Supreme Court Maintains Status Quo on India Ethanol Allocations

The Supreme Court of India ordered a status quo on ethanol supply allocations for the 2025-26 supply year on June 30, 2026. The ruling follows a petition by Bharat Petroleum Corporation Limited (BPCL) challenging a Karnataka High Court order that required oil marketing companies to reconsider a request for increased allocations from VINP Distilleries and Sugars Pvt. Ltd.

During the proceedings, Attorney General R. Venkataramani argued that altering finalized contracts—which covered 378 suppliers and 1,050 crore litres as of October 2025—would destabilize national policy and trigger widespread litigation. While initial media reports claimed the government described the 20% ethanol blending (E20) program as an "ongoing experiment" with results expected by 2027, the government later issued a firm denial. The Office of the Attorney General for India stated these reports were "completely false," clarifying that the E20 program is a national policy initiative rather than a trial.

The Supreme Court issued notices to the Union government and 23 ethanol manufacturers, maintaining current allocations until a final decision is reached. The government has requested the court to consolidate similar petitions from various High Courts to prevent conflicting judicial decisions. Separately, the Automotive Research Association of India has begun testing E25 petrol to evaluate performance on compliant vehicles, with a final report expected by late 2027.