India's ethanol production capacity has reached 2,000 crore litres per annum, providing adequate capacity to sustain the Ethanol Blending Programme and meet future requirements, according to Minister of State for Petroleum and Natural Gas Suresh Gopi. As reported by ANI, the government has clarified that this capacity has been planned not only to meet current E20 blending requirements but also to cater to future growth in petrol demand, provide operational flexibility during seasonal variations in feedstock availability and support higher ethanol blends, flex-fuel vehicles and other emerging biofuel applications, as and when approved by the Government. The Minister emphasized that the ethanol production capacity created in the country has been developed keeping future requirements in mind.
India achieved 20% ethanol blending during the Ethanol Supply Year (ESY) 2025-26, five years ahead of the original 2030 target, according to Gopi's written reply to the Rajya Sabha. According to the minister, ethanol blending rose from just 1.53% in 2013-14 to 20% in ESY 2025-26, with progressive increases from 10% in ESY 2021-22, 12.06% in ESY 2022-23, 14.60% in ESY 2023-24, and 19.20% in ESY 2024-25. The government's clarification addresses why India's installed ethanol production capacity is significantly higher than the annual requirement for achieving 20% ethanol blending.
The government implemented several policy measures to create a robust ethanol ecosystem, including administered ethanol pricing, the National Policy on Biofuels 2018, reduction of GST on ethanol for blending from 18% to 5%, interest subvention for ethanol projects, long-term procurement agreements by oil marketing companies and expansion of storage infrastructure, as reported by ANI. Addressing concerns over diversion of food crops for ethanol production, the government follows a diversified feedstock strategy under the National Policy on Biofuels. Ethanol is produced from multiple approved feedstocks including sugarcane-based raw materials, maize, damaged foodgrains, broken rice, surplus foodgrains approved by the National Biofuel Coordination Committee (NBCC) and other approved agricultural feedstocks. The government is also promoting second-generation (2G) ethanol from agricultural residues under the Pradhan Mantri JI-VAN Yojana to gradually increase the use of non-food feedstocks.
On food security, the Minister emphasized that food security, Public Distribution System (PDS) requirements, National Food Security Act (NFSA) obligations, Other Welfare Schemes (OWS) and prescribed buffer stocks are accorded the highest priority. Only surplus foodgrains, after meeting these requirements, are permitted for ethanol production. The government is promoting crop diversification towards comparatively less water-intensive feedstocks such as maize to ensure expansion of ethanol feedstocks remains balanced with the production of pulses, oilseeds and other essential food crops. This strategic approach ensures sustainable growth in ethanol production while maintaining food security objectives.
