New Delhi: The central government is working on a dedicated policy to make E85 — petrol blended with up to 85 percent ethanol — cheap enough for mass adoption, Union Petroleum and Natural Gas Minister Hardeep Singh Puri said on Wednesday.He was speaking at an event where Hero MotoCorp rolled out India's first flex-fuel motorcycles capable of running on any ethanol blend between E20 and E85.
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"We are actively examining a supportive policy for accelerated affordable adoption of E85 fuel," Puri said at the launch in New Delhi, which was also attended by Union Road Transport and Highways Minister Nitin Gadkari. He congratulated Hero MotoCorp for what he called a pioneering step in the national journey.
The two models unveiled — the Splendor+ and HF Deluxe flex-fuel variants — use internal combustion engines fitted with upgraded fuel systems that accept any petrol-ethanol mix from E20 (20 percent ethanol) up to E85. Puri said the rollout marked India's entry into mass-market flex-fuel mobility built around Aatmanirbhar (self-reliant) vehicles, a sentiment he captured in the slogan "भारत की बाइक, भारत का ईंधन!" (India's bike, India's fuel).
Puri said government studies indicate that if E85 is priced suitably below E20, buyers can recoup the cost of the vehicle within about three years through fuel savings. He added that the government is weighing pricing support and targeted incentives to make adoption affordable and establish India as a global leader in flex-fuel mobility.
The minister described the launch as a defining moment for both mobility and India's ethanol-blending drive, which has climbed from 1.5 percent in 2014 to 20 percent today. With an active fleet of more than 300 million two-wheelers — among the largest such ecosystems anywhere — he said flex-fuel technology could reshape Indian mobility at an unmatched scale. Puri framed it as one element of a future mobility mix that would also draw on EVs, biofuels, hydrogen and renewables, tailored to Indian conditions.
Puri noted that India still imports nearly 88.5 percent of its crude oil, leaving the economy and its energy security exposed to geopolitical disruptions. He said the ethanol-blending programme had, since Ethanol Supply Year (ESY) 2014-15, saved Rs 1.84 lakh crore in foreign exchange, substituted 302 lakh metric tonnes of crude oil and cut carbon dioxide emissions by 909 lakh metric tonnes, while delivering Rs 1.58 lakh crore in additional earnings to farmers. "Then our farmers who are now annadata, will become urjadaata," he said, pointing to the shift of cultivators from being the nation's food providers (annadata) to energy providers (urjadata).
Puri said that even if just 1 percent of annual petrol vehicle sales in ESY 2026-27 moved to flex-fuel, it would generate demand for 4 crore litres of ethanol. That, he said, would translate into roughly Rs 266 crore in payments to distilleries, foreign-exchange savings of about Rs 195 crore, a reduction of around 0.28 lakh metric tonnes in crude oil imports and a net cut of nearly 0.86 lakh metric tonnes of CO2, with about Rs 160 crore flowing directly to farmers instead of leaving the country for oil purchases. The impact, he said, would turn transformational as the technology scaled across the two-wheeler fleet.
Puri argued that flex-fuel vehicles carry lower manufacturing costs, need minimal new infrastructure and can be deployed far faster than an EV charging network — by his estimate, 10 to 15 times quicker. Electric vehicles, he said, remain heavily reliant on imported battery components and carry sizeable upstream emissions, whereas flex-fuel vehicles run on homegrown biofuels, avoid battery-related emissions and feed farm incomes directly, making them fully Aatmanirbhar with a smaller carbon footprint. He said the E20 rollout had followed extensive testing by SIAM, ARAI, IOCL and vehicle makers, and cited Brazil as evidence that flex-fuel mobility is proven, scalable and reliable.
Gadkari flagged the tax treatment of higher ethanol blends as a hurdle, noting that fuel blended with more than 20 percent ethanol attracts 18 percent GST, against just 5 percent on E20. "The finance minister assured me that she will discuss this issue of higher taxes on E30 and above with state governments in the GST Council meeting," Gadkari said. He maintained that ethanol is a superior rather than inferior fuel, and that steering agriculture towards energy and power is the way forward. Gadkari also said his ministry is exploring building concrete roads.
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Separately, the Ministry of Road Transport and Highways has proposed amendments to vehicle emission norms to make room for higher ethanol blends and other alternative fuels. The draft changes to the Central Motor Vehicles Rules, 1989 would broaden the permitted fuel range to include E85, E100 (enabling vehicles to run on nearly pure ethanol), B100 biodiesel and hydrogen-CNG blends, clearing the way for flex-fuel and pure-biofuel vehicles across categories. The ethanol used in blending is produced from biomass such as sugarcane, corn and rice, yielding a cleaner-burning fuel that trims crude imports and emissions.