A sugar shortage and a price surge of ₹20 in just 17 days — that is the charge AAP convenor Arvind Kejriwal levelled at the Modi government on Thursday, 20 August 2026, in a pointed broadside that frames a flagship energy policy as a self-inflicted economic wound.

Kejriwal's post, mixing sharp Hindi with economic shorthand, asked bluntly: 'ये सरकार है या मज़ाक?' ('Is this a government or a joke?'). The argument is causally tight: the government diverted sugarcane to produce ethanol — burning foreign exchange on biofuel — only to now import sugar and burn that same foreign exchange anyway, but at a higher cost and with consumers already stung at the retail counter.

The ethanol gamble and where it went wrong, per Kejriwal

The Ethanol Blended Petrol Programme, accelerated after 2014, was designed to cut India's crude oil import bill by substituting petroleum with domestically produced ethanol. The National Policy on Biofuels, 2018, set a target of 20 percent ethanol blending by 2030, and a 2022 amendment permitted the direct use of sugarcane juice — not just molasses — as feedstock, significantly increasing the sugarcane diverted away from sugar production.

Kejriwal's critique targets precisely this trade-off. By pulling more sugarcane into ethanol pipelines, the government squeezed domestic sugar supply. The result, he claims: a shortage severe enough to force sugar imports — the very foreign exchange outflow the programme was meant to prevent.

Who bears the cost — and who was supposed to benefit

The biofuel policy was built on two pillars: energy security and farmer welfare, offering sugarcane growers a guaranteed offtake market through ethanol procurement. But if the downstream consequence is a domestic sugar crunch, it is urban and rural consumers who absorb the price shock at the kirana store, even as the foreign exchange arithmetic the policy promised to improve goes into reverse.

Opposition parties have repeatedly drawn this line between biofuel diversion and retail commodity prices. Kejriwal's post sharpens that argument into a single, caustic loop: spend forex to save forex, end up spending more forex, and make sugar unaffordable in between.

What the government has not yet said

The food ministry has not publicly adjusted ethanol procurement targets or announced import duty changes in response to the claimed shortage. The next official sugar stock and production data release will be the clearest test of whether Kejriwal's numbers hold — or whether the government can rebut them with supply figures of its own.

Until then, the ₹20 figure hangs in the political air: specific, retail, and impossible to ignore at the checkout counter.