Ethanol Boost: India Saves ₹1,06,072 Crore in Foreign Exchange from 2014 to August 2024
India’s Ethanol Blended Petrol (EBP) Program is making waves, providing financial support to farmers and ethanol producers while saving the government a substantial amount in foreign exchange.
At the recent 12th CII Bioenergy Summit, themed “Fuelling the Future – Securing India’s Green Growth Goals,” Union Minister Hardeep Singh Puri shared exciting news with a diverse audience of CEOs, policymakers, researchers, and diplomats from key bioenergy nations like the US, Brazil, and France.
The ethanol blending percentage has surged from 1.53% in 2014 to an impressive 15% in 2024. This achievement prompted the government to move the 20% blending target five years earlier, now set for 2025. As a result, India has saved ₹1,06,072 crore in foreign exchange, provided ₹90,059 crore to farmers, replaced 181 lakh metric tons of crude oil, and cut down CO2 emissions by 544 lakh metric tons from 2014 to August 2024.


He remarked, “As India’s energy demand rises, balancing our energy sources—traditional versus alternative—will shape our green future. Under PM Modi’s leadership, bioenergy will be crucial in reaching our Net Zero goals through various initiatives like ethanol blending, biodiesel, and waste-to-energy solutions.”
The government’s efforts to boost ethanol production are showing great results. Recently, Oil Marketing Companies (OMCs) sought tenders for 916 crore liters of denatured anhydrous ethanol for the 2024-25 Ethanol Supply Year, with manufacturers exceeding expectations by offering over 970 crore liters. This enthusiastic response reflects the commitment of ethanol producers, especially with recent government measures aimed at increasing production. The 20% blending target, once set for 2030, is now in reach for the 2025-26 supply year.
India’s ethanol production capacity has grown to 1,648 crore liters, and the government is optimistic that this will meet domestic needs.
Since 2014, multiple initiatives have been introduced to boost local ethanol production, including:
• Reintroducing a price control mechanism.
• Opening new pathways for ethanol production.
• Amending the Industries (Development & Regulation) Act to streamline ethanol distribution.
• Reducing the GST on ethanol for the EBP Programme from 18% to 5%.
• Implementing differential pricing based on raw materials.
• Expanding the EBP Programme nationwide, except for the Andaman and Nicobar Islands and Lakshadweep, since April 1, 2019.
• Launching an Interest Subvention Scheme to support the enhancement of ethanol production capacity.
• Publishing a Long Term Policy on ethanol procurement.
These initiatives reflect India’s dedication to sustainable energy and economic growth through increased use of biofuels, paving the way for a greener future.