India's Ethanol Programme Raises Questions on Transparency and Sustainability
India has achieved its target of blending 20% ethanol into petrol five years ahead of schedule, but at what cost? The government claims that this initiative has saved over ₹1.97 lakh crore in foreign exchange and avoided CO₂ emissions of 952 lakh metric tonnes.
The petroleum ministry has disclosed that the weighted average ex-mill price of ethanol is ₹66.61 a litre, with oil marketing companies' delivered cost at ₹71.10-71.21 per litre. Maize-based ethanol accounts for 72% of allocation, but farmers are not receiving fair prices.
The average mandi price of maize stayed below the minimum support price in every single month from March 2025 to August 2026. The draft Sugarcane (Control) Order, 2026 formally recognises ethanol as a mill output, yet still anchors the grower's entitlement to sugar alone.
Experts argue that the programme's central evasion is that it has never been transparent about its costs and distribution of benefits. They recommend publishing the full cost stack of a litre of E20, auditing the programme annually, and using excise levies to make energy-adjusted costs neutral.