NEW DELHI: The government has approved a nearly 25% hike in the price of ethanol, a byproduct of sugarcane used for blending petrol, a step aimed at shedding surplus sugar out and lowering the quantum of total oil imports, one of the main macroeconomic risks due to rising fuel prices. The decision was announced by petroleum minister Dharmendra Pradhan, after the Cabinet’s approval Wednesday. The government expects two main benefits. Sugar mills battling losses from surpluses will be better equipped to clear payments due to cane farmers, worth over Rs13,000 crore. Of this, mills in politically significant Uttar Pradesh owe nearly Rs.10,000 crore.