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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.)

The End of Nuclear Blackmail and India’s Doctrine of Resolve

By refusing to be cowed by nuclear blackmail, India has drawn a red line after Operation Sindoor that challenges the West’s double standards.

Last month, during his first public address following the retaliatory Operation Sindoor (which was launched by India after the April 22 Pahalgam terrorist strike), Prime Minister Narendra Modi made two statements of consequence on India’s approach to Pakistan. First, he reiterated that “terrorism and talks cannot go together” which has been a long-standing position. But it was the second assertion that has marked a paradigm shift. Modi firmly said that India would “no longer relent to nuclear war blackmail.” The gauntlet has been firmly thrown.


The hardening of India’s response is informed not merely by the regularity of Pakistan-sponsored terror, but by the coordinated international reaction that followed India’s retaliatory strike. Even before the first sortie of Operation Sindoor had taken off, Pakistani leaders were already issuing shrill warnings of nuclear escalation that were eagerly amplified by Western governments and their media outlets in what appeared to be a synchronised chorus. This, despite India’s prior communication to both Islamabad and key Western capitals that the operation would be narrowly focused on terrorist infrastructure in Pakistan and Pakistan-occupied Kashmir.


New Delhi’s political establishment was understandably dismayed. President Donald Trump has repeatedly claimed that he had helped to “stop” such a war. The irony is rich: India, which would have borne the brunt of any hypothetical nuclear exchange, had raised no such alarms. Nor did Russia or several other non-Western powers. Why then was the West so quick to sound the nuclear sirens?


The West’s nuclear alarmism is not new. During the Kargil conflict in 1999, similar warnings were issued and that, too, only after Indian forces began turning the tide. Contrast that with other flashpoints involving nuclear powers. Whether it is the proxy war between NATO and Russia in Ukraine or tensions between the US and China in the South China Sea, nuclear escalation is rarely part of the mainstream Western narrative. Indeed, only the West has actually dropped nuclear bombs – the U.S. against Japan in Hiroshima and Nagasaki in August 1945 - and in more recent decades deployed depleted uranium munitions in conflicts like Iraq and Syria.


Today, Russia has openly threatened the use of nuclear weapons should NATO escalate the war in Ukraine. Yet Western leaders have dismissed such warnings as bluster while continuing to arm Ukraine. Why the double standard?


To understand the West’s selective nuclear sensitivity, one must examine its strategic interests in South Asia.


The West’s primary interest in India is economic: tapping into its vast market. Geopolitically, India is useful as a counterweight to China and a potential partner in loosening ties with Russia. But this partnership is conditional. India’s ambitions for regional leadership and a permanent seat on the UN Security Council are often met with quiet resistance. New Delhi is welcomed into forums like the Quad but kept just outside the gates of elite global influence. Meanwhile, subtle interference in form of often stoking tensions along its borders keeps India preoccupied at home and less assertive abroad.


By contrast, the West’s relationship with Pakistan has been mercurial, oscillating between that of a ‘key ally’ and a troublesome but tolerated partner. Pakistan’s strategic location, abutting Iran, China, Afghanistan and India, makes it invaluable for Western power projection. Its ruling elites, especially the military, have long been compliant instruments of Western designs in the region. The West does not object to Pakistan being poor so long as its generals and political elites remain well-fed. Arms supplies from China, Turkey and the West keep the Pakistani military well-stocked, even as its economy teeters.


Pakistan’s armed forces are capable, but the country’s economic fragility means it cannot sustain a multi-front war. This is where its nuclear arsenal plays a vital role. Unlike India’s nuclear programme which was conceived with China in mind, Pakistan’s is aimed squarely at India. This suits both Chinese and Western interests: it keeps India’s strategic ambitions in check while maintaining Pakistan’s utility as a lever.


India’s nuclear ambitions have long been viewed with suspicion by the West. Despite never breaching any international treaties or IAEA protocols, India faced sanctions, sabotage, and even physical attacks on its scientists. Only in the past two decades has the tide turned somewhat, with civil nuclear agreements and defence cooperation frameworks emerging, albeit cautiously.


Pakistan, on the other hand, encountered no such roadblocks. Its nuclear programme was bankrolled by petrodollars from autocracies in the Middle East, technically assisted by China, and diplomatically ignored by the West. Intelligence agencies like the CIA, despite being deeply embedded in Pakistan, looked the other way. Indeed, parts of the Western intelligence and industrial complex covertly assisted the effort, with evidence linking countries like the Netherlands, Switzerland and Japan in facilitating uranium enrichment and centrifuge technology.


When Pakistan’s infamous nuclear proliferation network led by A.Q. Khan was caught peddling atomic secrets to North Korea, Libya and Iran, the West’s reaction was muted. The IAEA was never allowed to investigate. Western agencies later acknowledged, mostly for domestic consumption, that they had been aware of the activities but refrained from action “due to strategic concerns.”


The practical utility of nuclear weapons today lies less in their use and more in the threat they pose. Pakistan, aided by sympathetic voices in the West, has mastered this psychological game, using nuclear posturing to deter Indian retaliation and influence international opinion. Each time India responds to a terrorist provocation, Western governments swiftly raise concerns about ‘escalation,’ equating the aggressor and the victim.


This suits Pakistan perfectly. The threat of nuclear war acts as a shield, allowing it to wage a proxy war through jihadist outfits without inviting full-scale retaliation. For the West, this equilibrium keeps Pakistan pliable and militarily available for use in other theatres without the risk of it being destabilised by a conventional war with India. Everyone wins -m except India.


The double standard is glaring. India, a democracy and a responsible nuclear power, is routinely bracketed with a state sponsor of terrorism. The moment it responds to provocation, global headlines scream of apocalypse. And so far, the West’s concern has rarely been for Indian lives lost to terrorism but for the hypothetical risks posed by India’s response.


This time, India appears determined to challenge that narrative. Its move to send parliamentary delegations to explain its position to foreign governments and global institutions was a well-thought out one. The aim is to dismantle the false equivalence between a sovereign democracy defending itself and a rogue state exporting terror.


Whether this campaign ultimately succeeds in shifting perceptions remains to be seen. But one thing is clear: India’s new doctrine of refusing to be cowed by nuclear blackmail is a strategic reset, and perhaps the clearest assertion yet that India intends to chart its own path in the world. After all, deterrence cannot be one-sided. If Pakistan continues to benefit from Western indulgence and nuclear bluffing, then India is justified in asserting its right to respond firmly and proportionately.


(The author is a veteran journalist based in Navi Mumbai. Views personal.)

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