As India charts its path towards a cleaner automotive future, a significant debate is unfolding between proponents of electric vehicles (EVs) and alternative technologies. Japanese auto giant Toyota Kirloskar Motor has made a strong case for prioritizing ethanol-powered hybrid flex-fuel vehicles, positioning them as a superior and more sustainable bet for the nation.
Toyota's Argument for Ethanol Hybrids
Vikram Gulati, Toyota’s country head and executive vice president for corporate affairs and governance, in an interview with Mint, advocated for government incentives like tax relief and favorable emission norms for flex-fuel vehicles. He emphasized that such support is crucial to encourage manufacturers to popularize this technology.
Gulati's core argument hinges on a full lifecycle analysis of emissions, rather than just tailpipe output. He stated that ethanol-powered hybrid flex-fuel vehicles emerge as the cleanest among all technologies when emissions from raw material extraction to end-of-life disposal are considered. This perspective challenges the prevailing narrative that EVs are the ultimate zero-emission solution.
"We are globally the most competitive in internal combustion engines. This helps to sustain that technology. It's not a bad technology," Gulati noted. He added that an internal combustion engine running on clean fuel like pure ethanol or hydrogen can be as clean as any alternative.
The Economic and Geopolitical Rationale
Beyond environmental claims, Toyota presents a compelling economic argument. Gulati highlighted that the Indian automotive industry, with a turnover of ₹20 trillion, relies overwhelmingly (98-99%) on internal combustion engine (ICE) technologies. The sector contributes significantly to government revenue, including ₹88,000 crore in state road taxes.
"Now, imagine a future if these things were to disappear. So that is a non-viable outcome," he explained, stressing the need to find sustainable pathways for existing ICE technology through biofuels like ethanol.
The push also comes with a geopolitical angle. Toyota suggests that ethanol, being an indigenous fuel, would insulate India from external supply chain uncertainties, a pointed reference to challenges in the EV sector linked to China.
Industry Backing and Regulatory Context
Toyota's stance is bolstered by India's powerful sugar lobby, which has a direct interest in boosting ethanol demand. Deepak Ballani, Director General of the Indian Sugar Mills Association (ISMA), endorsed flex-fuel vehicles as "perhaps the most important ecosystem" for carbon emission reduction.
ISMA data reveals a significant underutilization of ethanol production capacity. While India has an annual capacity of 19 billion litres, oil marketing companies have only procured 10.5 billion litres for blending with petrol. The current national blending level stands at 20%.
This renewed advocacy comes as the government finalizes the third iteration of Corporate Average Fuel Efficiency (CAFE-III) norms. A draft proposal from September 25th counts one EV as three cars in emission calculations, while a hybrid flex-fuel vehicle counts as 2.5 cars. However, automakers like Tata Motors and Mahindra are publicly advocating for greater policy focus on pure EVs.
Toyota's proposal involves combining flex-fuel engines—which can run on any blend of ethanol and gasoline up to 100% ethanol—with plug-in or strong hybrid systems. This, Gulati argues, would maximize vehicle range and efficiency, potentially exceeding the performance of some EVs. The debate sets the stage for a pivotal policy decision that will shape India's automotive and energy landscape for decades to come.
