New Delhi: Union Road Transport and Highways Minister Nitin Gadkari has strongly backed the next phase of India’s ethanol-blending programme, calling for lower taxes on higher ethanol blends and rejecting claims that ethanol is an inferior fuel.
Speaking at the launch of Hero MotoCorp’s flex-fuel variants of the Splendor+ and HF Deluxe motorcycles, Gadkari said he has raised concerns over the higher GST imposed on fuels containing more than 20 per cent ethanol and urged a review of the tax structure to encourage wider adoption, Hindustan Times reported.
According to Gadkari, ethanol-blended fuels above E20 currently attract 18 per cent GST, compared to just 5 per cent on E20 fuel. He said Finance Minister Nirmala Sitharaman has assured him that the matter will be discussed with state governments at an upcoming GST Council meeting.
The minister also dismissed concerns regarding the performance of ethanol-powered vehicles, stating that technical studies have shown ethanol delivers power and torque comparable to conventional petrol.
“Sometimes people talk about ethanol as an inferior fuel, but it is not,” Gadkari said, adding that vehicle performance on ethanol is on par with petrol-based fuels.
The remarks come as the government intensifies efforts to promote higher ethanol blending in transport fuels. Petroleum and Natural Gas Minister Hardeep Singh Puri, who was also present at the event, said E85 fuel containing 85 per cent ethanol and 15 per cent petrol is expected to be substantially cheaper than the currently available E20 fuel.
Puri said the government is examining policy measures to support faster and more affordable adoption of E85. He noted that even a one per cent penetration of E85 during the 2026-27 supply year could generate demand for around four crore litres of ethanol.
With E20 petrol already available nationwide, the government’s focus is now shifting towards higher ethanol blends. Automobile manufacturers have also begun introducing vehicles capable of operating on E85 fuel.
To support this transition, the Ministry of Road Transport and Highways has proposed amendments to the Central Motor Vehicles Rules, 1989, to enable wider use of E85, E100, B100 biodiesel and hydrogen-CNG fuel combinations across vehicle categories.
The proposed changes are intended to facilitate the introduction of flex-fuel and biofuel-powered vehicles while expanding fuel options for consumers.
India has already achieved 20 per cent ethanol blending in petrol using ethanol produced from sugarcane, maize and rice. The programme has been promoted as a way to reduce crude oil imports, lower carbon emissions and strengthen the country’s energy security.
The government has also advised public and private oil marketing companies to prepare dispensing infrastructure for fuels with varying ethanol content, including E20, E22, E25 and E30, allowing consumers to choose fuel based on vehicle compatibility.
The latest developments indicate that India is preparing for a gradual transition towards higher ethanol blends, with E85 emerging as the next major milestone in the country’s biofuel roadmap.
