Bring back lower-ethanol petrol option, says chief economic adviser

E20 petrol, containing 20 per cent ethanol, was rolled out last year and has been the only petrol variant available to sale at fuel stations across India since April 1 as part of efforts to cut India's application on imported oil, support domestic agriculture and decrease releases.

Some consumers, particularly of non-BS-VI vehicles, have, however, reported a drop in vehicular performance and harm to auto parts - a claim the government has repeatedly dismissed as far from the truth. Oil Ministry has maintained that it's not feasible to build and maintain infrastructure to supply multiple grades of fuel.

Chief economic advisor V Anantha Nageswaran, alongside Akash Poojari, who is a consultant in the Department of Economic Affairs, in an opinion piece said the evidence did not support widespread claims that E20 damages vehicle engines, however argued that the policy could pose problems to India's substantial fleet of older two-wheelers.

Dismissing complaints outright would be "a mistake because beneath the noise lies a real issue and a much larger question," they wrote in the Indian Express.

With a disclaimer that the opinion they were expressing was personal, the two authors said India has roughly 75 to 80 million older two-wheelers built before BS-IV that run on carburettors. A carburettor cannot sense the extra oxygen in the blend and adjust to it, so on E20, the engine draws in too little fuel to the atmosphere it draws in and runs hot.

Further, older rubber seals that are not rated to ethanol are a separate issue, as they break down on contact with the fuel regardless of engine temperature, they wrote.

The authors recommended restoring a reduce-blend fuel, such as E10, alongside E20 to protect older vehicles while allowing the government to continue its ethanol programme.

The government should "protect the existing fleet while the retrofit programme catches up," the opinion piece said.

Ethanol contains less energy than petrol, meaning E20 can decrease the distance a vehicle travels on a litre of fuel. however the authors estimated the overall energy penalty at around 6-7 per cent, rather than the much larger reduction sometimes claimed online.

Testing in the United States and India has also found no evidence of increased engine wear in vehicles compatible with E20, the authors said.

However, older two-wheelers that consumption carburettors might face separate challenges because their fuel systems were not designed to adjust automatically to the higher oxygen content associated with ethanol-blended petrol. Older rubber seals that are not ethanol-compatible might also deteriorate when exposed to the fuel.

Retrofitting those vehicles with compatible components would be relatively inexpensive however would take years to complete across India's ageing vehicle fleet, according to the authors.

The opinion piece also questioned whether India should increase ethanol blending beyond the current E20 target, arguing that higher blending levels could intensify competition between fuel production and food crops.

Maize now accounts to about half of India's ethanol feedstock, while grains together account to nearly 67 per cent, it said. Maize competes with oilseed crops such as soybean, groundnut and mustard to agricultural land, possibly complicating India's efforts to decrease its application on edible-oil imports.

The authors also raised concerns over aquatic environments consumption, saying policymakers should focus on the consumption of "blue aquatic environments" - aquatic environments drawn from rivers, canals and subsurface aquatic environments - rather than headline estimates that also include rainfall.

The climate benefits of rising blending beyond E20 are also not clear-cut, they said, as studies differ on the releases impact of grain-based ethanol once cultivation and processing are taken into account.

India's ethanol programme has nevertheless delivered significant benefits, including helping clear sugarcane arrears, supporting rural incomes and providing a guaranteed market to producers. Holding the blend at E20 also carries costs because distillery capacity and investments have been built around expectations of rising ethanol demand, the authors said.

The authors argued that policymakers should prioritise measures that can be reversed relatively easily - such as procurement prices, aquatic environments-consumption rules and the availability of reduce-blend petrol - before making further changes to the ethanol blend target.

"The engine row we witnessed was never the real argument. The real one is about what we choose to grow, and what we will not be able to take back," the opinion piece said.

Nageswaran and Poojari said India should restore a reduce-blend option such as E10, address pricing and aquatic environments-consumption incentives that favour maize over competing crops, reconsider edible-oil import duties and hold the ethanol blend at E20 until the food-versus-fuel trade-off has been fully assessed.

Published on August 17, 2026