Answer: On the sidelines of 2023 - G20 summit in New Delhi, impetus to the production and use of biofuels was given by launching Global Biofuels Alliance (GBA), which would attempt to bring countries together to codevelop, accelerate technological advances in production processes, and advocate for the use of biofuels.

Significance of global biofuel alliance:

• Energy security and promoting Independent national policy: More than 85% of crude oil demand of India is met by import and this makes India vulnerable to supply side shocks like oil price rise during Gulf war of 1970s and recent Russia-Ukraine war, threatening energy security. So, by reducing the import of crude oil by blending crude oil with bio fuels like ethanol, India can ensure energy security.
• Reduction of Fiscal deficit and inflation: India imported more than $120bn worth of crude oil in the financial year 2021-22, which is subject to increase in the coming years due to rising demand. This puts a financial stress leading to current account deficit and fiscal deficit.
• Increased Technology Transfers for India: Through the GBA, India gains access to advanced technologies and international climate funds, expediting advancements in the compressed biogas sector and third-generation ethanol plant capacities. This transfer of knowledge and resources can help India accelerate its transition to cleaner energy sources.
• Leadership role in climate change mitigation initiatives: Since ethanol blended fuels burn better with less emissions along with reducing usage of fossil fuels. Thus taking steps towards net carbon neutrality targets of India.
  • For example, According to the NITI Aayog report titled ‘Roadmap for Ethanol blending in India 2020-25’, carbon monoxide emissions were 50% lower in two-wheelers and 30% lower in four-wheelers after ethanol blending.
• Employment creation and alternate source of income for farmers: Investments in Biofuel sectors will create a lot of employment opportunities for youth. It also is an alternate source of income for farmers especially when they are getting low sugarcane prices.Thus biofuel production by sugarcane can help farmers earn remunerative prices and help in doubling farm income.

Steps taken by India to promote biofuels production and consumption:

• The Ethanol blending programme aims to reach the target of 20% blending of petrol by 2025-26.
• The Administered pricing mechanism has been re-introduced. Under the APM, the government sets a fixed price for ethanol that is used for blending with petrol. Thus ensuring fair price for their product, and to encourage the use of ethanol as a renewable fuel.
• Amendment to Industries (Development & Regulation) Act, 1951 which legislates exclusive control of denatured ethanol by the Central Government for smooth movement of ethanol across the country.
• The Pradhan Mantri JI-VAN Yojana was launched in 2019 to promote the use of biofuels and encourage the production of advanced biofuels, including ethanol from agricultural residues, municipal solid waste, and other waste materials.
• The National Biofuels Policy was launched in 2018 to promote the production and use of biofuels, including ethanol. The policy aims to promote sustainable biofuels production, reduce dependence on imported crude oil, and create new job opportunities in the biofuels sector.
• Reduction in Goods & Service Tax (GST) on ethanol meant for Ethanol blending Programme from 18% to 5% to boost the demand of ethanol in the market.

The launch of Global Biofuels initiatives to promote biofuels production and consumption is a step in the right direction to promote climate friendly, less emissions intensive technology along with promoting growth and development. However, care should be taken to promote the 2nd generation biofuels, which are produced from agricultural waste, used cooking oil and processed animal residues , thereby ensuring food security in India.