Image Credit: https://www.pmindia.gov.in/
From Brazil to Bharat: Why India’s E20 Gamble is Built on Half-Truths
India’s government has hailed the rollout of E20 petrol — a blend of 20 percent ethanol with petrol — as a “historic step” towards energy independence and climate responsibility. But on the ground, the reality is less inspiring. Drivers are confused, manufacturers have made U-turns in their statements, and complaints about mileage and performance are surfacing. The uncomfortable truth is that India’s E20 gamble looks more like a rushed copy of Brazil’s ethanol story, executed without the groundwork.
Brazil’s ethanol success story was decades in the making. Starting in the 1970s, Brazil systematically invested in flex-fuel technology, infrastructure, and consumer education. Today, Brazilian cars are engineered to run on anything from E20 to E100, while fueling stations are equipped and consumers fully adapted. The system works because vehicles, fuel, and users were aligned from the beginning.
India, by contrast, is attempting to leapfrog into E20 without the same preparation. The geopolitical context looms large. With 80–85 percent of crude oil imported, even the smallest spike in global prices shakes the Indian economy. U.S. sanctions over Russian oil imports have pushed New Delhi to find buffers. Blending ethanol appears to be one such hedge. By cutting crude demand by an estimated 86 million barrels annually, E20 could save India around ₹30,000–35,000 crore every year. If all the ethanol needed is sourced domestically, those funds cycle back into the rural economy. On paper, it seems like a masterstroke. In practice, India lacks the production capacity, flex-fuel readiness, and distribution framework to make this transition seamless.
The burden is falling squarely on consumers. Unlike Brazil, Indian automakers do not produce flex-fuel cars. Vehicles made before April 2023 are largely E10 compatible at best. Cars produced between April 2023 and March 2025 are “E20 material compliant” — resistant to ethanol’s corrosive effects, but still optimized for E10 fuel. Only vehicles rolling out from April 2025 will be fully E20 compliant. This leaves millions of cars and two-wheelers on Indian roads exposed to efficiency drops, performance issues, and long-term maintenance risks. Drivers are already reporting reduced mileage and rougher engine runs. Ethanol’s lower calorific value means more fuel per kilometre, eroding the supposed savings from reduced imports. The result: the government’s projected ₹30,000–35,000 crore cushion risks being offset by higher costs borne by motorists.
The political theatre is equally visible. E20 is marketed as green policy and farmer empowerment, but the urgency and timing make it clear this is also about shielding India’s economy from sanctions fallout. The reality is that while India can handle E10 self-sufficiently, E20 stretches ethanol capacity and risks food price pressures by diverting sugar and grains. Automakers, too, have been placed in an awkward spot: first warning against E20 use, then issuing “clarifications” under clear pressure. The messaging smells more of political arm-twisting than technical consensus.
Brazil’s ethanol journey worked because it was methodical, gradual, and consumer-ready. India’s approach feels rushed and brittle. Without flex-fuel cars, transparent pricing, or phased execution, E20 risks turning into a consumer burden rather than a national triumph.
Darshan Walawalkar, Partner at Statscope India:
“The government has rushed into E20 without securing the basics. A responsible transition would have meant keeping E10 available for older vehicles while mandating E20 only for new, compatible models. Instead, every driver is being forced into a fuel regime their car may not be designed for — that’s not policy execution, that’s abdication of responsibility.”
Arun Durairajan, Partner at Statscope India:
“What puzzles us even more is pricing. If ethanol-blended petrol is cheaper to produce, logic suggests E20 should retail at a lower price than E10. Yet, petrol prices remain static, denying consumers the very benefit this policy claims to deliver. Without transparent pricing and phased execution, the E20 rollout risks becoming an exercise in optics rather than substance.”
