India expands biofuel tax benefit for ethanol and vegoils

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NEW DELHI (Reuters) - India has expanded the excise duty exemption for biofuels to encourage the blending of higher proportions of ethanol and components of vegetable oil with gasoline and diesel, a government order said.

India, the world's third-biggest oil importer and consumer, has been particularly keen to rein in its oil import bill since the conflict in Ukraine spurred a surge in global crude prices.

The tax exemption will be applicable to an ethanol portion of 12%-15% blended with gasoline, up from 10% previously. For diesel, the exemption will apply to a 20% portion of alkyl esters of long chain fatty acids obtained from vegetable oils, the order said.

India plans to introduce 20% ethanol blending with gasoline in some parts of the country from April next year, followed by a nationwide roll out from 2025/26.

(Reporting by Nidhi Verma and Aftab Ahmed; Editing by Edmund Klamann)