The current spurt in food prices has snowballed into a global food crisis, which stems from multiple reasons like depletion in food stocks, rise in crude oil prices, climate change etc. The consequences of food prices have a cascading impact on the economy fuelling inflation besides restraining MDG goals and political turmoil. Along with the rise in food prices, the fuel prices have skyrocketed crossing all limits, from 2002 it has increased six times and is expected to scale further. The rising cost of inputs linked to the increase in oil prices is another important factor adding to the farmers' woes. The current policy brief tries to explore some critical factors linking food prices, biofuels and international trade.

It is clearly evident that the modern food system is dependent on crude oil and with energy shortage and environment concerns boiling high there is a strong urge to reduce the escalating crude oil prices by growing biofuels, which is ushering a new era of green revolution, a new development paradigm and a solution to the twin problems of poverty and climate change. However, biofuel can bring clear shift in food economics if the profit in fuel crops rule higher than growing food crops. Keeping these sensitivities, India's biodiesel policies are still under suspension and current brief tries to bring to fore development impacts of biofuels in the context of trade and food prices.