Although there will be more ethanol in petrol, costs won't decrease.

To encourage more ethanol-to-diesel and vegetable oil blends, the federal government has extended the exemption from excise duty on biofuels.

With a view to boosting ethanol-blend petrol, the Ministry of Finance has stated that excise duty on 12% to 15% ethanol-blend petrol would no longer be assessed, as opposed to the present exemption ceiling of 10%. For diesel, 20% of the alkaline esters of long-chain fatty acids derived from vegetable oil will be free from excise duty.

Oil marketing firms are losing money on petrol sales as a result of the high price of crude oil. To provide them with some respite, the excise duty exemption ceiling has been extended. Only the amount of ethanol will grow as a result of the government's decision, not the price of petrol and diesel.

In some areas of the nation starting in April of next year, the government intends to blend 20% ethanol into petrol, and in the remaining portions starting in 2025–2026.

India met its goal of blending 10% ethanol into petrol in June, five months ahead of schedule, while the rate was barely 1.5% in 2014. Before the April 2023 deadline, petrol containing 20% ethanol could be offered at a few chosen gas stations nationwide.

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