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Explainer: How ethanol blending in fuel can benefit Indian farmers

India

India just reached a 20% ethanol blend in petrol as of March 2025—up from 14.6% the year before—and is aiming for 30% by 2030.
This shift isn't just about cutting oil imports; it's also opening up fresh earning opportunities for farmers who supply crops like sugarcane for ethanol.

The program's impact and environmental benefits

Since starting in 2014, the program has saved India ₹1.36 lakh crore in foreign exchange and helped reduce crude oil use.
Ethanol burns cleaner than petrol—emitting about 65% less CO2—which is great for the environment.
Still, there are real concerns about water use and food security, so the government is now exploring ways to make ethanol from things like farm waste instead of just sugarcane.