Uttar Pradesh (UP), which is India’s top sugarcane and ethanol producer, is attracting investments in the downstream supply chain including distilleries.
Ethanol is a sugar byproduct, and has multiple industrial and chemical sector applications including blending with fossil fuels, alcohol, medicines etc.
Distilleries refine ethanol, which is produced from sugarcane molasses, for various industrial uses such as making medicines and liquor.
Currently, UP has private investment pipeline of over ₹1,000 crore pertaining to leading distillers including United Breweries, Allied Blenders and Distillers (ABD) etc.
United Breweries is setting up a manufacturing unit in Unnao district of Central UP, while Mount Everest Breweries is establishing a unit in Hardoi, according to senior officials.
Similarly, Woodpecker Greenagri Nutrients has commissioned a unit in Farrukhabad district.
Meanwhile, ABD is investing ₹600 crore to strengthen its manufacturing footprint in the state including a greenfield distillery planned for commissioning in the next 24 months.
“Uttar Pradesh has a progressive excise policy, supported by a conducive business environment for long-term investment. These excise-friendly policies have contributed to a significant growth in the market potential,” ABD Managing Director Amar Sinha said.
ABD’s Moradabad bottling unit is expected to become operational in the coming months itself.
Compared to UP ethanol output of 1.8 billion litres in 2023-24, the corresponding figure in the 2024-25 season topped 2.23 billion litres, a hike of 23 per cent year-on-year .
Meanwhile, UP has recorded more than 45 per cent jump in excise exports in the first quarter of the current financial 2026-27.
UP excise exports during April-June 2026 were valued at $12.78 million vis-a-vis $8.79 million in the corresponding period last financial year.
The state’s share in national excise exports jumped from 10.2 per cent to 12.6 per cent — placing the state third behind Maharashtra and Punjab.
UP Excise Minister Nitin Agarwal said UP’s progressive three-year Excise Export Policy 2026-29 is also helping to boost the sugarcane value chain from sugarcane and molasses to processing, packaging, storage and transportation.
Between April and July 2026, UP distillers supplied 16.4 million additional bottles to other states, a 45.7 per cent increase over the corresponding period of Apr-July 2025.
The excise sector growth is vital for an agrarian economy like UP, with the cash crop of sugarcane supporting almost 5 million farmers’ households. It is also catalysing the downstream food processing supply chain.
