India rules out concessions to US on ethanol import for fuel blending

India has firmly rejected any concessions or commitments to the US regarding ethanol imports for fuel blending in the ongoing bilateral trade talks, according to the Commerce Department. The department emphasized that India's ethanol procurement and fuel blending policies are solely determined by domestic requirements. This clarification comes amidst discussions over the government's aspiration to make E20, fuel blended with 20 percent ethanol, the default choice at retail outlets.

Critics have questioned the impact on fuel efficiency, compatibility with older vehicles, and consumer choice, while the government maintains that the shift is essential for enhancing energy security and curbing emissions. The Commerce Department explicitly stated that any implication of a policy modification to permit substantial ethanol imports from the US was inaccurate.

It also debunked reports suggesting India was or would be importing large volumes of ethanol from the US for blending with petrol. The statement reiterated that under the Ethanol Blended with Petrol Programme, ethanol for fuel blending is exclusively sourced from domestic producers, with no imports from the US. The India-US interim trade agreement framework, unveiled on February 7, 2026, did not encompass ethanol among the products targeted for tariff reduction or elimination.

As of now, the two nations are still engaged in negotiations for the proposed interim trade agreement. The discussions have become increasingly intricate due to the US Supreme Court's ruling invalidating the Trump administration's reciprocal tariffs, leading the US Trade Representative (USTR) to initiate Section 301 investigations into the trade policies of various countries, including India.