Ethanol shift can save India ₹195 crore forex per 1% switch: Hardeep Puri
Synopsis
India's flex-fuel moment is here. Hardeep Puri says even a 1% switch from petrol to ethanol vehicles can save ₹195 crore in forex annually — and with E85 now rolling out at cheaper-than-petrol prices, the demand side of India's biofuel push finally has a vehicle to ride on.
Key Takeaways
Hardeep Singh Puri said a 1% shift to ethanol vehicles can save India nearly ₹195 crore in forex per ethanol supply year.
E85 fuel — up to 85% ethanol blended with petrol — will be available at designated stations and priced below petrol.
Mass-market flex-fuel mobility was formally launched on 3 June in New Delhi.
Nitin Gadkari on 25 May unveiled an indigenous ethanol-water cooking stove in Nagpur, claiming it is cheaper than LPG.
Gadkari also announced a ₹40 crore initiative to promote scientific temperament among youth.
Union Petroleum and Natural Gas Minister Hardeep Singh Puri on Wednesday, 3 June said a mere 1 per cent shift in India's annual petrol vehicle sales to ethanol-powered vehicles could save the country nearly ₹195 crore in foreign exchange during a single ethanol supply year. Speaking in New Delhi, the minister formally flagged off mass-market flex-fuel mobility, calling it a major milestone in India's push to cut its imported fossil fuel bill.
Key announcements
Puri announced that E85 fuel — a blend containing up to 85 per cent ethanol with petrol — will be made available through designated dispensing stations across the country. According to the minister, E85 will be substantially cheaper than conventional petrol, positioning it as a cost-effective option for Indian consumers.
“Mass market flex fuel mobility has begun today,” Puri said, underlining the government's intent to scale ethanol-based fuels across the transport sector.
Why it matters for energy security
India remains one of the world's largest crude importers, and any structural reduction in petrol demand directly trims the forex outgo. “The move would not only strengthen the country's energy security but also support the government's broader strategy of promoting domestically produced biofuels,” Puri said.
He added that greater adoption of ethanol-powered vehicles could significantly reduce India's crude oil and petroleum import bill while generating fresh demand for domestically produced ethanol — a value chain that loops back to sugarcane and grain farmers.
The wider biofuel push
India has been steadily raising ethanol blending in petrol to cut fossil fuel imports, lower carbon emissions and create additional farm income through the biofuel value chain. The rollout of flex-fuel vehicles is the demand-side counterpart to the blending programme that has dominated the supply side so far.
Gadkari's ethanol stove pitch
The announcement comes weeks after Union Minister for Road Transport and Highways Nitin Gadkari unveiled an indigenous ethanol-based cooking stove technology in Nagpur on 25 May, claiming it can produce cooking flames at a lower cost than commercial LPG cylinders. Gadkari also announced a ₹40-crore initiative to promote scientific temperament among young Indians.
“By mixing 7 per cent ethanol in water, stove-like flames are generated, and it is cheaper than cooking gas. It is indigenous to our country,” Gadkari said at the event.
What's next
With E85 dispensing stations being rolled out and flex-fuel vehicles entering the mass market, the next test will be consumer uptake and original equipment manufacturer (OEM) readiness. The pace of station roll-out and pricing differential with petrol will determine how quickly the projected forex savings materialise.
Point of View
But the real story is whether the demand side finally catches up with India's ethanol supply ambitions. Blending targets have moved fast on paper; flex-fuel vehicle penetration has not. Without OEM commitments, a dense E85 dispensing network, and a stable price gap with petrol, this risks being another supply-led push waiting for consumers. The forex math only works if Indians actually buy and drive these vehicles at scale.
NationPress
20 Jul 2026
Frequently Asked Questions
How much forex can India save by shifting to ethanol vehicles?
According to Union Minister Hardeep Singh Puri, a 1 per cent shift in India's annual petrol vehicle sales to ethanol-powered vehicles can save nearly ₹195 crore in foreign exchange during one ethanol supply year. The savings come from a reduced crude oil import bill.
What is E85 fuel and where will it be available?
E85 is a fuel blend containing up to 85 per cent ethanol mixed with petrol. It will be sold through designated fuel dispensing stations across India and is expected to be substantially cheaper than conventional petrol.
Why is the government pushing flex-fuel vehicles?
The government is promoting flex-fuel vehicles to cut India's dependence on imported crude oil, strengthen energy security, lower carbon emissions, and create additional demand for domestically produced ethanol — which in turn benefits farmers in the biofuel value chain.
What did Nitin Gadkari announce about ethanol cooking stoves?
On 25 May in Nagpur, Nitin Gadkari unveiled an indigenous ethanol-based cooking stove technology that uses a blend of 7 per cent ethanol in water to generate flames. He said it is cheaper than commercial LPG cylinders. He also announced a ₹40 crore initiative to promote scientific temperament among young Indians.
