GOBARdhan scheme, which provides support for CBG projects through capital assistance, offtake arrangements and pricing mechanisms.
Sarangi said the recent geopolitical situation had reinforced the importance of energy security for countries such as India. Greater domestic production of renewable fuels and energy could reduce dependence on imported fossil fuels and strengthen the country’s self-reliance.
ISMA calls sugarcane a strategic energy crop
In his inaugural address, ISMA President Niraj Shirgaokar said policy support and technological modernisation had fundamentally changed the role of the Indian sugar industry.
He said sugarcane should increasingly be viewed as a strategic energy crop, with ethanol blending helping mills diversify their operations while contributing to lower fossil fuel imports and emissions.
Shirgaokar called for faster adoption of high-ethanol blends, flex-fuel technology and CBG in collaboration with automobile manufacturers and oil marketing companies.
He also stressed the importance of strengthening the agricultural foundation of the sector through precision farming, satellite-based crop monitoring and artificial intelligence. These technologies, he said, could provide farmers with timely advisories and improve yield forecasting.
A whitepaper titled “From Cane to Cloud: The Next Era of AI-Powered Sugar Manufacturing”, prepared by PwC, was also unveiled at the event. The report focuses on the growing role of artificial intelligence and digital technologies in transforming sugar manufacturing and improving operational efficiency.
The two-day conference, held under the theme “Powering India’s Energy Security,” brings together policymakers, scientists, industry leaders, researchers and international delegates to discuss the future of sugar, bioenergy and emerging clean-fuel opportunities.
