How sustainable is India’s E20 push? | Explained

Opposition leaders such as Rahul Gandhi and Arvind Kejriwal have launched campaigns against E20 saying it harms vehicles and that the government is forcing it on people. Mr. Kejriwal alleged that India has “yielded” to pressure from U.S. President Donald Trump to buy ethanol from the United States.

The government’s target was to produce 10-11 billion litres of ethanol so that 20% of petrol used in transport vehicles could come from ethanol produced in India, with the money being funnelled into the Indian economy rather than becoming a foreign exchange outgo through crude oil imports. Taking advantage of the policy push, India’s distillery capacity has ramped up and is now capable of producing some 18-20 billion litres from some 500 distilleries. For this ethanol year, which runs November to October, the oil companies have contracted to procure some 10.5 billion litres of ethanol.