New Delhi | August 4, 2026
The Ministry of Heavy Industries (MHI) has officially clarified that it has not formulated any separate, phased national policy to incentivize flex-fuel vehicles capable of running on petrol blended with more than 20% ethanol (E20).
In an official statement released via the Press Information Bureau, the Ministry further noted that it has not conducted any specific study regarding the relative incentivization of flex-fuel vehicles versus electric vehicles (EVs).
PLI-Auto Scheme: Progress Performance
While highlighting its broader automotive manufacturing initiatives, the Ministry outlined the cumulative performance figures under the national Production Linked Incentive (PLI) Scheme for Automobile & Auto Components (PLI-Auto) as of March 31, 2026:
To strengthen domestic supply chains and local value addition, the PLI-Auto scheme enforces a mandatory Minimum Domestic Value Addition (DVA) of 50%. As of July 28, 2026, 18 approved applicants have successfully secured DVA certification across 155 Advanced Automotive Technology (AAT) products and variants.
Biofuel Policy, Water Sustainability & Agricultural Balances
Addressing the broader context of the Ethanol Blended Petrol (EBP) Programme, the Ministry emphasized a balanced national approach to biofuel feedstocks that safeguards food security, water tables, and farmers’ livelihoods:
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Feedstock Diversification: Under the National Policy on Biofuels, ethanol production draws from diverse feedstocks, including sugarcane, maize, damaged foodgrains, broken rice, surplus grains approved by the National Biofuel Coordination Committee (NBCC), and non-food agricultural waste.
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Crop Diversification & Efficiency: Focus is shifting toward less water-intensive crops like maize, guided by recommendations from a 2024 Ministry of Agriculture Expert Committee. Water conservation is being actively scaled via micro-irrigation initiatives under the Pradhan Mantri Krishi Sinchayee Yojana (PMKSY).
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Zero Liquid Discharge (ZLD): Environmental regulations mandate that molasses-based distilleries with incineration boilers and grain-based distilleries operate as Zero Liquid Discharge units to eliminate liquid effluent runoff and optimize water recycling.
Key Summary
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Issuing Body: Ministry of Heavy Industries (MHI), Government of India
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Publication Date: August 4, 2026
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Key Policies Covered: PLI-Auto Scheme, National Policy on Biofuels & Ethanol Blended Petrol (EBP) Programme
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Domain Focus: Flex-Fuel Policy, Auto Manufacturing PLI, Advanced Automotive Technologies & Sustainable Biofuels
