Just a few months ago, India’s ethanol blending programme faced strong criticism, particularly over concerns about vehicle mileage and maintenance. Union Minister Nitin Gadkari was on target, while debates around “food versus fuel” intensified. As a result, ethanol blending in petrol appeared to stall at 20%, with uncertainty clouding the programme’s future.
However, the situation has shifted dramatically. Escalating tensions in West Asia and disruptions in oil and gas supplies from Gulf countries have brought ethanol back into focus. Brent crude, which hovered around $60–70 per barrel just three weeks ago, has surged by nearly 40%. India’s heavy dependence on energy imports has once again been exposed, prompting renewed calls to raise ethanol blending in petrol from 20% to 30%.
Addressing the Lok Sabha on the ongoing crisis, Prime Minister Narendra Modi highlighted the significant progress made in ethanol production and blending over the past decade. He noted that ethanol blending capacity has risen from just 1–1.5% a decade ago to nearly 20% today, helping India reduce crude oil imports by about 45 million barrels annually.
PM Modi expressed confidence that India’s growing focus on alternative fuels would strengthen long-term energy security. He added that the government is actively engaging with stakeholders across sectors and extending support wherever required. The statement has been viewed positively by the ethanol-producing distillery industry.
The All India Distillers Association (AIDA) has urged the government to increase ethanol blending gradually from 20% to 30% (E30). The association’s DDG Bharati Balaji, in a letter to Gadkari, proposed several measures, including introducing flex-fuel vehicles capable of running on 100% ethanol like Brazil, encouraging the usage of ethanol in domestic and industrial cooking, and exploring ethanol blending in diesel.
Speaking at AIDA’s Annual Distillers Conclave, Food Secretary Sanjeev Chopra said every crisis presents an opportunity, and the current moment is ideal to push for further reforms in the ethanol blending programme. He highlighted that between 2014 and 2025, ethanol blending helped reduce crude oil imports by about 27.7 million tonnes, saving over Rs 1.63 lakh crore in foreign exchange.
The Indian Sugar & Bio-energy Manufacturers Association (ISMA) has also written to the Prime Minister’s Office, seeking a fast-tracked and calibrated roadmap beyond E20. The industry believes that higher blending targets are necessary to fully utilize existing production capacity.
ISMA Director General Deepak Ballani said the Prime Minister’s acknowledgement that ethanol blending has already saved 4.5 crore barrels of crude imports is a powerful validation of biofuels as a strategic pillar of India’s energy security.
The ethanol industry is ready to scale up supply beyond the 20% blending level. According to ISMA, with over 2,000 crore litres of domestic ethanol capacity—well above the 1,100 crore litres required for E20—India is uniquely positioned to move swiftly towards higher blends like E22–E27 and scale up Flex-Fuel Vehicles for E85/E100.
The Grain Ethanol Manufacturers Association (GEMA) President C.K. Jain emphasized that continued policy support could help ethanol reduce crude dependence while boosting the rural economy. Grain-based ethanol production, he noted, is already creating new market opportunities and improving farmer incomes.
As global uncertainties continue to test India’s energy resilience, ethanol is steadily emerging as a viable, home-grown alternative to cushion the economy against volatile oil markets. However, challenges remain, including concerns over vehicle compatibility, supply chain logistics, water use in feedstock cultivation, and the ongoing food versus fuel debate.