As rising global crude oil prices put pressure on India’s fuel economy, Grain Ethanol Manufacturers Association (GEMA) President C.K. Jain said ethanol blending has emerged as one of India’s strongest tools to reduce import dependence, and it will help to reduce the petrol prices by up to Rs 20 per litre.

While speaking with Times Now Digital, Jain said the ongoingglobal crude oil volatilityamid tensions in West Asia has strengthened the case for higher ethanol blending in India.

Explaining the rationale behind Rs 20 per litre cut in the petrol prices, Jain cited an example of Brazil.

"In Brazil, they have got two dispensing. Every petrol pump has two nozzles. One is a base petrol, which today in India is E20, while another dispensing nozzle will be E85 or E100. Similarly in case of India, when we go to E100, it doesn't attract Value Added Tax (VAT)," he said.

"E100 doesn't have the 70% fossil fuel hydrocarbon, so it is out of VAT. When it is out of VAT, the difference comes Rs 20 per liter as the state charges VAT of about Rs 18 to 20 rupees per liter out of Rs 100. So differential will come," he explained.

GEMA President claimed oil marketing companies are currently absorbing major losses due to rising crude prices.

He said the petrol prices come out with components like import taxes, processing cost and others.

"Government is already subsidizing the petrol prices and under the current crude oil crisis, OMCs are losing not less than Rs 1700 crore per day. This is already subsidized. The actual petrol price today should be around Rs 120 per litre, but consumers are paying about Rs 100 because of subsidies and price controls,” Jain said.

GEMA President also shared with Times Now Digital that oil marketing companies are planning to introduce dual-dispensing ethanol pumps at around 100 petrol stations initially, allowing consumers to choose between higher ethanol blends and conventional petrol.

"OMCs have already decided that they are going to do that on 100 petrol pumps this year. One will dispense E85, another E20. Then you choose depending upon the price, and what do you want to run. This will be customer choice," he said.

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