The Minister for Road Transport and Highways, Nitin Gadkari, on Monday urged the Finance Ministry and its counterparts in the states to reduce the GST on flex fuel vehicles to 12 per cent.
Addressing IFGE’s India Bio-Energy & Tech Expo, Gadkari said flex fuel engines are the ultimate goal as they will not only reduce emissions, but also help trim the country’s annual fossil fuel import bill of around ₹22 lakh crore.
“I have urged the Finance Minister to reduce GST on flex fuel vehicles. The Finance Minister also assured me that all efforts will be made to convince state finance ministers. I have also asked Maharashtra’s Finance Minister to attend the GST Council meeting and propose the reduction,” he added.
At present, 28 per cent GST is levied on internal combustion engine (ICE) vehicles and hybrids, and 5 per cent on electric vehicles (EVs).
“If we can have good technology for bio-fuel, our exports will grow by 10-20 per cent, pollution is a big concern world over,” he said.
Minister of Petroleum & Natural Gas, H. S. Puri, who also graced the occasion, emphasised that bioenergy is increasingly becoming a crucial alternative to fossil fuels, offering both environmental benefits and economic opportunities, particularly in rural areas.
One of the standout achievements was the success of India’s ethanol blending programme.
“The rapid rise in ethanol blending percentage from 1.53 per cent in 2014 to 15 per cent in 2024, has encouraged the government to set an ambitious target of achieving 20 per cent blending by 2025,” he added.
Ethanol blending has resulted in a saving of ₹99,014 crore in foreign exchange over the past decade, besides reducing CO2 emissions by 519 lakh tonnes, and substituting 173 lakh tonnes of crude oil.
“Further, the programme has had a considerable economic impact, with Oil Marketing Companies (OMCs) disbursing ₹1,45,930 crore to distillers and ₹87,558 crore to farmers,” the Minister said.
Puri also highlighted the widespread availability of E20 fuel, which is now offered at over 15,600 retail outlets across India. He commended the Pradhan Mantri JI-VAN Yojana for its role in providing financial support to advanced biofuel projects, which is crucial for developing a sustainable ethanol production ecosystem.