top of page

By:

Sagari Gupta

24 March 2026 at 2:16:04 pm

From Green Fuel to Strategic Fuel

India’s ethanol revolution will succeed only if its costs are shared more fairly. On June 13, Union Minister Nitin Gadkari approved regulations giving E100 fuel legal status in India. The move does more than add two new fuel grades to India’s pumps. It marks the evolution of ethanol from a green fuel and sugar-surplus solution into a strategic fuel designed to reduce India’s exposure to external energy shocks. For over a decade, the older version of the ethanol programme delivered real,...

From Green Fuel to Strategic Fuel

India’s ethanol revolution will succeed only if its costs are shared more fairly. On June 13, Union Minister Nitin Gadkari approved regulations giving E100 fuel legal status in India. The move does more than add two new fuel grades to India’s pumps. It marks the evolution of ethanol from a green fuel and sugar-surplus solution into a strategic fuel designed to reduce India’s exposure to external energy shocks. For over a decade, the older version of the ethanol programme delivered real, measurable gains. Union Minister for Petroleum and Natural Gas Hardeep Singh Puri said on June 4 that the ethanol blending programme has saved India Rs. 1.84 lakh crore in foreign exchange and added Rs. 1.58 lakh crore to farmers’ earnings since 2014-15, while substituting 302 lakh metric tonnes of crude oil and cutting 909 lakh metric tonnes of CO2 emissions. The new policy answers a harder question. India imports around 85 percent of its crude oil requirements. Tensions around the Strait of Hormuz, through which about a fifth of the world’s oil moves, keep reminding policymakers what that dependence costs. Gadkari has put India’s annual fossil fuel import bill at roughly Rs. 22 lakh crore, near $250 billion at current exchange rates. Every litre of ethanol that replaces imported crude is a small subtraction from that bill and a small addition to India’s room to manoeuvre when oil prices spike. That logic is sound. The fairness of the transition is a separate question. Uneven Costs Energy security is a public good: a steadier rupee, lower inflation and reduced reliance on oil exporters benefit the entire economy. Yet the costs are far less evenly shared. The immediate winners are sugar-producing states, distilleries and the government, which enjoys a lower import bill and greater diplomatic flexibility. Nor is the environmental case as straightforward as the carbon figures suggest. Producing a litre of sugarcane-based ethanol requires about 2,860 litres of water, according to NITI Aayog. Most ethanol comes from sugarcane and maize grown in Maharashtra, Uttar Pradesh and Punjab - states already overexploiting groundwater. Ethanol is also competing with food and feed. Maize prices have risen as distilleries compete with the poultry industry, while India has shifted from being a maize exporter to an importer. The Centre for Study of Science, Technology and Policy estimates that meeting ethanol targets by 2030 could require additional maize acreage equivalent to a quarter of India’s farmland. In Rajasthan’s Tibbi, farmers have already protested against a new ethanol plant. A cleaner path exists. Second-generation ethanol made from paddy straw, sugarcane bagasse and other crop waste does not compete with food or fresh water the same way first-generation ethanol does. India has a handful of 2G plants running, including one at Panipat, but high capital costs and slow technology adoption keep them marginal next to sugarcane and grain-based ethanol. E85 and E100 need flex-fuel vehicles built for higher ethanol shares. Maruti Suzuki and Hero MotoCorp have begun rolling out flex-fuel models, but as of April this year no automaker had a vehicle commercially available that ran on E85, and Maruti’s own flex-fuel prototype only appeared in June. Neither company has disclosed what the flex-fuel variants will cost against standard petrol models. The fuel itself is cheaper at the pump. Delhi’s first E85 station, opened on June 5 at Indian Oil’s Pusa Road outlet, priced the fuel at Rs. 82.12 a litre, about Rs. 20 below regular E20 petrol. But ethanol carries less energy than petrol, and E85 cuts mileage by 20 to 35 percent compared with petrol. A cheaper litre that takes you fewer kilometres is not automatically a cheaper kilometre. Gadkari has asked the finance ministry to cut GST on E85 from 18 percent to 5 percent, which would help close that gap. The GST Council has not decided yet, and its decision in the coming weeks will tell us whether the government means to share the cost of this transition or leave it with early adopters. There is a fiscal cost behind the consumer one. Oil marketing companies are set to pay farmers close to Rs. 40,000 crore in 2025 alone under the blending programme, on top of the subsidies and soft loans that prop up ethanol distilleries. Infrastructure tells a similar story. The government’s rollout plan covers Delhi-NCR and the Mumbai-Pune-Nagpur corridor first, with a target of 500 E85 outlets by December 2026 and 5,000 by the end of 2027. A household outside those corridors that buys a flex-fuel vehicle today pays for infrastructure it cannot yet use. This is where the comparison with E20 matters. The earlier blending programme spread its costs thinly across every petrol buyer in the country, through a few percentage points of ethanol nobody had to think about or pay extra for. E85 and E100 work differently. They ask a smaller group of early adopters to absorb a vehicle upgrade, a pricing gap and an infrastructure lag all at once, in exchange for a national benefit every taxpayer will eventually share. Fairer Transition None of this is an argument against E85 and E100. India needs to cut its dependence on imported crude, and ethanol is the most realistic domestic substitute on the table right now. The environmental costs of first-generation ethanol are real too. The question is who absorbs its costs, and what kind of ethanol pays for it. The transition can be made fairer in four ways: extend any GST cut on E85 to flex-fuel vehicles; link vehicle sales to the availability of E85 pumps; require automakers to disclose price premiums and real-world mileage; and shift more incentives towards second-generation ethanol that does not strain water tables or food supplies. For a decade, India’s ethanol programme delivered foreign-exchange savings and higher farm incomes without imposing visible costs on consumers or water-stressed regions. E85 and E100 change that equation. They turn a public good - energy security - into an upfront private cost borne first by households and farming regions, while the wider benefits are shared by the country as a whole. (The writer is an independent public policy researcher. Views personal.)

