Ethanol Industry Asks for E-20+ Roadmap, Tax Cuts

New Delhi, Oct 14 (PTI) The country's sugar and biofuel industry bodies on Tuesday urged the government to establish a national ethanol mobility roadmap beyond the current E-20 blending target and reduce taxes on flex-fuel vehicles to sustain the country's biofuel push.

The Indian Sugar & Bio-Energy Manufacturers Association (ISMA) and Indian Federation of Green Energy (IFGE) sought GST rationalisation on flex-fuel vehicles (FFVs) and smart hybrid vehicles, along with consumer incentives similar to those offered for electric vehicles under the FAME scheme.

The appeal comes after India achieved its E-20 ethanol blending target - mixing 20 per cent ethanol with petrol - five years ahead of schedule, ISMA said in a statement.

"India's sugar sector has risen to the challenge and delivered on its ethanol promise ahead of schedule," ISMA Director General Deepak Ballani said adding the industry believes that sustaining this ethanol revolution now depends on policy continuity.

The ethanol industry has offered 17.76 billion litres against oil marketing companies' requirement of 10.50 billion litres, demonstrating readiness to support 27 per cent ethanol blending, Ballani said.

Without a defined roadmap beyond E-20, production capacities could remain underutilised, leading to idle investments and reduced mill revenues, he added.

The sugar industry has invested about Rs 40,000 crore to create ethanol production capacity exceeding 900 crore litres per annum, ISMA said.

The industry also flagged financial pressures from stagnant ethanol procurement prices from B-heavy molasses and sugarcane juice over the past three years.

IFGE President Pramod Chaudhari said India must declare a National Ethanol Mobility Roadmap 2030 with clear targets beyond E-20, integrating vehicle adaptation norms and promoting advanced biofuels.

The current 43 per cent GST on FFVs and smart hybrids remains a "major disincentive" compared to the 5 per cent rate on electric vehicles, the groups said.

With appropriate policy support for FFVs, India could reduce its annual oil import bill by Rs Rs 50,000–75,000 crore, they added.