Conflict of Interest in E20 Rollout; Panjab Assembly Passes Resolution

August

2026

The Society of Indian Automobile Manufacturers (SIAM) has flagged rising concerns over the quality of E20 (20% ethanol blended) petrol in a statement on 28 Jul. SIAM warned that contamination at fuel pumps was causing an increase in failures of critical engine and exhaust components. The Union Ministry of Petroleum and Natural Gas (MoPNG) said oil marketing companies regularly monitor fuel quality. MoPNG said, 'It is hereby clarified that fuel quality is monitored on a regular basis by Oil Marketing Companies (OMCs). In addition to the advanced and elaborate testing protocols already in place, further checks have been instituted, including water ingress testing 8–12 times a day in over 87K outlets.' However, on 5 Aug, SIAM said it had 'withdrawn' the letter. Nationalized OMCs—Indian Oil, Bharat Petroleum, and Hindustan Petroleum—have rejected claims of widespread contamination in E20 petrol, saying an India-wide testing exercise found no evidence to support reports of elevated chloride and moisture levels. Earlier, in June, during a Supreme Court of India hearing, India's Attorney General R. Venkataramani referred to the ethanol blending initiative as an 'ongoing experiment'. This was an attempt to package the move to force E20 petrol on 230M petrol vehicle customers while providing no options for unblended petrol. If the policy is indeed an 'experiment', then the government did not obtain customers’ consent and does not provide any compensation for engine damage. Data shows producing one liter of ethanol from sugarcane, maize, and rice needs 3,630 liters (L) of water, 4,670 L, and 10,790 L respectively. The union government has so far approved USD 491M in interest subsidies for eligible ethanol projects. Interestingly, Union Minister of Road Transport and Highways, Nitin Gadkari has been promoting ethanol vigorously while his son Nikhil Gadkari is Managing Director of CIAN Industries which produces ethanol. CIAN's revenue in Financial Year (FY) 2021–22 was USD 26M but grew to USD 235M in FY 2025–26, signaling a 9-fold growth. Meanwhile, with customers reluctant to buy old cars, the E20 petrol rollout has hit Panjab's USD 105M pre-owned automobile market badly. Panjab's Legislative Assembly has passed a resolution urging the union government to review and suspend the mandatory implementation of E20 petrol for vehicles not designed or certified to run on the fuel (earlier coverage).