The National Policy on Biofuels is significantly accelerating the production and use of biofuels—especially biodiesel—across India, the government informed the Lok Sabha on Thursday. In a written reply, Minister of State for Petroleum and Natural Gas Shri Suresh Gopi outlined the range of measures driving the expansion of the biodiesel ecosystem.
According to the Ministry of Petroleum and Natural Gas, the policy framework promotes biodiesel blending with conventional diesel and permits its direct sale, helping widen its adoption. Key interventions such as the 2019 Guidelines for Sale of Biodiesel for Blending with High-Speed Diesel and the reduction of GST on biodiesel procurement from 12% to 5% have provided further momentum to the programme.
The Ministry emphasized that the Biodiesel Blending Programme is generating new economic opportunities for farmers by increasing demand for locally sourced feedstock. Tree-Borne Oils (TBOs) including Karanja, Neem, Mahua and Pongamia—crops that thrive in drought-prone and underutilized wasteland with minimal inputs—are emerging as major contributors to biodiesel production.
Officials added that the policy is also stimulating rural employment through greater participation in plantation activities, seed collection and oil extraction. The expanding biodiesel value chain not only enhances the use of waste and low-value agricultural products but also supports crop diversification, boosts rural incomes and mitigates farmers’ reliance on single-crop earnings.
The government reiterated its commitment to strengthening the biofuel sector, highlighting its potential to improve energy security, support rural livelihoods and contribute to a more sustainable fuel ecosystem in the country.
