Archive · 28 Oct 2025
India's Ethanol Industry: Addressing Oversupply and Policy Action
India has greatly expanded its ethanol industry, making fuel from crops.
The Ethanol Blending Programme has saved money and helped the environment.
Now, more ethanol is made than is immediately needed.
IFGE suggests actions like increasing ethanol use in fuel, restricting imports for non-fuel uses, easing environmental rules, and promoting flex-fuel vehicles.
These steps aim to stabilize the market, ensure growth, and support India's clean energy goals and farmers.
India's ethanol production capacity is near 1,700 crore litres.
The Ethanol Blending Programme (EBP) has saved ₹1,44,087 crore in foreign exchange.
The EBP has helped avoid 736 lakh tonnes of CO₂ emissions.
An oversupply of ethanol exists because production growth exceeded current demand.
Policy recommendations include increasing blending levels and expanding ethanol usage.
- Who
- Indian Federation of Green Energy (IFGE)
- What
- The Indian ethanol industry faces a temporary oversupply.
- When
- Present
- Where
- India
- Why
- Oversupply due to production outpacing current blending demand.
- Ethanol Production Capacity
- Nearing 1,700 crore litres
- Foreign Exchange Savings (ESY 2014-15 to 2024-25)
- ₹1,44,087 crore
- Crude Oil Substitution
- 245 lakh metric tonnes
- Farmer Payments (at 20% blending)
- ₹40,000 crore annually
- CO₂ Emission Avoidance
- 736 lakh tonnes
- Countries With Higher Ethanol Blends
- Brazil and the United States (27-30%)
Sources
Addressing the current oversupply scenario in India's ethanol industry – A call for immediate and balanced policy action
Addressing the current oversupply scenario in India's ethanol industry – A call for immediate and balanced policy action
