In the current ethanol supply year, which started in October, India plans to have 8.5% ethanol-blending with gasoline. This would be raised to 10% by mixing in 4 billion litres of ethanol by 2022, the statement said.
"To achieve 20% blending by 2025, and to meet the requirement of the chemical and other sectors, about 12 billion litres of alcohol/ethanol would be required," the government said on Thursday.
The sugar industry will divert 6 million tonnes of surplus sugar to produce 7 billion litres of the ethanol needed, the government added, while the other 5 billion litres of ethanol will be produced from excess grain.
Last month the cabinet announced a scheme to attract about 400 billion rupees in private investment to expand India's capacity to produce ethanol from sugar and grains.
Moves to increase ethanol content are also aimed at providing an alternate source of revenue for sugar mills as India will not be entitled to extend sugar export subsidies beyond 2023, under the World Trade Organization Agreement on Agriculture.
(Reporting by Aftab Ahmed)
(Only the headline and picture of this report may have been reworked by the Business Standard staff; the rest of the content is auto-generated from a syndicated feed.)
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