India’s decision to raise 25% ethanol blending in petrol from the current 20% level will depend on the recommendations of a committee constituted by the Union Government, Union Minister Pralhad Joshi said in Hubballi.
Joshi, who holds the portfolios of Food, Public Distribution and Consumer Affairs, New and Renewable Energy, and Education, said the government has formed the panel to examine a possible increase in the blending target. He made the remarks while responding to questions over the ongoing debate around the country’s ethanol blending programme.
The comments were reported by The New Indian Express following Joshi’s interaction with the media in Hubballi on Tuesday.
Government awaits committee recommendations on E25
Joshi said a final decision on moving towards 25% ethanol blending in petrol would be taken after the committee submits its recommendations.
The development keeps the next stage of India’s ethanol blending programme under review rather than establishing a new 25% mandate. The minister did not provide a timeline for the committee’s report or specify the terms of reference in the remarks reported by The New Indian Express.
India has already reached the 20% blending level that the government had previously targeted. Joshi said the policy had been pursued in phases, with the current programme building on initiatives that began under earlier governments.
According to Joshi, the ethanol blending policy was conceived during the Atal Bihari Vajpayee-led government in 2003-04, while implementation began during the subsequent United Progressive Alliance (UPA) period, when blending was slightly above 1%. The Narendra Modi government subsequently continued the programme and increased blending in stages to 20%, he said.
Ethanol production linked to sugar-sector finances
Joshi also defended the ethanol programme in the context of the financial position of India’s sugar industry.
He said increased ethanol production had helped sugar factories address outstanding payments to sugarcane growers. According to his statement, when the Modi government came to power, sugar mills had accumulated substantial farmer arrears and the Centre provided loans of around Rs 14,000 crore to help clear those dues.
The minister presented ethanol production as part of the government’s approach to addressing the sugar sector’s financial pressures.
The relationship between sugar and ethanol has become an important element of India’s biofuel policy, as mills can divert eligible feedstocks and intermediates towards ethanol production rather than relying solely on sugar sales.
E25 decision could shape the next phase of India’s ethanol market
A move from 20% to 25% blending would represent another increase in the volume of ethanol required by the petrol market. However, Joshi’s latest comments indicate that the government has not yet made that policy decision and is awaiting the committee’s assessment.
The development therefore places the committee’s recommendations at the centre of the next stage of India’s ethanol policy.
For ethanol producers, the eventual policy direction could have implications for future demand, production planning and feedstock allocation. However, the minister’s comments do not establish what recommendations the committee will make or whether the government will ultimately approve a 25% blending target.
Ethanol policy continues to evolve beyond E20
India’s ethanol programme has expanded substantially from the relatively low blending levels seen when the programme was first implemented. Joshi’s remarks underline the government’s continued interest in evaluating higher blending levels while also linking ethanol production to the economics of the sugar sector.
The New Indian Express report also noted that Joshi was responding to controversy surrounding 20% ethanol blending, indicating that the policy remains subject to public and political debate as the country considers its next phase.
For now, the government’s position is that the 25% blending decision will follow the committee’s recommendations, leaving the timing and precise policy framework for E25 to be determined after that assessment.
Bioenergy Business Analysis
The proposed move towards 25% ethanol blending would represent a further step in India’s gradual expansion of the domestic fuel-ethanol market, but the latest comments are significant primarily because they confirm that E25 remains under examination rather than being an announced mandate.
The committee’s eventual recommendations will be important for the industry because a higher blending target would need to be considered alongside ethanol availability, feedstock allocation, sugar-sector requirements and the infrastructure needed to supply petrol with higher ethanol content. The government’s decision will therefore determine whether India moves from the current E20 framework towards a new 25% blending phase.
For ethanol producers and sugar mills, the immediate development is the review itself. Until the committee reports and the government takes a decision, the scale and timing of any E25 expansion remain uncertain.
Read also: Maharashtra ethanol investment at risk from potential feedstock curbs, Tope warns
