India’s ethanol blending programme has emerged as a global example of how government policies can develop both demand and supply in the bioeconomy sector, according to the World Economic Forum (WEF).
In its Bioeconomy Policy Index report, prepared in collaboration with Capgemini Invent, the WEF highlighted India’s Ethanol Blended Petrol Programme as a model for linking production incentives with assured market demand. The programme helped India achieve 20% ethanol blending in petrol five years ahead of its original 2030 target.
The report analysed 935 bioeconomy policy instruments across seven economies: India, China, Japan, the United Kingdom, Germany, the United States and Brazil. It called on governments to develop policy frameworks that create demand, address barriers to commercialisation and measure outcomes from the beginning.
India’s Policy Framework for Bioeconomy
The WEF noted that India’s bioeconomy is supported by national initiatives, including the Biotechnology for Economy, Environment and Employment (BioE3) Policy.
Around 48% of India’s bioeconomy policy instruments focus on enabling conditions such as research and development, tax incentives and institutional capacity. The country also recorded the highest combined share of financial incentives, infrastructure and capability development, and regulatory and legal measures at around 76%.
The UK followed with 69%, while Brazil accounted for 68% and the US 67%.
Ethanol Programme Connects Production with Demand
The WEF identified the Ethanol Blended Petrol Programme as India’s clearest example of coordinated demand- and supply-side policy support.
The government supported the expansion of ethanol production through concessional financing for new distillery capacity under the Ethanol Interest Subvention Scheme. At the same time, blending mandates created a market for the additional production.
This combination helped India achieve the 20% ethanol blending target five years ahead of the original 2030 deadline.
The Ministry of Petroleum and Natural Gas has reported cumulative carbon dioxide emissions savings of 95.2 million tonnes through the programme. However, the WEF noted that this figure has not been independently evaluated.
WEF Calls for Stronger Outcome Measurement
While highlighting India’s policy framework, the report also pointed to the need for better measurement of results. Of the 935 policy instruments assessed across the seven economies, only 128 had qualifying evidence of outcomes. India had seven such instruments out of the 86 assessed.
The WEF recommended that governments establish clear targets, baselines and verification systems when designing bioeconomy policies. It also called for common reporting standards to compare results across sectors and countries.
The report urged policymakers to create commercially viable markets through procurement commitments, offtake guarantees and mechanisms that provide revenue certainty to producers.
It said policy support should translate into measurable outcomes, including emissions reductions, job creation, private investment, company formation and wider market adoption.