People praise Army for protecting

Jammu and Kashmir Chief Minister Omar Abdullah interacts with displaced border residents at a shelter camp.
Jammu and Kashmir Chief Minister Omar Abdullah interacts with displaced border residents at a shelter camp.

Garkhal (J&K): Men and machines of the armed forces worked meticulously to ensure the interception of Kamikaze drones and missiles fired by Pakistani troops targeting Jammu, drawing widespread appreciation from people.


India on Thursday night swiftly thwarted Pakistan's fresh attempts to strike military sites with drones and missiles, including in Jammu and Pathankot, after foiling similar bids at 15 locations across the country's northern and western regions, amid a military conflict between the two neighbours.


Looking after the operational area of Jammu under the command of the 9 Corps, the 26 Infantry Division, nicknamed the "Tiger Division", had put in place a robust air-defence system, virtually carving out an Israel-type Iron Dome to protect Jammu from a Hamas-style attack by Pakistan.


An official who was privy to the developments said it was a meticulous combination of men and machines in defence that thwarted such a massive Pakistani attack.


In the dead of night, Pakistan unleashed its most audacious assault on Jammu since the 1971 war, deploying a swarm of more than a hundred Kamikaze drones and missiles in a sinister attempt to devastate the city. But what followed was a show of unmatched precision, courage and resilience.


"We are indebted to our armed forces who have saved Jammu from a major attack by Pakistan. We appreciate them for their missionary work. We never thought these bombs could be neutralised in the air," Garkhal resident Sikender Singh said.


Singh, whose family, along with more than 500 villagers, has shifted to safer camps set up by the government in Mishriwala on the Jammu outskirts, said had the bombs not been intercepted, they could have caused massive deaths and destruction.


Finest system

The Army, backed by one of the world's finest air-defence systems, intercepted the aerial barrage with astonishing accuracy -- virtually every hostile object was destroyed mid-air. Not a single vital installation was touched. Not a single civilian life was lost.


"Eight missiles from Pakistan were directed at Satwari, Samba, R S Pura and Arnia. All were intercepted and blocked by air-defence units. Visuals over Jammu reminded exactly of a Hamas-style attack on Israel, like multiple cheap rockets," an Army official said.


He said the Pakistan Army is operating and behaving like Hamas. "Drones were sighted at multiple places along the western front -- confirmed to be hostile. They are being effectively engaged by our air-defence systems. Pakistani drone attacks have been reported at various locations along the western borders and are being effectively countered by the Indian armed forces," he added.


The multi-tier air-defence system, with a twin technological security architecture of Russian and Israeli surface-to-air missile setups and the indigenous Akash, was a game changer against such attacks.


Former Jammu and Kashmir director general of police S P Vaid appreciated the armed forces and their technological security systems for effectively dealing with the Pakistani attacks.


He said 50 to 60 air attacks by Pakistan over Jammu and other places were neutralised on Thursday night by the impregnable air-defence system of the country.


Comments

bottom of page