Ethanol and Biofuel Revolution under PM Modi: India’s Green Energy Leap
By Aseervatham Achary
Ethanol is no longer just an alternative fuel—it is a symbol of India’s commitment to sustainability, innovation and inclusive growth. As the world searches for practical climate solutions, India is offering a blueprint: a model where energy, ecology, and economy move forward together
India’s journey towards energy self-reliance has witnessed a transformative chapter under the dynamic leadership of Prime Minister Narendra Modi. A nation that was once heavily dependent on crude oil imports is now emerging as a global torchbearer in the biofuel revolution. Through a series of well-crafted policy reforms, strategic investments, and forward-looking initiatives, the Modi government has not only strengthened India’s energy security but has also empowered rural communities, reduced foreign dependence, and elevated the country’s position in the global clean energy map.
The Need for Ethanol and Biofuels
India is one of the fastest-growing economies in the world and the third-largest consumer of primary energy after the United States and China. With its share in global energy consumption expected to double by 2050, the country’s rising demand poses significant challenges. Over 87 per cent of India’s crude oil needs are imported, exposing the economy to volatile global prices and geopolitical uncertainties. Furthermore, the excessive use of fossil fuels leads to increased carbon emissions and environmental degradation, resulting in rising health concerns.
To secure its energy future, India needed a sustainable, indigenous alternative. Ethanol blending with petrol has emerged as a potent solution. Ethanol, derived primarily from sugarcane and other biomass sources, reduces carbon emissions, saves foreign exchange, and boosts rural income. While the practice of ethanol blending was first introduced in 2001 during the Atal Bihari Vajpayee government, it remained stagnant under successive UPA regimes. It was only after 2014 that the Narendra Modi-led government accelerated this initiative, transforming it into a national movement.
Bold Reforms and a Clear Roadmap
The Modi government’s approach has been defined by clarity of vision, speed of implementation, and unwavering commitment to clean energy. The National Biofuel Policy was comprehensively amended in 2018 to include more feedstocks for ethanol production. It advanced the target of 20 per cent ethanol blending in petrol from 2030 to 2025 to align with India’s vision of energy self-reliance.
This amended policy also aimed to promote the production of biofuels under the Make in India programme by including units located in Special Economic Zones and Export Oriented Units. It allowed for the controlled export of biofuels and introduced critical administrative reforms, such as restructuring the National Biofuel Coordination Committee to ensure dynamic implementation.
A detailed roadmap was formulated to guide ethanol blending. The government ensured favourable procurement pricing under the Ethanol Blended Petrol (EBP) Programme. The Goods and Services Tax on ethanol for blending was reduced to five per cent, making it financially attractive for producers and consumers alike. Changes were also made to the Industries (Development and Regulation) Act, 1951, to facilitate the free Inter-State movement of ethanol, removing bureaucratic bottlenecks. A dedicated interest subvention scheme was introduced to expand ethanol production capacity by supporting the financial needs of distillers and entrepreneurs.
From Targets to Tangible Results
The results of these initiatives have been outstanding. Ethanol blending increased from 188 crore litres in 2018-19 to more than 700 crore litres in 2023-24. The blending percentage rose from five per cent to approximately 14.6 per cent during the same period. The initial target was not only achieved ahead of schedule but was followed by an ambitious target of 20 per cent blending by 2025. As of January 2025, India has already achieved around 19 per cent blending and is on track to reach 20 per cent blending ahead of the October target date.
The implementation of the E20 programme is expected to save around 4 billion USD annually in crude oil imports. More importantly, this success has already led to a crude oil substitution of about 193 lakh metric tonnes and saved foreign exchange worth over Rs1.13 lakh crore in the last decade.
Strengthening the Rural Economy
One of the most transformative effects of the ethanol push has been on rural India. Farmers are now seeing ethanol production as a new income avenue. Crops such as sugarcane, maize, and agricultural residues are being utilised not just for food but also for fuel. The increased demand has led to massive investments in distilleries and agro-processing units, generating rural employment and reducing migration.
Between 2014 and 2024, Rs 87,558 crore has been disbursed to farmers, while distillers have been paid Rs 1.45 lakh crore. The “Pradhan Mantri – Jaiv Indhan – Vatavaran Anukool fasal awashesh Nivaran Yojana”, shortly called PM-JI-VAN Yojana, modified in August 2024 and extended till 2029, now includes advanced biofuels made from agricultural waste, forestry residues, Syngas, and algae. This has further strengthened the agro-economy and promoted the idea of a circular economy in rural areas.
Health and Environmental Benefits
The ethanol revolution is not just about economic gains; it is a step forward in improving public health and environmental sustainability. Vehicular emissions are a major contributor to urban air pollution, which causes respiratory diseases and impacts quality of life. By blending ethanol with petrol, India is significantly reducing carbon emissions and urban pollution. It is a proactive measure that addresses both climate change and public health concerns in India’s rapidly growing cities.
The Biofuel Alliance
India’s biofuel success has not gone unnoticed on the global stage. During its G20 presidency, India led the formation of the Global Biofuels Alliance (GBA). The Alliance now includes 28 countries and 12 international organisations. It aims to transform waste into wealth, foster international cooperation, and establish global standards for biofuel development. This is a monumental diplomatic and environmental achievement that underscores India’s leadership in clean energy.
Achievements under PM Modi
The ethanol revolution is part of a broader, holistic green energy strategy spearheaded by Prime Minister Modi. India has increased its solar power capacity 32 times, becoming the third-largest solar power producer in the world. The country’s clean energy capacity has grown from 76.38 GW in 2014 to 228.28 GW in 2025, making it the fourth-largest in the world. The Bhadla Solar Park in Rajasthan is now the world’s largest solar park with a capacity of 2,245 MW.
Under the UJALA scheme, 36.87 crore LED bulbs have been distributed, resulting in energy savings and a major reduction in CO2 emissions. PM-KUSUM is solarising 49 lakh agricultural pumps, further strengthening India’s commitment to clean agriculture.
The GOBARdhan scheme, launched under the Swachh Bharat Mission, is converting cattle dung and agricultural waste into biogas and organic manure. It is empowering gram panchayats and rural entrepreneurs while supporting environmental sustainability.
India has also made remarkable progress in conservation. The number of Ramsar sites has increased from 26 in 2014 to 85 in 2025. Thirteen beaches in India have received the prestigious Blue Flag certification. The village of Palli in Jammu and Kashmir has been declared India’s first carbon-neutral panchayat. The “Ek Ped Maa Ke Naam” campaign led to the planting of over 142 crore trees, reflecting the Modi government’s commitment to environmental stewardship.
A Vision Realised, A Future Secured
The ethanol revolution in India is a shining example of what determined leadership and clear vision can achieve. What began under Atal Bihari Vajpayee as a promising idea lay dormant for years until Prime Minister Narendra Modi reignited the mission with full force and national purpose. Today, ethanol is not just fuel; it is a symbol of self-reliance, rural empowerment, environmental commitment, and national pride.
The world is now looking at India not as a follower but as a leader in clean energy. With bold steps, structured policies, and unwavering determination, the Modi government has transformed India’s energy story from vulnerability to strength, from dependence to innovation. This is New India, powered by the spirit of sustainability and led by a government that believes in delivering for today while securing for tomorrow.
(The writer is National Coordinator of Digital Library, Library & Documentation, BJP. View are personal)
This article has been republished from The Daily Pioneer.