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Controversy continues over ethanol fuel, this neighboring country of India refuses to buy E20 petrol

July 4, 2026 by Uma Shankar

Nowadays, there are many complaints in the media and social media in India that E20 petrol (which contains 20% ethanol) is causing harm to vehicles. According to people, due to this the parts of their vehicle are getting damaged and the mileage has also reduced considerably. Still, customers have no choice. All the big companies like Indian Oil (IOCL), Bharat Petroleum (BPCL), Hindustan Petroleum (HPCL) and Jio-bp are now selling only E20 as normal petrol. That means whether you want it or not, you have to fill only this E20 petrol.

India’s Ministry of Petroleum and Natural Gas has ordered that with a few exceptions, only E20 should be supplied as standard petrol across the country. Now the big question is whether Bhutan is also importing ethanol-blended petrol, because IOCL, BPCL and HPCL mainly supply fuel to Bhutan. The people of Bhutan put this question before the Department of Trade and asked whether our lab in Chunzom is testing ethanol.

Bhutan did not accept petrol

Indian Oil Marketing Companies (OMCs) are offering to supply E20 petrol to Bhutan, but Bhutan has not yet accepted it. The department said that unlike normal MS (petrol), ethanol-blended petrol contains hydroxyl (-OH) group, which makes its nature hygroscopic (moisture absorbing). That means it easily absorbs water and mixes with it. Once water mixes with ethanol-blended fuel, the water and fuel cannot be easily separated, potentially affecting fuel quality and vehicle performance.

“Additionally, given the current condition and quality of many underground storage tanks held by fuel dealers, the import and handling of ethanol-blended fuel may pose challenges in terms of maintaining fuel quality and preventing adulteration.”

Bhutan requested to give first information

The Department said that in view of these concerns, during the technical meetings, the Public Sector Undertakings (PSUs)/OMCs of India were requested to continue the supply of generic MS to Bhutan as long as generic MS is available in the Indian market. Even if India moves to higher levels of ethanol blending or completely switches to ethanol-blended petrol, Bhutan has requested that it be informed in advance.

This will provide sufficient time to fuel dealers to work with PSU/OMC to upgrade the underground storage tank infrastructure and associated fuel handling systems to ensure leak-proof and seepage-free storage facilities to handle ethanol-blended fuel safely.

About Uma Shankar

Uma Shankar writes about finance, business, and investment topics. He simplifies complex subjects like stock market, banking, tax, and cryptocurrency to help readers make informed financial decisions. Data-driven reporting is his strength.

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