How India can kick the West Asian oil habit

Increasing the use of alternative fuels like ethanol could be one way out

- S DINAKAR

Refueling a car at a petrol station.

India's heavy dependence on energy supplies from West Asia was exposed last week after the US and Israel launched an attack on Iran, which has spiralled into an all-out war engulfing the entire region.

New Delhi depends on West Asia for over half its oil needs. After the crisis, India was left with around 33 days of crude oil stocks and 25 days of transport fuel stocks, according to government data.

There are two ways for a country to improve its energy security. Either it builds strategic storage like in the US, EU, China and Japan, or it deploys alternative fuels such as ethanol, green hydrogen and biogas. These fuels offer energy security, help decarbonize industries and divert billions of dollars paid to foreign nations towards farmers and local businesses.

India’s strategic petroleum reserve (SPR) covers only 7-9 days of demand for a country that’s the world’s third biggest oil consumer. Plans to add another 45 million barrels to the existing 39 million barrels — still a fraction of China’s SPRs for instance — have been delayed by years because of land acquisition issues and illegal mining at the proposed SPR site, as seen in Odisha.

The easiest fix for New Delhi is ethanol, a biofuel made from processing sugarcane, molasses, broken rice or maize, that is mixed with petrol or diesel. India achieved 20 per cent ethanol blending in petrol five years earlier than a targeted 2030, helping it divert the payouts to farmers and domestic distillers instead of foreign oil producers.