Government Initiatives to Boost Ethanol Blending Beyond 20%

21 Mar 2025 CW Team

Steady Progress in Ethanol Blending The Public Sector Oil Marketing Companies (OMCs) surpassed the 10% ethanol blending target in June 2022, five months ahead of schedule. Ethanol blending has steadily increased over the years: 12.06% in ESY 2022-23 14.60% in ESY 2023-24 17.98% in ESY 2024-25 (as of 28th February 2025). As of now, no decision has been taken to increase ethanol blending beyond 20%.

Impact of E20 on Vehicle Performance According to the Roadmap for Ethanol Blending in India (2020-25), using E20 fuel leads to a marginal reduction in fuel efficiency for vehicles originally designed for E10 fuel. However, the Society of Indian Automobile Manufacturers (SIAM) has noted that engine modifications can mitigate this efficiency loss. Testing has shown no major issues with engine performance, component wear, or oil degradation when using E20 fuel.

Expanding Feedstock for Ethanol Production The National Biofuel Coordination Committee permits the use of surplus food grains for ethanol production. Key feedstock sources include:

Sugarcane derivatives: Molasses, sugarcane juice Food grains: Maize, broken rice, surplus grains Agricultural residues: Rice straw, cotton stalk, bagasse, corn cobs, sawdust The utilisation of specific feedstocks is calibrated annually based on availability, cost, market demand, and policy incentives.

Government Measures to Promote Ethanol Production: Since 2014, the government has implemented several initiatives to scale up ethanol production under the Ethanol Blended Petrol (EBP) Programme: Expansion of feedstock sources for ethanol production. Administered pricing mechanism for ethanol procurement. Reduction of GST on ethanol to 5% under the EBP Programme. Eased interstate and intrastate ethanol movement through amendments to the Industries (Development and Regulation) Act. Simplified procurement process by OMCs. Advancement of the 20% ethanol blending target from 2030 to ESY 2025-26. Introduction of Ethanol Interest Subvention Schemes (EISS) (2018-22) to promote ethanol production from both molasses and grains. Long-Term Offtake Agreements (LTOAs) between OMCs and Dedicated Ethanol Plants (DEPs).

These measures are designed to encourage ethanol producers and farmers while ensuring a sustainable transition to higher ethanol blending levels in India's fuel mix.

This update was provided by Minister of State for Petroleum and Natural Gas, Shri Suresh Gopi, in a written response to the Lok Sabha today.

The Indian government has made significant strides in enhancing ethanol blending in petrol, advancing the target for 20% ethanol blending (E20) to Ethanol Supply Year (ESY) 2025-26—five years earlier than originally planned under the National Policy on Biofuels – 2018 (amended in 2022). Steady Progress in Ethanol Blending The Public Sector Oil Marketing Companies (OMCs) surpassed the 10% ethanol blending target in June 2022, five months ahead of schedule. Ethanol blending has steadily increased over the years: 12.06% in ESY 2022-23 14.60% in ESY 2023-24 17.98% in ESY 2024-25 (as of 28th February 2025). As of now, no decision has been taken to increase ethanol blending beyond 20%. Impact of E20 on Vehicle Performance According to the Roadmap for Ethanol Blending in India (2020-25), using E20 fuel leads to a marginal reduction in fuel efficiency for vehicles originally designed for E10 fuel. However, the Society of Indian Automobile Manufacturers (SIAM) has noted that engine modifications can mitigate this efficiency loss. Testing has shown no major issues with engine performance, component wear, or oil degradation when using E20 fuel. Expanding Feedstock for Ethanol Production The National Biofuel Coordination Committee permits the use of surplus food grains for ethanol production. Key feedstock sources include: Sugarcane derivatives: Molasses, sugarcane juice Food grains: Maize, broken rice, surplus grains Agricultural residues: Rice straw, cotton stalk, bagasse, corn cobs, sawdust The utilisation of specific feedstocks is calibrated annually based on availability, cost, market demand, and policy incentives. Government Measures to Promote Ethanol Production: Since 2014, the government has implemented several initiatives to scale up ethanol production under the Ethanol Blended Petrol (EBP) Programme: Expansion of feedstock sources for ethanol production. Administered pricing mechanism for ethanol procurement. Reduction of GST on ethanol to 5% under the EBP Programme. Eased interstate and intrastate ethanol movement through amendments to the Industries (Development and Regulation) Act. Simplified procurement process by OMCs. Advancement of the 20% ethanol blending target from 2030 to ESY 2025-26. Introduction of Ethanol Interest Subvention Schemes (EISS) (2018-22) to promote ethanol production from both molasses and grains. Long-Term Offtake Agreements (LTOAs) between OMCs and Dedicated Ethanol Plants (DEPs). These measures are designed to encourage ethanol producers and farmers while ensuring a sustainable transition to higher ethanol blending levels in India's fuel mix. This update was provided by Minister of State for Petroleum and Natural Gas, Shri Suresh Gopi, in a written response to the Lok Sabha today.

Infrastructure Urban

06 Apr 2026

InsideFPV Delivers ₹10 Crore Kamikaze Drone Order Under MoD’s EPR Route

InsideFPV, a Surat-based drone technology manufacturer, has successfully executed a ₹10 crore defence contract to supply indigenous kamikaze drones under the Ministry of Defence’s Emergency Procurement Route (EPR). The company completed the delivery of hundreds of FPV kamikaze drone platforms within a rapid two-month timeframe, highlighting its ability to meet urgent military procurement timelines.The supply orders were fulfilled under the emergency procurement mechanism, which is aimed at fast-tracking acquisitions for immediate operational needs. InsideFPV’s quick execution reflects it..

Infrastructure Energy

06 Apr 2026

Vedanta Resources Secures Fitch Upgrade to ‘BB-’, Best Rating Since 2015

Vedanta Resources Limited (VRL), a global player in metals, oil & gas, critical minerals, power and technology, has received a credit rating upgrade from Fitch Ratings, marking its strongest bond rating in over a decade.Fitch has raised Vedanta Resources’ Long-Term Foreign-Currency Issuer Default Rating (IDR) to ‘BB-’ from ‘B+’, while maintaining a Stable Outlook. The agency also upgraded VRL’s senior unsecured rating, along with the ratings of US dollar-denominated bonds issued by Vedanta Resources Finance II Plc and guaranteed by VRL, to ‘BB-’.The upgrade represents Vedan..

Real Estate

06 Apr 2026

NAREDCO NextGen NCR Chapter Launched

The NAREDCO NextGen NCR Chapter was recently launched at Excelerate 2026 in Mumbai, marking a key step towards integrating emerging real estate leaders from the National Capital Region with the national platform. The initiative aims to promote sustainable and responsible urban development through collaboration and knowledge exchange.The event brought together young developers, entrepreneurs, and professionals from across NCR, including Noida, Gurugram, Ghaziabad, Faridabad, Bhiwadi, and Meerut. Discussions focused on urban development, finance, sustainability, innovation, and policy, emphasisi..