On October 16, oil marketing companies issued their ethanol procurement tender for the 2026–27 supply year, setting zero sugar diversion for ethanol made from sugarcane juice, sugar syrup and B-heavy molasses. But what does this decision mean for India's ethanol-blending programme? In this video, we explain why the government is prioritising domestic sugar availability, how the new tender changes procurement, and why the distinction between different types of molasses matters. Importantly, this is a restriction on procurement under the new tender, not a blanket ban on all sugarcane-based ethanol production. Ethanol made from C-heavy molasses remains eligible. We also look at the alternatives. Oil marketing companies are seeking bids for around 11 billion litres of ethanol, with greater emphasis on feedstocks such as maize, broken rice and surplus rice held by the Food Corporation of India. The policy raises a larger question: can India protect sugar supplies without slowing its efforts to reduce oil imports? The impact on sugar prices, ethanol production and fuel blending remains to be seen.